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
ADVANTAGES:
- 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.
DISADVANTAGES
- 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.
CASH PAYMENT
ADVANTAGES:
- 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.
DISADVANTAGES
- 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 donβt need it, donβt 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 DueΓ±as
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 perksπ, if any) – Ada Malayba-Mejia
read more feedbacks here:
MY THOUGHTS
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!
Maigi po na pag ipunan Yung mga “wants”. As much as possible iwasan gamitin ang cc sa mga bagay na dala ka Lang sa guyo. Be wise ika nga sa purchases.
Mas gusto nmin ni hubby Cash para wala nsng proproblemahin. π #spreadtheLEV
i prefer po to use CASH… para po wala na pong isipin sa pagbabayad ng utang …peaceful mind po π
#spreadtheLEV Lorna Reyes Macapagal : FB NAME
I’m actually a Credit Card person but I’m very organized when it comes to saving money. I like to take care of my savings.
I think both of them are good options as long as you spend carefully!
I prefer to pay cash if there is an additional discount given. If it is the same for cash and credit card payment, I choose to,pay with credit card because it is more convenient – no need to bring a large amount of money. #spreadtheLev
My heart is torn because it depends on a situation. If I have a savings and I can use a portion of it in buying a new laptop then I will do it because I really want to purchase stuff in cash basis. But, if I do not have a cash and I really need to buy stuff then I will use my credit card but will avail the buy now, pay later deal. And, I should be mindful to allot a portion of my salary to pay for it and not to overspend in using credit card.
#spreadtheLEV
I can relate Mommy Levy because the laptop that I am using for my work is now on the berg of dying. I am now conditioning myself that sooner or later I need to buy a new one and I really need to as I am using it for work. I am now saving more because I really preferred buying in CASH instead of using a credit card. With cash, I can get discounts and of course freebies and I do not need to think every month of its payment. So, I will go for CASH in buying a new laptop. π
#spreadtheLEV
I use debit card when I purchased my laptop and may points which I can use to buy sa Watsons. If wala akong card, I prefer cash especially pag may suki card para may points pa rin. hehehe! Thanks for this info! #spreadtheLEV
FB: Mariya Bektorya
Very helpful nito sa at in mga momshies.. Thanks for sharing this article..
#spreadtheLEV
Thanks for sharing this insightful article.. For me mas okay ang cash MA’s natututo ako mag budget
#spreadtheLEV
hi po mommy,di po ako macomment pero nagbabasa po ako ng mga blogs po ninyo kaya babalikan ko na lang po yun mga fave ko n blog hehe..
this got my interest, pero still CC is a no-no for me.. im a spender kasi but a wise spender.. i spend then ipon not ipon then spend hehe..
mas feel ko pa din if i can enjoy both worlds.. spending and nakakapag-ipon..
thank you po for always inspiring us.. π
#spreadtheLEV
Gerald Estrella
Depende nga sa need or want, wala kaming cc ni hubby ang natry namin ay yung hulugan na appliances tv ung kinuha namin sinunod ko lang talaga ung rules of payment para maavail ko yung rebates at naavail ko naman sa tamang pagbabudget. -Dangelyn Natividad-Taotao
#spreadtheLEV
Wala akong CC kaya no comment. Pero yung huling “big buy” ko was nun 2016, camera, kailangan ko naman kasi for my business to take pics of my items, as well as sa mga pang OOTD ng anak which is kinakarir ko din as kid blogger (me perks naman din kasi kami nakukuha) and also sa mga blogging needs ko. Nun super duper need ko na at kulang pa yung cash ko, I paid for 2/3 of it tapos naki ride sa CC lang ng tita ko for the remaining. At least, mas maliit lang need ko bayaran monthly for 6months and mapupush ako mag bayad kasi nakikiride nga lang haha!
#SpreadTheLEV
Wala naman pong masama if you want to use your credit card on your purchases as long as na kaya mo syang bayaran monthly at hindi ka maghahagilap ng pambayad on other credit cards, as well, or Pati na sa ibang tao kasi MAS mahihirapan ka lalo. Hindi naman kasi ginawa ang credit card para pahirapan ka. You just need to use it wisely and better spending. For me, mas prefer ko ang cash. Less-worries na, much enjoyment pa!
#spreadtheLEV
Fb Name: Abba Seyer
Cash for me.para ala na ko iniisip na binabayaran monthly
#spreadthelev
Thanks for elaborating this topic super helpful po nito. #spreadtheLEV
This is an insightful article π I personally use credit cards more since I can earn rebates, points or free items. I just make sure to pay the full amount every due date and make it a habit not to overspend.
#spreadtheLEV
Usually I used card for shopping and grocery. And cash on delivery when purchasing through online. I feel anxious and worried when I have big amount of money in my wallet.
#spreadtheLEV
FB Name: Jeanette Layar
Usually I used card for shopping and grocery. And cash on delivery when purchasing through online. I feel anxious and worried when I have big amount of money in my wallet.
#spreadtheLEV
FB Name: Jeanette Layar
Para sakin mas okay kung cash. Para matuto tayo ibudget kung ano lang ang meron. Kase kung may credit card, mapapabili ka ng hindi mo kailangan eh. Yung tipong wala sa plani. Pero sabi nga nung iba nasa pagkokontrol mo lang ng sarili yan. Kaso hindi talaga gumana sakin eh π
Ayan tuloy nabaon ako sa utang dahil sa credit card. #spreadtheLEV
I admit , I am very immature when I use my credit card kasi i cannot control nagiging impulsive buyer ako BUT that was before. I was able to stop that practice and nakasurvive naman for 2 years now na hindi gumagamit ng CC. umabot sa point na mas malaki ang expenses kaysa income ko kaya i stop. Now, every payday I learn how to budget na ang always make the needs as a priority. #spreadtheLEV
For me, I would say mas advantage ang gumamit ng cash, at least you do not need to worry ng mga additional fees and whatsoever kung nalimutan bayaran ang monthly. #spreadtheLEV
Para sa akin the best po talaga ang Cash kung meron ka namang available na Cash kasi pag bayad mo ng Cash yun na yun you’ve already paid the items…Sa Credit Card kasi may interest ka pang babayaran tapos may risks pa ma-clone yung card at may ibang taomg gumamit at mamili gamit ang card mo…Ok yung Credit Card kung mag-travel ka abroad for convenience pag nag-shopping at bumili ng mga imported items or international brands…Pero nasa tao pa rin kung ok lang yung pagbabayad ng Credit Card interests para sa kanya at maingat sya sa pag handle ng Credit card nya ay wala naman pong masama π
#spreadtheLEV
FB username: Imelda Jaylo Palad
Good read! Saw this post earlier on FB finally I get the chance to read the whole article, it gives me a lot of ideas about credit cards. Me and the father of my kids don’t have any,sabi niya sakit lang sa ulo daw yung credit card or hindi lang talaga namin kaya mag avail. Haha. π I always dreamt of having one someday,nakaka inggit kasi yung iba na meron but then I realize in order for us to live comfortably (especially when it comes to money), matuto makuntento sa kung anong meron tayo.But I totally agree with one of the people who comment na kung kailangan mo talaga ang isang bagay dapat pinaghahandaan mo, pinag iipunan mo, gaya lang sa pangangailangan natin sa pang araw araw kailangan naka budget para hindi magipit o magkautang. It’s already midnight and I love spending my time reading the articles. π#spreadtheLEV
I’ve learn a lot from using credit card especially pag newbie ka don or you hirap ka magmanage. nag splurge ako using them to the point the unmanageable na sila. pero good thing na natuto ako pero im still using a credit card .#spreadtheLEV
Straight purchase using my card to earn the reward points then pay for it in full via online banking. Para di ko din nakakalimutan. Tapos nag-earn na ng rewards points. Lalo ngayon na 4th quarter, andaming promo ng mga banks! Like for every 3k straight purchase, may pa-Krispy Kreme or Jollibee si BPI. #spreadtheLEV
Para sakin mommy, ok rin ang may credit card. Pero nasa tamang gamit dapat. If may bibilhin ka at may cash ka naman, why not using your cash lalo at may discounts. Pero kami madalas pag mag Credit card more on appliances. Nakapundar kaming magasawa ng gamit sa bahay using credit card. Hindi kasi keri ang isang bayaran. Syempre 0% interest dapat at yung need lang sa bahay. #spreadtheLEV
For me and my husband, cash na lang. We tried having credit cards before kaso mahitap din i-control ang usage eh. Kaya when we were able to finish paying up our cards. Di na kami kumuha pa hahaha!
#spreadtheLEV
For me if you know how to use credit card wisely i’ll go for credit card since madami din perks at rewards. #Spreadthelev
For me mas maganda i cash na for payment para wala ka na iisipin monthly..basta pinag ipunan mo yung item na yun na gusto mo mabili.
#spreadtheLEV
Para sakin mommy, ok rin ang may credit card. Pero nasa tamang gamit dapat. If may bibilhin ka at may cash ka naman, why not using your cash lalo at may discounts. Pero kami madalas pag mag Credit card more on appliances. Nakapundar kaming magasawa ng gamit sa bahay using credit card. Hindi kasi keri ang isang bayaran. Syempre 0% interest dapat at yung need lang sa bahay.
#spreadtheLEV
I prefer buying in cash. Feeling ko kc kaya naman pagipunan yung mga gamit na gusto natin bilhin. Tsaka feeling ko din mababaon lang sa utang kapag card ang ginamit. #spreadtheLEV
Mas prefer ko magdala ng cash kasi mas nacocontrol ko ung spendings ko lalo na kung mamimili ako kasi kapag kasi credit card hindi macontrol ang spendings mas lalong napapadami ang gastos
I prefer buying in cash than in card. Feeling ko kc mababaon ako sa utang if card ginamit ko. And kung kaya naman pagipunan na lang yung pambili better na cash na nga lang… -Anna marivien
I always use credit cards to earn points. Sayang din kasi yung mga rewards.. Kahit na meron akong budget for that item, i use credit card pa din pero straight payment nga lang. May mga ibang merchants kasi na nag allow na credit card pero makakaavail pa din ng discount. Tinatabi ko na lang yung pambayad sa savings account para hindi ko magastos.. Nagearn ako ng points nakaavail pa ko ng discount.. #spreadtheLEV
Para sakin mommy, ok rin ang may credit card. Pero nasa tamang gamit dapat. If may bibilhin ka at may cash ka naman, why not using your cash lalo at may discounts. Pero kami madalas pag mag Credit card more on appliances. Nakapundar kaming magasawa ng gamit sa bahay using credit card. Hindi kasi keri ang isang bayaran. Syempre 0% interest dapat at yung need lang sa bahay.
Insightful. I am planning to get a laptop myself soon and these tips are super helpful! #sharethelev
Mas better pa din if cash ang mode of payment para less worries. If walang cash on hand mas mabuti na pag ipunan mo na ang isang bagay bago bilhin.
#spreadtheLEV
For me nmn po credit card mas ok ksi like ako pag biglaan n bili tas wala ako cash or pera n hawak..swipe lang .hehe..un nga lang kaakibat nian s payment dapat bayaran agad ksi pag nag lmpas duedate..may penalty ..#spreadthelev
I usually opt for cash payments, I do not use the plastic money as much as possible. To avail some perks like rebates, I use the scan to pay (QR code) via GCash π
I bought my laptop mga 5mos ago, straight cash, and saved maybe 10k from it, so nakabili din ako ng speakers and headset. I also paid cash for renovations sa bahay and birthday ng anak.
I love it kasi wala na akong iisipin after. Especially since na lose ko yung isang major client ko – hindi naman kami sobrang naghihirap pero masisira definitely yung budget ko if naka monthly payments pa ako. We’ve been without credit cards for 2 years na…
Thinking before spending is so important. We use a cash envelope system for monthly budgeting, but still use our credit cards occasionally. For us, if we cannot pay the entire balance off on the credit card off at the end of the month, we do not make the purchase.
This is such a good breakdown of both payments, I do think that cash creates less problems but credit card sometimes is easier
Lately I’ve been using my credit card a lot but I agree, paying in cash is much more satisfying
Loved hearing about the different pros and cons. I’ll have to refer back to this, pinning for later π
What an interesting article! I love your thoughts on both cash and card options, and I 100% agree – I would also go for a credit card rather than paying in cash. I’d rather put cash in a bank and make money work for me through the interest while getting rewards from the credit card payment.