Cash Or Credit Card: Which Is the Best Way to Spend Your Money?
My laptop died last November 1 (yes gusto nya ipagtirik ko sya ng kandila din). Since my work needs it, I had no choice but to purchase one as soon as possible. The next day November 2, my husband and I went to SM Mall of Asia to find a new one ( I will tell you more about the brand and model on my next post).
We hopped from one computer shop to another to check which one gives a better offer. The ones we like ranged from P37,000 to P50,000. Some establishments offer 5% discount on cash while others can give a maximum of 10% discount. They also offer 0% interest for up to 24 months.
Here’s the thing, what will you do if you were given a choice between paying in cash or paying in installment. What are you going to choose?
Let’s look closer at these options
ON CREDIT CARD
- You don’t need to use your cash on your purchase. Just swipe your card and you are good to go.
- You can pay for your purchase on installment without additional interest (for 6, 12 or 24 months)
- Some cards offer a “Buy Now, Pay Later” promo
- You will earn reward points for using your credit card that you can use to claim freebies.
- You need to set aside the cash monthly for 6,12 or 24 months.
- If you forgot to settle the amount, you will have a penalty and at least 3% interest on your credit card.
- If your card is new, you have a 1-year FREE Annual Fee. But if you use it to purchase an item up to 12 or 24 months you need to pay for your credit card’s annual payment (unless the annual fee is waived).
- There’s a possibility that you will purchase more because you might not feel spending at all.
- You will get at least 10% discount on the item. Example, if you wanted an item worth P50,000, then P5,000 will be discounted on your purchase and you just need to pay P45,000.
- You can fully enjoy your item because it’s 100% yours already. No more monthly payment.
- Paying in cash will reduce your chances of having your identity stolen.
- You will avoid to buy more than what you need because the cash on your wallet is disappearing.
- It has this “Yes I did it!” feeling that you were able to pay in cash. And you avoided debt.
- I can’t think of any disadvantages of using cash. Do you?
I made a survey on my Facebook page what people usually do/use when purchasing something they need, is it cash or credit card? I read interesting feedbacks.
“Discount on cash for me mommy. Kasi kung NEED mo mo talaga at pinanghandaan mo naman talaga bilhin ang isang bagay so may nakalaan ka talaga. One time na bayad, one time na sakit sa bulsa pero wala ka namang iisipin na bayarin monthly. Kumbaga nakahinga ka na hindi yung isang taon mo pa (for 12mos installment) na ibabudget mo kada buwan. On the other hand, kung WANT mo lang at sa tingin mo kaya mo naman isingit sa budget mo per month yung bayad sa installment go na din sa deferred payments.” – Carleen Balanong Aguinaldo
Hinihintay ko yung may rebate. Last time naka 5k rebate ako. Minsan may store discount pa plus rebate. Plus buy now pay later pa. Buy ka now, tas 3 months after pa darating yung bill. – Samiel Latiza Garcia
Rule of thumb if you don’t need it, don’t buy it. If you need it, pay with cash. Hehe. Credit card good lang sya for good debt (e.g. purchases for business or anything with ROI) – Rica Dueñas
kung di kaya ng budget mo at need talaga mabili. dun sa 0 percent.. pero kung may pera ka naman dun na sa discount on cash payment – Princess Chet Villasin
Discount on cash payment pero gamitin cc straight (para makuha mo yung perks?, if any) – Ada Malayba-Mejia
read more feedbacks here:
I agree with one of my readers that if you need something right away and you don’t have a cash, it’s okay if you will pay using a credit card and take advantage of the 0% interest on installment. Just make sure to pay your monthly dues diligently to avoid charges and penalty.
On the other hand, if you need something and it’s not immediate, then it’s advisable to SAVE up for it until you completed the amount to purchase it on cash.
If you have a credit card and cash at the same time and you can’t decide which one to choose, my advise (based on the information I gathered) is to use the card and go for STRAIGHT charge transaction. This will give you at least 5-10% rebate (same as discount on cash), PLUS you will get reward points for using the card that you can use to avail freebies such as free meal, small appliances or travel.
I should have used this hack if I learned about it earlier. Recently my sister made me her supplementary from her credit card so I have one already (it’s been a decade since I cut all my cards). But because I was too afraid to use it, I paid for my laptop in cash. Sayang ang reward points, but still I’m happy with what I did which I think is more important.
SO THINK BEFORE YOU BUY AND SPEND WISELY MOMS!