Think about how much stuff you have in your wallet at the moment: maybe a little cash, and probably a few debit cards or credit cards.
Now, are you satisfied with how much your wallet is earning for you?
It’s never a bad time to take a look inside that billfold to see if you can do better.
Cash
If you’ve got cash in your wallet, remember that it’s just sitting there, not earning you a dime of interest. Yes, I realize that’s easier said than done anyway these days, but it’s still the truth. (Well … unless you are investing in United States Series I savings bonds, which are paying almost 10% interest right now.) Regardless, it doesn’t change the fact that, when you pay for stuff with cash, you aren’t getting any rewards. Of course, it’s always important to keep at least a little bit of cash on hand for those smaller “emergencies” — whether it’s at the town fair to buy cotton candy, or at that annoying coffee shop that still doesn’t take plastic — but the truth is, those who are financially disciplined should maximize their purchasing power whenever possible by paying for goods and services with some sort of rewards-based credit card.
Debit Card
How is your debit card treating you these days? Are you using it for purchases – or mainly for withdrawing cash from the ATM? If it’s the latter, then you’re earning zero rewards. If it’s the former, I’ll caution you on two points: First, unlike a credit card, you typically get little or no liability coverage with a debit card, so there is a bit more risk. Second, most debit cards don’t offer rewards – although if you check the Internet you’ll find that there are a few exceptions out there.
Credit Card
Finally, about those credit cards … Are you getting awesome rewards, at no cost and a good interest rate? If you’re not, then you should do yourself a big favor and do a quick credit card comparison to see if you can get a better deal from a competing creditor. There are a lot of cards that offer great cash-back rewards, or even travel rewards, and have no annual fees. If your current card isn’t giving you anything more than points, or you’re paying an arm and a leg in fees each year, you should consider switching to a card that will work harder for you.
Your wallet will thank you for it.
Photo Credit: Casey Fleser
from the looks of that wallet i’d say that the owner of it should take that cash and invest in a new wallet. 😀
Dear Griper, My first thought was that the owner of the wallet was getting good use from the money with which he purchased it originally! My second thought was that the wallet still had miles of use left in it! My third thought was that years from now when the wallet stops functioning (no longer holds money and cards securely) he would do as I just did, go to a church thrift shop and buy a brand new wallet which was a gift to a person who did not like the color and donated it to the charity. I just bought a brand new, beautiful, all leather Fossil brand wallet in the original box with all documentation for $4. After 20 years my treasured, but increasingly shabby, yard sale purchased ostrich skin wallet had finally stopped doing its job. The longer a satisfactorily functioning item can be made to last, the lower the cost financially and environmentally. Cars, wallets, furniture, keep ’em longer and save money.
Given how low interest rates are these days, I’m not going to worry over the opportunity cost of keeping a bit of cash in the wallet, even if, as noted by Griper, it’s falling apart. 😀
I’ve got to agree with DC on this one. Even so-called High Interest Savings accounts are earning less than 1% these days, and while rewards are tempting, they can lead you to spend unnecessarily because of that carrot (rewards) dangling out in front of you. The act of physically spending cash instead of swiping a card really drives home the reality of what you are spending on, and when you are trying to stick to a budget, it makes you think if you really even want or need whatever it is you are buying.
I don’t love using credit cards, even the rewards one.
Instead, I have a credit union interest bearing checking account that current earns 4% up to $25000, but I have to use my debit as credit 10 times = $100 in total (and ebills and direct deposit). Even my best rewards card can’t beat that and I don’t have to worry about making a payment.
I’m trying to pad this account as much as possible these days. None of my other accounts come close.
I always credit card even buying a carton of milk at the corner store.
The Griper : from the looks of that wallet i’d say that the owner of it should take that cash and invest in a new wallet. 🤣
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haha, the Griper i agree with you LOL
That wallet still has some miles left in it. Start looking now for a bargain on one.
Well, Bill … that’s what I get for spending most of my discretionary money on fruitcake. 😉
If you gently heat a slice of fruit cake, you can make it into a new wallet.
Interesting. I’m going to have to try that.