Credit is Dead. Long Live Cash!

Newsweek ^ | Mar 24, 2010 | Daniel Gross

[2Jedismom]

"...The ability to adapt rapidly remains one of America's competitive advantages. And since the onset of the financial crisis, both consumers and businesses have embraced the new reality. After digging themselves out of $20,000 in debt in 2007, Susannah Fater, her husband, David—a district manager at Staples—and their four children did something radical: they became an all-cash household. "Bills like groceries, gas, and allowance are taken out every month and put into envelopes so that we know exactly where we are financially," says Susannah..."

[2Jedismom]

I can’t either! I make my kid do it!

LOL!!!

[Freedom4US]

I wouldn’t use a debit card as one would a credit card.

Way too much fraud going on right now. I use a credit card for a lot of purchases, but the charges get paid off right away, so I at least get some cashback at the end of the year, and no interest charges.

Next, I only use a debit card to get cash out from the ATM.
I have another checking account where I send my paycheck, it too has a debit card, but haven’t ever used it, so in theory that account number can’t get stolen. I don’t want to get cleaned out of my checking account.

[Mr. Lucky]

Well, it’s too late. My feelings are already hurt.

[bigbob]

Next, when people don’t have cash because Obama and the Dems have wrecked the economy, will be the barter system. Or the robbery system...

[Graybeard58]

I'm a little curious about what my "FICO" score is but not curious enough to find out.

[Graybeard58]

Well, it’s too late. My feelings are already hurt.

Man up!

Seriesly though, I sometimes post and regret after rereading.

[2Jedismom]

The last loan that I took out was a car loan back in 2007. My credit union loan officer said ours was excellent. We had a lot of credit all over the place.

Now we don’t, but I ‘spect my mortgage will keep it looking ok (not great) for a while.

[SueRae]

Back to basics.

[Graybeard58]

Next, I only use a debit card to get cash out from the ATM.

Here's a tip for you. I recently found out the hard way that at my C.U.'s ATMs, you have just 45 seconds to take your money out of the tray or the machine takes it back.

Ordinarily that's plenty of time but no one was behind me waiting and I was struggling to get my debit card back in it's holder in my wallet. Just as I reached for the cash, zip, it was gone.

[RockinRight]

Not always.

A credit card does offer a level of protection cash does not.

Lose your wallet with $1000 in it, you’re screwed. Lose a wallet-ful of credit cards, and in most cases, you’re OK.

Also, some things (air travel, car rental, hotels) must take a credit card. A debit card can be used but there are issues with that.

[posterchild]

:)
Do they ever come back with unrequested snacks?

[Graybeard58]

Odd thing, I keep losing the ammo I buy with cash every time I go on another boating trip.

Is there beer involved anywhere in this story?

[Freedom4US]

I wondered about that. But I never had the guts to see how long it would stay there! 45 seconds huh.

So... does the account get debited the cash, or does the ATM treat it as nothing happened?

[hoosierham]

If you pay cash and live responsibly there won't be a credit history so the banks will deny you credit when you really need it(or think you need it)!

The overwhelming majority of Americans ,like their government,are indebted for impulse and unwise purchases.I am as guilty as many.And once you find using the credit card for gas and groceries because you have no cash(having used the paycheck to pay off last month's gas and groceries) it can be really hard to get back ahead of the curve.When you can no longer pay off the total before adding next month's expenses you are losing ground and it will only worsen without real effort.

[Hoffer Rand]

I use a credit card for a lot of purchases, but the charges get paid off right away, so I at least get some cashback at the end of the year, and no interest charges.

Me too. Then I use my cashback to get gift cards for Bed, Bath, & Beyond and buy All Clad. $20 cashback gets a $25 gift card. Discover has bought me over $1500 of quality cook wear in the last few years. I just love gaming the system. :)

[Graybeard58]

In my case there was a bit of an uproar (created by me). I was at the drive up ATM at the C.U. office and when it happened, I left my car parked right where it was and went inside and told a teller what happened. She said my account would be debited the $300 amount until the machine was checked three days hence and I would not get the money in the mean time.

I asked to see the office manager and he gave me the same story. That's when I raised my voice to where others could hear. (Squeaky wheel gets greased) I told them that I had been doing business with the C.U. for more than 40 years and he was calling my integrity into question.

He agreed to give me the $300 and debit my account for it.

I realized later that he wasn't taking a risk doing that as he could have simply taken it from my account had he discovered I was trying to cheat.

[unkus]

Nope!

[library user]

I can’t imagine going back to walking into a station and waiting in line to talk to a human to pay for gas instead of just paying at the pump.

What if you have to buy cigarettes? (Disclaimer: I don't smoke). Why don't they install cigarette vending machines next to each pump? Then there's no reason to ever have to go inside the actual store.

[unkus]

I give up and will never buy ammo again for guns I don’t have.

[2Jedismom]

I wonder though, about the banks denying credit in the future because I live debt-free...

I think (I’m no expert, mind you)...but I wonder if maybe they’ll start asking for evidence of long-term bills you’ve paid, maybe from utilities or from cell-phone companies or something like that AND looking at collateral a bit more closely than they have recently.

But I seriously have no idea.