Earlier today, I was chatting with a friend about something we both found intriguing, and often frustrating; our millennial peers at Stanford just don’t carry much – if any – cash with them.
This isn’t a local issue, but rather a national one. A 2014 survey by the ICBA found that 1 in 4 millennials carry less than $5 with them every day, and a 2014 survey by Bankrate found that nearly 10% of Americans carry no cash with them on a daily basis, with 40% carrying less than $20.
While a few decades ago traveler’s checks were one of the only cashless options people could turn to, the plethora of technology nowadays allows for a variety of cashless mediums, including debit cards, credit cards, Paypal, Amazon Gift Cards, and, especially at Stanford, Venmo. Venmo is very well situated for the millennial market in that payments can be sent through a smartphone instantaneously, payments include an obligatory message to the receiver, and the app connects your bank and/or debit card in one place. It utilizes both the rise of ubiquitous social media and the desire for convenience (why get money from an ATM when you can send $20 with a couple taps on the screen?).
So why, then, did I title this article “Cash is (Still) King”?
One of the important lessons my father taught me was to always have cash on hand, because you never know what could happen. Although cashless payment systems offer convenience, protection from physical theft, and, ostensibly, a cap on overspending, there is a cost for that convenience. With the rise of cybertheft in an increasingly interconnected world, I find it hard to take people seriously who claim that their money is not safe in a wallet, but who connect their personal banking information to multiple devices and payment systems. Additionally, I would argue that use of cashless payments actually increases overspending, as it’s easier to limit yourself to cash on hand than to swipe a card or push a button without thinking of the ramifications of your actions. That’s why cash is still king; it’s something physical, something that’s accepted by all, something that’s easy to keep you in good fiscal health. You should definitely keep using Venmo or credit and debit cards or other cashless options – they are incredibly convenient options in our modern world. But if you only have two dollars and a shiny nickel on hand, I implore you to go to the ATM and retain on hand a stronger financial security blanket.