Living In A Cashless World

Margaret Atkins MunroLet's Talk About MoneyLeave a Comment

Maybe it’s my age, but the correlation between cash and money has always been clear to me. My first allowances were paid in nickels and dimes, which I religiously deposited into my piggy bank. When piggy was full, I emptied him into my first savings account. Every time interest posted to that account, I had no difficulty picturing it as actual cash. And, on the rare occasion I took money out of the bank, the teller would hand me dollars and cents, not a check, or a credit memo on my debit card. In my wallet filled with plastic, I still always carry some cash with me, and that “mad money” has removed me from more than one unpleasant situation.

Lately, I’ve noticed a startling shift: people, especially young people, are becoming less interested in cash. At first, I thought this was limited to my own household, where my son, who has his first job, must be reminded, ad nauseum, to deposit his paycheck into his bank account. He is apparently unconcerned about the amount of his balance; the mound of unopened statements testifies that, so long as his debit card works, he doesn’t really care how much is in his account. My husband recently directed my attention to a column in Seven Days, written by a Burlington cab driver who remarked on UVM students’ indifference to cash as an acceptable means of exchange. The very attitude he described is the one I see in my own house, and I am very disturbed by this trend.

Cash has existed for thousands of years, not because we’re enamored of coins and bills, but because it provides a reliable measurement of exchange.

It would appear that our understanding of the relationship between cash in hand and amounts on deposit at the bank is largely vanishing from society. Money wired into an account is hard to visualize and therefore may not seem real or important; in the hands of our children, it disappears as magically as it appears, spent on video game subscriptions and in the I-Tunes store, without the purchaser of those items ever feeling as though he is spending money.

Cash may be disappearing from the economic landscape, but other traditional methods of exchange remain unaffected. The UVM cabbie points out that students appear to understand certain aspects of barter, although they perhaps haven’t quite cottoned onto the fact that, even in barter, the person with whom you’re bartering must agree to accept the goods you’re offering. They also know that you can pay for most things using your credit and/or debit card; if the rising levels of student credit card debt are any indication, they seemed to have missed the lesson that those credit card purchases must be paid for at a later date.

It is now possible to live an entirely cashless existence as money zips in and out of our accounts electronically. We pull from our accounts using our debit and credit cards and pay our bills with a password and a click of a button; our paychecks aren’t checks at all, but wire transfers going directly from our employer’s bank to our own. So long as we preserve the necessary connection between the amount we have in the bank, and the amounts we are spending, we maintain the equilibrium between what we have, and what we can afford.

What we’re seeing from this next generation is the danger inherent in a cashless society, the extinction of the correlation between money and value. When the means of exchange is cash in your pocket, you do without that cup of coffee, that postage stamp, or even that cab ride when your pocket is empty. But when that transaction is reduced to an automatic and meaningless swipe of a card, and you don’t even bother opening the statement at the end of the month, the association between price and affordability is lost.

Thus, the students who get into the back of a cab without the fare in their pocket assume that everyone takes plastic, and they don’t bother to ask what the terms of exchange are until they’ve literally taken the cabbie for a ride. And you need only look at the size of their student loans to recognize that their disdain for money extends far beyond daily expenses. Had they equated the amounts on the loan papers they so glibly signed to the cash they eventually must repay, they might have been less inclined to dig themselves into such a deep financial hole.

Even for those of us who remember a cash economy, the tendency is there to lose sight of the dollars as they are drawn from our accounts. Think, then, how much more profound the loss for our children, who have never relied on the spare $20 tucked into the back of their wallet for an emergency.

I still carry “mad money”, and it gives me a far greater sense of security than my ATM card ever will. My age may be showing, but I’ll never be caught shy of cab fare.