Jun 14, 2012

Living in a Cash Society

I'm on my way home today (yay!), and looking forward to sleeping in my own bed, and hugging my husband and children. But I enjoyed my time in Japan, and on a personal finance front, I couldn't help thinking about the cash society that Japan still is (my last trip here was nearly 10 years ago). At a time when I rarely use any cash and completely failed at an all-cash experiment a few years ago, I was fascinated that cash is still the most common method of payment.

Japan is known for having one of the highest personal savings rates, and given the prominence of the use of cash, I can't help but think that the two go hand in hand. After all, personal finance bloggers and experts emphasize how switching to cash from credit cards decreases spending by forcing you to be aware of exactly how much you're spending. Money Saving Mom is my favorite example, since she is not only a shining example of cash-only success, but also regularly publishes success stories from others.

However, I also can't help noticing that personal safety is still less of an issue in Japan than it is in the U.S. Many women carry bags without zippers, because they don't have to worry about someone reaching in to take the contents. I'd guess that most people carry a fair amount of cash with them, without worrying about being mugged. (Although, I have noticed that some areas are a bit more sketchy than they used to be - maybe a side effect of the recession?)

Paying with cash in Japan has brought back reminders of what I dislike about using cash - the accumulation of loose change, how much longer it takes to pay because you're hunting for bills and the correct change, and the time it takes to put away any change while the store clerk politely holds the bag out. (And that's one thing that hasn't changed since the last time I was here - the unfailing politeness of store clerks especially always stands out to me as there's such an extreme contrast to the U.S.)

All in all, I will be very happy to be home and to go back to using my credit card to pay for purchases. However, I'll continue to try to be as aware of my spending as I would be if I were paying with cash.

Where do you stand on the all-cash system of personal spending?


Gina said...

I'm just like you--I've tried doing all-cash, and it just doesn't work for me. I'm of the mindset that it's worth using my AmEx because I earn cash back on it, pay my bill every month, and stay tight to my budget so that I'm NOT one of those people who spends more because I'm charging instead of cash-spending. Hopefully I'm right.

Chief Family Officer said...

Ah, so glad to know I'm not the only one!