Blog Layout

Is Cash Really Still the King

talessi@ariesfoundation.org

Cash vs. Credit - Who Wins This Battle?

This is to be a 5 Round Challenge   

In this corner we have the reigning long-time king of the ring - CASH, In the other corner we have the new up-and-comer CREDIT. We will be judging each round and then announcing the overall winner based on 5 criteria; Acceptability, Safety, Anonynmity, Rewards, and Credit Score
 
ROUND 1 - Acceptability                                                                                                                                       OK, so it is universally understood that most places will take cash; Franklin, Grant, and Jackson, just about everyone accepts cold-hard cash as a form of payment for all debts, whether they be public or private, no matter where your journey leads you one thing you can count on in life is that everyone wants money. But what if we are away someplace the dollar isn't accepted? Sure it's easier to pay with credit, but those transaction fees add up, plus remember you had better not forget to call your credit card company before your trip as they could flag your overseas spending as fraudulent and lock your account. Of course, there are those mom-and-pop restaurants or local tour guides that may not even accept cards, so it's always prudent to keep cash on hand.
That bring us to portability & convenience. A credit card takes up very little of your wallets real estate as compared to all those coins and bills, and swiping is super convenient, but depending on the size of the purchase it can slow down the transaction which isn't so pleasant for customers behind you in line. Also, there is the fact that some merchants are particular about which cards they accept and which ones they won’t. This creates a potential dilemma that now I need to have a variety of different cards on hand. To make matters worse some merchants go the cash-only route to avoid paying fees to the card companies at all well that seals it the fact that you can pay for pretty much anything with physical currency.                                                                                                                                            Round 1 goes to Cash in terms of acceptability 

ROUND 2 – Safety                                                                                                                                                  No matter who you are or where you are going, having large amounts of cash on you at all times isn't exactly the wisest behavior. Flashy shows of wealth can attract the wrong attention and if that money is stolen or lost, then it is probably gone for good. Credit cards arrive armed with various forms of purchase protection written into their policies, or at the very least, they have such programs available to their customers that way the victim is not on the hook for unauthorized purchases. However, stolen credit cards and identity theft can create chaos in our lives, even with the credit card company protocols in place, it can take a while to recover from all the damages you may suffer from identity theft. Even with all of that the use of plastic has become too prevalent and persuasive in our society nowadays, especially with the availability of debit cards and ATMs to access your cash when you really need too. Round 2 goes to Credit by a narrow margin

ROUND 3 - Anonymity                                                                                                                                        Clearly for those who prefer to remain “off the radar” using cash is the only way to go. I won’t go further with the Safety threat as detailed in Round 2, but there is also the concept of not leaving a paper trail behind. And we’re not talking just talking about from a safety point of view, we’re talking about Big Brother, or more accurately, Big Corporation, watching over all of your purchases. Ever been online and looked at an item to then only have ads for that item start popping up online all around you? Kind of a creepy feeling. And yes, you are being watched every time you make a purchase online.                                                                                                                                    Round 3 winner is Cash by a wide margin

ROUND 4 - Rewards                                                                                                                                              There are benefits to using cash, sure, but let's discuss the potential rewards; Paying for something immediately, for example an expensive dinner, or a pair of concert tickets, prevents you from potentially having to pay interest down the road, but only if you are not paying the debt off at the next billing date. You may get a discount if you're paying for a large purchase in cash, but that's about it. Credit cards offer many incentives including reward points or even cash back. The downside to this, of course, is the interest that you have to pay over time for the purchases. But if you're able to keep track of your spending, have savings available, and always pay on time, then using a credit card to gain those additional rewards may be the way to go.                                                                                          Round 4 goes to Credit but with a warning for the judges

ROUND 5 – Credit Score                                                                                                                                        In case you were not aware you might be surprised at just how many aspects of your life your credit report can affect, because it's not just about whether a bank will lend you money. So before we start judging this round let’s look at just what a credit score is anyway? It is a number that represents how trustworthy you are in terms of paying off your debt. There are many factors that determine the score; like how many credit cards are in your name, if you carry a balance on those cards, and by how much you pay down your debt every month. Your score partly depends on your account balances versus your credit limits, if you never charge anything then you aren't showing lenders whether you're trustworthy or not. In that case your credit score could go down, or simply disappear altogether. Banks may even close your credit cards, if you have zero balance and never charge anything, and that would make things difficult for you. Because down the road you are probably going to want to make some large purchases; A Car, Home, etc…and trying to do that with no, or very low credit can be problematic and more expensive                                                Round 5 goes to Credit as well, but only from the long view standpoint

Our Winner: Credit Cards                                                                                                                                    Ultimately credit cards are a necessary evil. They're an important building block to help you establish credit, meaning that in the future you'll be able to secure a mortgage to buy a house, or get a car loan to buy a new ride. Cash may be king, but by a score of 3 to 2 our judges give this battle to Credit

GOT QUESTIONS? ASK US. WE CAN HELP THAT!
On Thursday, February 25th at 6:30 PM we will be going over this, but also how buying versus renting affects alot of the decisions we ar emaking on a daily basis. Visit our website:
www.ariesfoundation.org/events to REGISTER and learn more

By Thomas Alessi January 5, 2025
Have you ever noticed how New Year's resolutions seem to lose their sparkle by the second or third week of January? If so, you’re not alone. Statistics show that most people abandon their resolutions within a few weeks of setting them. But why does this happen? The reasons often lie in how we approach our goals and the mindset we carry into the new year. One of the biggest culprits is setting unrealistic goals. Many of us feel a surge of motivation on January 1st and decide to aim for major life changes all at once—like losing 30 pounds in a month or working out every single day without fail. While ambition is admirable, these types of goals are often unattainable in such a short period, leading to frustration and eventual burnout. Another common issue is the lack of a clear plan. Resolutions often start as vague statements like “I want to get fit” or “I’ll save money this year.” Without actionable steps or measurable milestones, it’s easy to lose track of progress or get overwhelmed by the enormity of the goal. Without structure, even the best intentions can falter. Motivation fades quickly after the excitement of the new year dies down. Motivation is often fueled by novelty, but real change requires discipline and consistency—two traits that are harder to maintain over time. By mid-January, the initial enthusiasm often gives way to old habits, especially if we don’t have systems in place to reinforce new ones. Social and environmental pressures also play a role. Life gets busy, and as the demands of work, school, or family creep back in after the holiday lull, resolutions take a backseat. Pair this with temptations like junk food or the comfort of skipping the gym, and it’s no surprise that many people give up. Finally, many people don’t account for setbacks. Whether it’s missing a workout, overspending on a shopping trip, or indulging in an unhealthy meal, one slip-up can feel like a failure. This "all-or-nothing" mindset often leads to abandoning the resolution entirely instead of adjusting the plan. ________________________________________ Strategies to Overcome Quitters Day Breaking the cycle of quitting isn’t just possible—it’s entirely within your reach with the right mindset and strategies. Let’s dive into how you can overcome the challenges of Quitters Day and stick to your resolutions long-term. 1. Set Realistic and Measurable Goals The key to success lies in creating goals that are specific, measurable, achievable, relevant, and time-bound (SMART). For example, instead of saying, “I’ll get fit this year,” try “I’ll exercise for 30 minutes three times a week.” By breaking big aspirations into smaller, manageable steps, you’re less likely to feel overwhelmed and more likely to stay on track. 2. Build Consistent Habits, Not Just Motivation Motivation is fleeting, but habits are sustainable. Focus on creating daily or weekly routines that make progress automatic. For instance, if you want to eat healthier, prep your meals in advance or stock your kitchen with nutritious options. Building habits takes time, but once established, they become second nature. 3. Accountability and Support Systems Having someone to hold you accountable can make all the difference. Share your goals with a trusted friend, family member, or even a coach. Better yet, join a community or group with similar objectives. Knowing that someone is rooting for you—or counting on you—can keep you motivated during tough moments. 4. Reframe Setbacks as Learning Opportunities Setbacks are inevitable, but they don’t have to derail your progress. Instead of viewing a missed workout or a bad day as failure, see it as a chance to learn. What triggered the setback? How can you adjust your approach to prevent it in the future? Remember, growth isn’t linear—it’s a journey filled with ups and downs. 5. Celebrate Small Wins Big goals take time, so it’s important to recognize and celebrate progress along the way. Did you stick to your exercise routine for two weeks? Treat yourself to something meaningful, like new workout gear. Celebrating small milestones helps reinforce positive behavior and keeps you motivated for the long haul. 6. Focus on the Process, Not Just the Outcome Instead of fixating on the end goal, shift your mindset to enjoy the journey. For example, if your goal is to write a book, celebrate the act of writing every day rather than stressing about completing the manuscript. When you focus on the process, progress feels more achievable, and the outcome will naturally follow. 7. Leverage Technology and Tools Apps and tools can help you stay organized and motivated. Habit trackers, fitness apps, and budgeting tools make it easier to monitor progress and stay accountable. Life happens, and sometimes your resolutions need to evolve. Check in with yourself weekly or monthly to assess progress. Are your goals still realistic? Do you need to adjust your timeline or strategy? Being flexible ensures that your resolutions remain relevant and achievable. ________________________________________ With these strategies, you can break free from the Quitters Day trap and turn your resolutions into lasting change. The key is to approach your goals with patience, self-compassion, and a focus on progress rather than perfection. Change doesn’t happen overnight, but with consistent effort, you’ll be surprised at what you can accomplish.
By Thomas Alessi December 9, 2024
Budgeting and dieting are two of the most common self-improvement goals people set for themselves. Both aim to bring about positive changes—whether it's financial stability or better health. However, many find that sticking to a budget is just as challenging as sticking to a diet. Here’s why: 1. Restrictive Nature Both budgeting and dieting often start with a restrictive mindset. Just as a diet might cut out all your favorite foods, a budget might eliminate all your discretionary spending. This restriction can lead to feelings of deprivation, making it harder to stick to the plan. Over time, the temptation to "cheat" becomes stronger, whether it's indulging in a dessert or splurging on an unplanned purchase. 2. Unrealistic Expectations Many people set themselves up for failure by setting unrealistic goals. In dieting, this might mean expecting to lose a significant amount of weight in a short period. In budgeting, it could mean expecting to save a large portion of income without considering necessary expenses. When these high expectations aren't met, it can lead to discouragement and abandonment of the plan altogether. 3. Lack of Flexibility Life is unpredictable, and both diets and budgets need to be flexible to accommodate unexpected changes. A rigid diet plan doesn't account for social events or cravings, just as a strict budget doesn't account for emergencies or spontaneous opportunities. Flexibility is key to maintaining long-term success in both areas. 4. Emotional Factors Emotions play a significant role in both eating and spending habits. Stress, boredom, and happiness can all trigger overeating or overspending. Without addressing the underlying emotional triggers, it's challenging to maintain a diet or budget. Emotional awareness and coping strategies are essential for long-term success. 5. Short-Term vs. Long-Term Mindset Both dieting and budgeting often focus on short-term results rather than long-term sustainability. Crash diets and extreme budgeting can lead to quick results, but they are rarely sustainable. A more balanced approach that focuses on gradual, consistent changes is more likely to lead to lasting success. 6. Lack of Support Having a support system can make a significant difference in achieving goals. Just as people might join a weight loss group or hire a personal trainer, having a financial advisor or joining a budgeting community can provide the encouragement and accountability needed to stay on track. Making It Work To make both budgeting and dieting work, consider the following tips: • Set Realistic Goals: Aim for gradual progress rather than drastic changes. • Allow Flexibility: Build in some room for treats and unexpected expenses. • Address Emotional Triggers: Be mindful of how emotions affect your habits and develop healthy coping mechanisms. • Seek Support: Surround yourself with people who encourage and support your goals. • Focus on Long-Term Changes: Develop habits that you can maintain for life, rather than quick fixes. By understanding the similarities between budgeting and dieting, you can approach both with a more balanced and sustainable mindset. Remember, it's about progress, not perfection. Watch our Think With A Drink episode for ways to be better at handling your expenses: The Dreaded B Word
By Thomas Alessi November 22, 2024
7 Smart Shopping Tips for Black Friday
By Thomas Alessi November 11, 2024
Completing these financial tasks before year-end can help set you up for financial success in the New Year.
By Thomas Alessi August 19, 2024
This is a subtitle for your new post
By Thomas Alessi May 13, 2024
And You're Not Alone!
By Thomas Alessi May 1, 2024
The S&P 500 returned 26.34% last year
By Thomas Alessi April 18, 2024
Now It Looks Like No Landing At All...
By Thomas Alessi April 10, 2024
When a (jobs) report doesn't tell the whole story...
By Thomas Alessi March 26, 2024
The stock market is so bright that you're gonna need to wear shades...
More Posts
Share by: