These days, most of us walk around with a wallet or purse full of balance transfer credit cards, and don’t hesitate to pull out the plastic to pay for anything, regardless of how big or small. But, there are some instances in which it is better to dig down deep into the forgotten corners of your billfold and see if you can’t pull out some of the green stuff. Here are a few examples:
- Purchases under five dollars. Sure, it’s more convenient to use the credit card, but keep in mind that the merchant you are doing business with has to pay a nominal fee every time a customer swipes his card. While most merchants are more than happy to do so, the fee can make small transactions unprofitable for them.
- When leaving a tip. Most of us are aware of the fact that waitresses make most of their money in tips. A typical waitress is paid less than minimum wage by her employer, making up the difference in our tips. Most of us probably also realize that those tips are taxed, just like any other income. What you may not know, though, is that the government has a set percentage which they use to calculate waitresses’ taxes. If you leave a generous tip, doing so in cash allows the waitress to keep a bit more of it, making up for the other customer who skimped her (and for which she still has to pay taxes on the amount the government assumes she collected).
- When you don’t want the transaction traced back to you. Of course, this applies to paying off hit men and other nefarious associates. But, in all seriousness, there are times when you may have legitimate reasons to want to fly under the radar. And when you do, it’s a good idea to pay in cash because it can’t be traced back to you.
Most of the time, of course, it’s fine to use credit cards. And when you do, it’s better to go ahead and use balance transfer credit cards, especially while you still have the low introductory rate. But it’s always a good idea to carry around a little cash for small purchases and tips.
