Always Use Cash for These 5 Things

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There was a time when people only carried cash; anything else was just too unreliable. Retailers could reject checks, and those pesky credit cards sometimes wouldn't swipe. Cash was king. (See also: 5 Times You Should Never Use Your Company Credit Card)

Now, you can go for months without ever having to hand over a crisp $10 bill or handful of pocket change. However, there are still some instances when you should only use cash, either for convenience, or for safety. Here are the top five times you should always use cash.

1. Items at Farmer's Markets (or Flea Markets or Craft Shows)

If you want to come away from a farmer's market empty handed, go there with an empty wallet and a credit card. As much as they value your business, they won't take cards. At least 99% of them won't, anyway. These are people who don't have the inclination, or the ability, to have card readers and POS systems ready at their foldaway stalls. What's more, vendors pay fees to accept credit card transactions, which is another reason they don't want to work with them. Sure, you can swipe a card on a phone these days, but when it comes to dealing with farmers, artisans, and anyone else who does this for the pleasure of creating goods to sell locally, cash is always going to be your friend.

Many farmer's markets are held near businesses that have ATMs on the premises, so make that your first port of call. Just make sure not to trust a shabby ATM; there have been too many scams and cons involving bogus ATMs at places like this (having nothing to do with the vendors themselves).

2. Anything You May Have to Return

This is something many of my friends do. They will buy two or three different sizes of the same shirt or pair of jeans, try them on at home, and return the ones that don't fit. Personally, I use the changing room, but some people seem to be in an awful hurry these days. Anyway, when it comes time to do the dreaded return, the store will give you the money back in the same way that you paid. If you used a credit card, it will go back on that card. And that can take several days to return to your account. However, if your receipt shows that you paid in cash, the store will pay you back in that same, cold hard cash. Why have the inconvenience of waiting for the money to work its way through the system? Pay in cash, you'll get it back the second you return your items.

3. Craigslist Purchases

Craigslist is a great resource. You can find almost anything you want on there for a lot less than you can on eBay, and in retail stores. Of course, if you agree to buy a toaster, a chair, or a piece of furniture, and then show up with a credit card or a check, you are going to be laughed at. Craigslist sellers will only take cash; and when it comes to cash, small bills. Don't go to any Craigslist purchase with anything bigger than a $20 bill.

If a Craigslist seller tells you they will take cards, be extremely wary of them. It is now possible to replicate a card using a card reader you can plug into your phone or laptop. That simple transaction could wipe out your bank account. Yes, the fraud can be traced and you can get your money back, but it could be a while before you see the return of those funds. In the meantime, other standing bills could come out and leave you with overdraft fees, and it's also just an enormous hassle.

As always, be very careful when meeting anyone from Craigslist, especially if you have a large amount of cash on you. Take a friend or two, and notify people of where you're going and whom you're meeting. Insist on a public place, and follow these safety rules.

4. At Restaurants or Bars You Don't Trust

We all have our favorite watering holes and eateries. But when you're on vacation, or in a city or town you don't know well, you may visit an establishment you're unsure about. Yes, the food looks good, and the drinks are cheap, but do you really want your card to disappear for more than a few minutes? As the Real Hustle showed, that's all it takes to copy your card and get it back to you. It's called "card cloning." You've just paid for a lot more than the meal, and it will take a lot of work and time to get everything back that you're owed.

In these cases, always pay with cash. Whether it's a hole-in-the-wall café, a street vendor, a mom-n-pop bar, or anything else that gives you the "I'm really not too sure about this place" vibe, you should never hand over your credit or debit card.

5. When You Get Discounts for Cash

Some places don't like the hassle of dealing with cards and checks. In fact, you will notice more places than ever now refusing to take personal checks, and having minimums for card purchases. This is due to fees that they are charged for card transactions. So, if you see any kind of sign saying, "discount for cash," put the credit card back in the wallet and get out the bills. This can apply to small purchases, like gas stations, doctor co-pays, and restaurants, or big purchases like electronics and even cars. There are also times when you can negotiate a better price by paying for the item in cash, right there and then. Cash is instant, and anyone selling something loves instant money. So, if you know there will be any kind of haggling involved, bring the cash.

When do you insist on cash? Please share in comments!