A cashless society has some potential benefits, but experts also say we should proceed with caution. People who are unbanked, which means they’re more likely to be low-income, could potentially be left behind in a cashless society. And there are other potential problems with a world with no cash.
While some chains and specific stores are attempting to go cashless, cities like Philadelphia are banning this practice. Philly, at least, sees the potential problems with jumping into a cash-free society too quickly. And with its banning of cashless stores, other city, state, and national governments may also rethink going cashless too quickly.
But even with this slow change, the change is coming. It seems inevitable that our world will eventually be without cash. So it’s best to prepare for that potential reality now. Here are four ways you can begin to prepare for a cash-free life:
1. Keep Physical Records of Your Assets
One potentially big issue with a cashless society is that it depends so heavily on electronic records. And those records can be hacked. So it’s best practice to keep physical, printed copies of records about your assets. That may seem redundant, but it can help you in case of a hack or just a technology glitch.
Related Podcast: The Blue Binder – How to Create a Financial Binder
2. Open Bank Accounts
If you don’t already have bank accounts that you can access with a debit card and manage online, you’re missing out. Without access to a bank account, you could find yourself paying high fees to manage your money in cash. And you may find it increasingly difficult to pay for products and services with cash or even money orders. So if you don’t already have one, get a checking account.
Can’t get a checking account because of negative banking history? You can get a foot into this world with a prepaid credit card. It can come with some fees, but if you find the right card, these fees will likely be lower than the cost you pay to cash checks and otherwise manage cash. And you can use these cards to pay at places that don’t accept cash readily.
Related: Best Checking Account Alternative: Chime
3. Get On a Budget
There’s a reason Dave Ramsey and similar financial gurus recommend the cash-based envelope budgeting system. It tends to work. When you have to spend physical cash, you are more aware of what you’re spending. And when you have a set amount of cash to spend for a time period, you know exactly how much is left.
But that’s not to say you can’t successfully budget without using cash. You just need a system that works for you, and you need to use it regularly. So if you don’t already have an electronic or paper-and-pen budgeting system in place, now is the time to get one. Here’s a quick tutorial on how to start a very simple budget.
Resource: 10 Online Budget Tools
4. Prepare Your Business
If you’re a small business owner, entrepreneur, or freelancer, it’s even more important that you start preparing for a cashless society. If you can’t already take non-cash payments, now is the time to make it happen. And, really, taking credit and debit card payments has never been easier. Now you can take payments with a device you hook up to your ubiquitous smartphone, which is super simple.
Yes, taking plastic payments will come with some fees for your business. But it can also make budgeting and accounting simpler, since you can hook up your processing system to your accounting system. And taking non-cash payments may bring you new customers who would pass you by if you only accepted cash, which so many people just don’t carry anymore.
Overall, getting ready for a cashless society is simply about making smart moves with your money and money management skills. As long as you can document what’s yours, manage your money well through electronic means, and take payments without cash as a business owner, you should be good to go with the direction our society is moving.