A close up of a newspaper

Shopping With Cash is Still the Best Way to Save Money

When did you last hold a $50 bill in your hand? The new ones look strange … faintly colored, graphically random.A close up of a newspaper

Cash in hand

You should pick one up sometime to reacquaint yourself with something called U.S. currency. Look closely. It still reads: This note is legal tender for all debts, public and private.

Here’s my question: Does purchasing gasoline at Costco constitute a public or private debt?

Between the moment my gas tank is full and the moment I actually pay for the gas, I owe Costco some money. I have incurred a momentary debt, and it seems to me that I should be able to pay it with my U.S. currency.

Just try. In fact, at Costco filling stations, my only choice is to pay with plastic—even though plenty of human attendants are readily available.

Now, before I get all cocky and make you think I am always careful to carry the amount of cash I need for the day, let me confess. I struggle with this kind of preparedness as much as anyone. So go easy on me.

Cash keeps us alert

While waiting in the gas line, I pondered what “legal tender for all debts” really means. Then it dawned on me that I needed a few things from the Costco store—items we purchase in larger sizes because it’s cheaper that way.

While sitting there waiting for my turn at the gas pump, I made my list. I also decided to pull out my checkbook to be prepared once I made it into the store. Rats! I left it at home.

There I was, having waded through a sea of fellow shoppers to get inside the door and not about to go all the way home to get it. A quick review revealed that I had $42.23 cash.

From that moment on I was a different kind of shopper.

Before assessing my cash situation, I only wanted to be sure that I wouldn’t forget anything on my list. But now I was thinking about how many items were unimportant so I could cross them off the list.

One after another, that’s precisely what I did. I pondered. Next, I calculated. Then, I compared.

Finally, I arrived at the checkout with only two items in my cart. I got what I needed and spent less than $23 by switching from name brands to the Kirkland store brand for both items.

As I stood in the last line to get out the door, I had to deal with my attitude.

Without realizing it, I was judgmental and critical of all these people with their carts loaded to the rafters and beyond. They don’t even think about how much they’re spending!

Plastic wake-up call

I worked on myself long enough to come to this reasonable conclusion: The credit-card industry has our number. They know that if they can get us to forego cash in favor of plastic, we’ll spend more—even when we habitually pay the entire balance when the credit card statement arrives OR keep plenty of money in the account to cover debit care purchases.

They know we’ll shop with abandon and care more about what we’re buying than how much we spend. Without a doubt, we all need that kind of wake-up call from time to time.

By the way, there is a way to pay cash for gasoline at Costco. It’s a two-step process that is neither quick nor convenient: Walk into the store and go to Customer Service. Purchase a Costco Cash Card with cash, which is one of the plastic options accepted at Costco gasoline pumps.

Updated republished 11-5-22

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13 replies
  1. Sue in MN says:

    Cash! I have a daughter who earns a very nice salary, but struggles to manage her money. Credit and debit cards are dangerous to her financial well-being. Back when she was a student, and had to budget every penny for the week, she would buy cash cards (actually gift cards back then) for her go-to grocery store and gas station each payday.She has continued that habit for years now. And she uses gift cards from holidays or birthdays for her favorite restaurants and shops, reloading them from her own budget when they are spent. Most important to her busy life, she figured out a cash option for PayPal – she uses a funded PayPal account, into which she places a specific amount for on-line purchases each month; they notify her when the balance is low. To keep herself from “Oh, well, it can always go onto my attached credit card” she has attached a credit card on my account (which she has to make purchases for me or in a financial emergency) instead of her much more convenient checking account. No way she wants me to see she has slid back into her old ways, so she never overspends.
    The gift card option would work perfectly for all Costco (or Target, grocery, etc..) purchases, and there is no charge to purchase them.
    News flash – I keep a $20 bill inside the back of my phone case because I tend to run out of the house with just my phone and
    the car key in my pocket to run errands – I could easily add a prepaid Visa so I never find myself unable to complete my errands. Hmm..

    • MEF says:

      I spend more when I carry cash…I also stopped using my debit card (no points/little return protection) I use my credit card I know just how much I can spend pay my balance in full each month…For me this is best way for me to budget…it all comes out of the same account…my rent and utilities are in a separate account. Yes I keep emergency money tucked away in my wallet…there are times when I leave my credit card at home so I will not be tempted…One note garage sales I do use cash.

      • tboofy says:

        Utah just passed a law that it’s legal to keep a digital copy of your driver’s license on your phone. Not sure exactly how it works–I think the Driver’s License Division is going to create a digital license or something–just thought it was interesting!

  2. nancy jacoby says:

    You can add banks to the list of business that don’t want cash!!! just this week received the letter from our bank where we have our retail business accounts telling us that beginning in May 2019 if a business deposits more than $10,000 in cash in a month’s time there will be a fee for every $100 over the $10,000…can you believe it?!!!

  3. sueherm says:

    2 years ago, after watching a Dave Ramsey video, I did an experiment using cash for my groceries, personal care, pet care and household items, in general the areas where I was inclined to blow my budget. I had been using a debit card, and frankly I expected to prove Dave’s premise that I would spend less using cash wrong. I’m sure you can guess where this is going; I was the one who was wrong. Overall, I spend about 20% less using cash. And as an added bonus it keeps me very deliberate about my Target shopping because I feel stupid shopping there and not using my Red card.

  4. Elle A Zajíčková says:

    Why not use a debit card? It makes no sense to contribute to the endless plastic waste by buying a Costco pre-paid card when a debit card is a reuseable cash-like option.

  5. Linda Pries says:

    I don’t use cash for gas because I get an extra .05 per gallon off when I use my gas buddies card which is linked to my bank debit card. I make a point of knowing how much I have available in my bank account and the only time I use a credit card is for necessities( think car repair, vet bills) and even then I use my care credit card if possible which gives me 6 months to a year before I have to pay interest.

    • Mary Hunt says:

      Do you really think that your bank/gas buddies or whatever are simply giving you .05 per gallon because they like you? You need to think more deeply about this situation. They KNOW through miles of data and tracking and calculating consumer behavior. The bottom line: You will spend more and by more I mean in excess of the $.05 they gamble on the frontend. They would not continue playing this game if you, their opponent, came out the winner 100% of the time, which you believe. Banks do not offer debit cards and buddy cards and you name it kind of plastic out of the goodness of their hearts and to reduce their profits.

  6. Jenni says:

    There were some restaurants in SF who tried the “no cash” rule. The city told them they MUST accept cash along with credit cards. A lot of people think it was to keep out people who tend to only deal in cash: the homeless, and people who at the end of the week don’t have enough to even open a bank account, etc. I think it’s bad business to deny cash!

  7. Linda says:

    We now live in TN after moving from the Chicago area. We were happy to see that there was a Speedway gas station here. We have a Speedway charge card. We use it to charge our gas. They award you points for buying gas, and also there are various ways to earn points. Sometimes it is as easy as purchasing anything from the interior of the store area, for 10 days during maybe a 20 day time frame to earn 2,000 bonus points. When you accumulate a certain number of points, you can redeem them for a Speedway gas card that costs you ZERO $$. When we lived in Illinois and were working and driving more, we got $200 or $300 worth of free gas just because we bought our gas at Speedway. They were usually lower than the surrounding stations, too.

    Now that we are in TN, we shop at Kroger, where they give fuel points for shopping there. You can also earn an extra 50 points just for filling out their on-line survey using the number on your receipt. Every 100 points gives you 10 cents off per gallon, and this benefit is good until the end of the next month. One month, we had earned $1 off! You can have up to 35 gallons of gas, so each month, we take both cars, park next to each other at one pump (opposite sides) and fill both cars up at the end of the month before the points expire. Then, we use our Speedway credit card to earn points at Speedway towards our free gas card there.

    We don’t think you can do much better than that!!

    • peatwee says:

      You can earn even more points at Kroger when you use their debit card: https://www.kroger.com/d/kroger-rewards-debit-card

      It debits your purchase from your existing bank account and you get 1.5 points for every dollar you spend instead of 1. If you link this to your Kroger Pay on the app, and use the QR code to pay, you earn double points.


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