Cash Vs Credit - Which Is Better?

Credit Cards or Cash, which one is better to use?
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What is better to use, credit cards or cash? It's a commonly asked question. In today's video I want to explain a little bit about what goes into making a credit score, and how which one is ultimately better to use, cash or credit cards?
My parents discovered credit cards. Imagine coming from a country where the concept of credit cards, didn’t exist, you could only buy, what you had in physical cash. If you didn’t have it, you couldn’t buy it. Then coming to the US and realizing, there’s these little plastic cards that make you be able to buy anything through financing.
So if you’re in credit card debt, student loan debt, or any other kind of debt, let’s get some stats out of the way because I don’t want you to feel bad.
The total consumer debt in the United States stands at nearly $14 trillion dollars. 1.5 trillion is coming from student loans, which is a household average of $46,822. Car loans, 1.3 trillion dollars or a household average of $27,804. Home loans….. 9.44 TRILLION dollars or $189,586.
And credit cards….according to Experian which is one of the credit bureaus that make up your credit score (whenever people ask how to increase your credit score) they are 1 of 3. The average credit card debt is at $6,194. That’s actually not bad, that’s manageable, but it continues to climb at a rate of 3% per year. The average FICO credit score is 703 which is pretty good, and the driving force behind the increase are millennials. So if you fall anywhere in that debt range, just remember to breathe, it’s going to be alright.
Before filming this video, I found an article by discover credit card, that said “Cash or Credit: Why Credit Cards win” which I thought was hilarious , a credit card company claiming that credit cards are better than cash.
Dave Ramsey, a big finance guy in this space says burn all credit cards and get rid of them. Graham Stephan, another respected finance KZbinr says, use them. So which is it? To understand the answer to this question, let’s cover some pros and cons that you may not have thought about before because they each have their strengths and weaknesses.
Pros of Credit Cards:
-Here is the uncomfortable truth, no matter how much you may hate credit cards: here in the United States, it's tough to live without a credit card. You literally NEED a credit card to pay for things like hotels, and rental cars. Credit cards can be accepted everywhere but cash is not.
- If your cash gets stolen, you’re completely out of luck, there’s no getting it back. With credit cards, if you lose it, all you have to do is call and cancel, some credit cards allow you to freeze the credit through the app directly without even needing to call.
- Credit cards help build your credit history. This is something only installment loans, and credit cards can do. Unfortunately utility and phone bills generally do not build your credit like a lot of people think they do, but they can hurt your credit if you don’t pay them on time.
- Credit cards can also pay off your loans by consolidating your credit card debt into one interest free credit card, so if you have a ton of credit card debt, consider transferring it to a lower interest rate card so that it can buy you some time - usually limited time and IF you have a good credit score.
- The BEST perk that credit cards provide over cash is the consumer protection and rewards like cash back.
-The downside to credit cards is pretty obvious. the annual percentage rates on these “unsecure loans”, or APR as they call it, is a HUGE 16.97%. The stock market ON AVERAGE, returns about 10%. So if you’re not paying your cards off every month, you’re giving those companies MORE money than you would make if you had money invested in the stock market.
Pro of Cash:
- Cash is a great tool for exercising self control, and budgeting in the most effective way possible.
*Links above include affiliate commission or referrals. I'm part of an affiliate network and I receive compensation from partnering websites. The video is accurate as of the posting date but may not be accurate in the future.

[@AndreiJikh]

Cash or credit, what's your preference? 🤔

[@Ed-yj1ep]

Debit, it's cash in the form of a card. No need to carry stacks of bills around.

[@InvestmentsforBeginners]

Credit, I'm very frugal person who like to have control of my spending, and using credit will not only help me build credit, but also I don't need to worry about getting cash all the time.

[@TLDWFinance]

I just did a livestream on this last night. From a Dave Ramsey perspective "cash is king" because it helps keep people out of debt. On the other hand, if you are disciplined and pay off the credit card every month, then by all means get a good rewards card and rack up those points. Just don't be like most doofuses... A huge number of people risk all this debt for a good points card, but then never actually utilize the points!

[@investingwithaaron9876]

Definately Credit Cards Loads of rewards and perks plus is a free money if you pay on time!

[@iovermaster]

Andrei Jikh I need help with the spread sheet from your Patreon page my stocks aren’t loading when I put them in and I put the new code from Jan 11 into the spreadsheet and still nothing

[@chrisglaze1410]

Maxing out your credit cards and missing every payment😏👌🏻

[@deleteduser8949]

And with that money start a company and sell it 5 years later for $50B.

[@CaseyBurnsInvesting]

AUDI RSQ8 My man

[@lorenzorivas61]

Just cancel your credit card it cancels the debt 🙄

[@loganlaj]

Investing With Chris 😂😂😂😂😂

[@Stephanie.0192]

Lorenzo Rivas that’s too funny

[@summertings3307]

AHAHA the ones to hundreds trick at the end, was the most important thing I learned in the whole video

[@Brilliantick99]

I've been waiting TTTOOOOO LONG FOR YOUR VIDEO. Another great video man

[@mindsinmotion2825]

That is awesome that you are going to assist your parents with getting out of debt. Good video!

[@FeralVyrux]

You should make a video about investing or paying off loans first and different situations that are involved!!

[@kaylinrodriguez8422]

I’ve been waiting so long for this video

[@Erika2]

As usual, such a fun and informative video! I would choose using credit cards over cash at any day! It's convenient and it has rewards, but of course pay the balance on time to really maximize the value of your credit card! 😃

[@morici0]

Erika Kullberg: Lawyer's Finance Tips The very few times I have used cash in the last few years was for those small merchants that charge an extra fee to the customer for paying with credit, and some gas stations that offer a cash discount. Thankfully most gas stations in my area charge the same price with cash or credit.

[@obi-wankenobi7902]

I've been through both experiences (paid everything cash OR credit), also read Dave's book and watched Graham's videos, my opinion is I prefer to pay things in cash because I spend way less. When I was using my CC for everything I would swipe swipe swipe and just worry about paying later. I never missed a payment however, nor payed a cent in credit card interest. But I realized that I could save/invest so much more money when I paid things in cash, as I was always checking my bank balances and could only spend what was left of my paycheck after I put money aside in my savings (paid myself). I still use my CC for small purchases or if I travel abroad because I feel it is safer to use CC than debit when traveling. I hope this info helped anyone who's thinking of changing their spending habits.

[@SwordsandBrushes]

"Breakfast or second breakfast" haha I love it!!

[@yuduGray]

Very similar life track! came here as an immigrant after escaping civil war in Liberia (West Africa) - Saw my parents lose everything and create horrible spending habits that were passed down to me and my siblings. In my late twenties and built-up a successful business and learned everything I could about credit, finances, saving, budgeting, and investing. I LOVE your channel as it resonates with me in every way! I would love to share some of my experiences and how I learned to budget and save with you and your audience one day!

[@guinevere6]

It is always interesting when you share about your family and Russia in your videos. I love Cirque du Soleil. It must have been very cool to have a dad that was a performer. It is great that you are helping them get out of debt as well.

[@dreamtv1981]

Andrei your videos have been helping me out so much! Keep up the great work man, I always look forward to Monday’s and Friday’s lol

[@OnlineEntrepreneur]

I was one of those who were using credit cards to spend money I didn't have to impress people I didn't know. Now thanks to people like you, my life has changed a lot and I see things in a very different way!! Keep creating amazing content!!

[@FinanceOptimum]

Excellent video, and great point about using debt as leverage during low interest rate environments to boost returns.

[@barrydavis7305]

the fed boost

[@CharleeWayne]

Reloadable prepaid visa & mastercards is a great alternative to credit cards

[@cuhhhrispy]

I already knew what you were going to say, thanks for recommending Graham. I came here to support my man! You just helped me make it all click in my head. Ive always wanted to invest my money but was so unsure. Im just a little upset I didnt invest sooner. Anyway thanks a lot and ill be looking forward to your next vid! ✌

[@jobhuntcafe]

before i watch this, Last video was really informative & good.

[@sashaleG1]

That was some really cool imagery of your parents, and you know what, you’re a different kind of performer! It definitely runs in the family!

[@bradmitchell7182]

You can tell a lot of effort went into this video!

[@AdamEspositoYT]

Whats up Andrei! I really enjoy your style of content for wealth building and overall life advice. its always entertaining. im pretty much implementing all of the money saving tips you give. im also just starting out on KZbin and hope to reach your level eventually! keep up the good work

[@Menimu]

OMG loved the LOTR quote, dear Pippin hahahahaa. great content !!!

[@GenExDividendInvestor]

Great video :) I think the answer of which is better depends on the person. If you are great at managing your money, then you will get benefits from using credit cards. If you are not great at managing your money, then its generally safer to just use cash.

[@BobCristofaro]

Your parents raised a very smart son!

[@AndreiJikh]

They tried...idk if they succeeded though haha

[@batkamarri13]

@@AndreiJikh they did amazing. Such great talents

[@DarioGalvans]

Thank you for being open about your family and their journey. You didn't have to show us photos of your parents, but in doing so, I feel like I know you better personally, and in that, more open to your advice, so thank you. Could you do a dividend portfolio update, seeing all your dividend income motivates me haha?

[@trevorhassel8296]

As long as you are responsible and pay it off everytime, I go credit! I do realize its not for everyone, but I think using credit is super beneficial when used correctly!

[@kingsleychiu8742]

I’ve never seen anyone do it better

[@AaronCrowder]

Cash, so the IRS can't tax me!! Jk jk, on another note, you inspired me to start my own KZbin channel. I was wondering if you could give any advice to a newbie like me on how to get myself out there?

[@MyTodin]

You are educational, entertaining, and genuine. Please keep doing you and producing great content.

[@AndreiJikh]

Thank you! I’ll keep trying my best

[@FinancialBeanstalk]

BRB, gonna go watch all the ads I can on your channel to help your parents out!

[@buffetsbrokersbroker]

What an engaging beginning. Just subbed. Loving your videos andrei!

[@jackofallvoices8404]

Please do a video explaining ETFs, the positives, negatives, what they are, who offers them etc. thanks in advance.

[@therocinante3443]

Advice and magic trick! Dude amazing channel.

[@jeffdorris5321]

I usually pay cash for everything. I see alot of people get into credit card debt and never get out of it.

[@LRC92]

The trick is to not use it for anything you couldn't pay for anyway, and if you always pay it back in full you get the benefits of a credit card without having to pay any interest or fees.

[@RandyLy]

I'm a big fan of Dave Ramsey and he was the one that literally smacked me in the face with personal finance. But times have changed and generations have shifted such that Dave Ramsey's advice isn't always applicable. I believe responsible credit card usage is better than cash. It makes sense mathematically. If you're going to buy what you already buy, you might as well get that cash back bonus.

[@bradmitchell7182]

I love you bro! You are awesome keep it up!

[@damiencharette3518]

Man I love your videos ! please keep posting them haha I'm addicted!

[@Arkine13]

I transferred one of my credit card balances to a margin loan, so some of my dividends are now paying my credit card off (the rest are re-investing) and I still have the card open in case of an emergency, plus the money that I'm now saving by not having that credit card payment anymore can go towards another debt (okay, I agree with Dave on ONE thing, the snowball method). I use the velocity banking method as well (with cash back rewards) so ALL of my monthly bills and expenses go on a card and then I pay a little extra to knock the card back to zero over time. Unfortunately, I think this new credit scoring system may hurt me because my card is yo-yoing so often, not sure if it's really taken effect yet, I haven't seen any major changes so far. In any case, I agree with you, credit cards are way better than cash. Oh, one other thing I should note, using the velocity banking, I actually pay very little in interest, and sometimes don't pay any interest...it's kind of weird. LOL

[@dorislowe1289]

If you are looking for an effective credit repair services you should reach out FicoPatchUp•Com as they help many clients get several item deleted off from credit report including medical items.

[@ginagomes5251]

@@dorislowe1289 I was in bad spot and needed a quick boost to my score. My score went up 170 points. More than what they said. I get to keep my home! I'd recommend FicoPatchUp•Com to anyone.

[@TheDreamGreenShow]

I have to ask! With so many videos back to back in the same week, above and beyond expectation with content and quality, do you have someone to help write your scripts and research? because im way in over my head on my channel trying to keep up with just 1 video a week lol.

[@YinHoweMagic]

Nice cups and balls 0:46, I think I started with the same set :)

[@mdinie13]

i enjoyed every single of your video

[@loganlaj]

I prefer credit cards!! I just love seeing my cash back rewards haha! Great video, Andrei!!

[@Diamond_Rob]

Ohhh mannnn I was wondering why you had a family look... Zedd 😅😅😅😅💥

[@MitchShoesmith]

Great video as always Andrei! I personally use credit cards for all of my purchases go get travel points and I just have a direct debit which pays it off automatically every single month. Just over 60,000 points now :D

[@GamersGrave]

You definitely Deserve More than what you have achieved Mr. Andrei.

[@bhusannepal7315]

Hey Andrei, could you make an video dedicated for trading options.

[@Roughrider347]

yes so stocked on a new video!

[@InvestmentsforBeginners]

You gotta be discipline about spending your money. If you have that discipline, and don't buy things in temptation or don't blow money away, credit card will help you build credit over and over. You'll also have better chance of not losing as much if someone were to rob you. If you have habit of spending left and right, having cash will allow you to control how much you need to spend. That's basically it. Cash will control how much you are allow to spend. You have to be careful with where your money is going with whatever amount of cash you have in your wallet because once those cash are gone, you're basically out of money until you get more cash. This doesn't mean you should always go to ATM or bank to pull money out all the time. You should take out X amount of cash per day to CONTROL your spending. I never carry cash around because I hardly spend anything that I don't find useful or need. I am very very frugal person like a famous KZbinr who always want you to smash his like button ;) So which is better? The way I see it, if you are discipline person with spending, credit card. If you have habit of spending money, then cash. Great topic discussion as always Andrei. Great way to start the weekend!

[@tiger-dq7kk]

Dislike, unsub. You suck! Lets drink some 20cent iced coffee ;)

[@hectorhidalgo2301]

I too am a Graham Stephan man

[@TotemoGaijin]

Crackin' some packs!

[@makaiokalahama]

Can you put together a video with current credit card recommendations? I'm looking to get another one with great travel/hotel benefits, but have no clue where to start.

[@desida50]

I prefer cash to save and invest. I invest in Vanguard, and today I made account with T212 and bought 2 stocks. 😊

[@jonathanaragon544]

I haven’t even watched the video yet and I’ve already liked and commented.

[@AndreiJikh]

haha thanks Jonathan, the algorithm and I appreciate it :)

[@mattsolomon71]

Andrei, thank you so much for making this video. If your ever in the Philly area I would love to meet up with you.

[@AndreiJikh]

Thanks Matt! Appreciate the suggestion :)

[@greekninja998]

Sometimes you have to cut a finger to save your hand. So many times between two items an expensive one and a cheap one , choosing the expensive one may save you tons of money in the future so it's better to have a credit card.

[@DividendGrowthInvesting]

I cant remember the last time I paid for anything with cash. I just got my annual statement from capital one on my rewards from 2019.... I paid 0% in interest but literally made $954 in rewards. I'm just a normal guy and can really say the credit card hack works!

[@AndreiJikh]

I wonder if ANYONE uses cash at all? It's such a rare breed these days

[@DividendGrowthInvesting]

​@@AndreiJikh I really liked the story of your dad! Lol the accent cracked me up! Cheers from Austin Texas!

[@Defy_Convention]

Literally?

[@DividendGrowthInvesting]

​@@Defy_Convention Yeah. My wife is also on the account so she has her own card. We use our card for everything and pay it off immediately.

[@DAVENATCHSTOCKS]

smart

[@LavidaSIMPLE]

Love your videos

[@darrylk808]

Hi Andrei, been watching your entertaining and informative vids for a while. Question: How do you throw cards in the air and catch them while not taking your eyes off the camera?? How many takes do you do to get it right? :) I send links to your vids to my younger friends and family...great advice!

[@jakebrugger8458]

Cant watch the video yet, but I just want to shoot an appreciation post to Andrei for putting such hard work in for our financial education entertainment!

[@DapaChrons]

Can we see more videos of you buying a dividend stock for Money Monday videos? great video btw, and showing us the story of your parents

[@mindsinmotion2825]

I said that a while back. Threat was on of the first videos I saw on this channel.

[@mr.schoko8032]

I love your magic tricks!

[@LennyRandom]

Opening pokemon packs during Christmas with your family? That is some family goals.

[@AndreiJikh]

😂 haha it’s the best

[@fifajjang77]

Hello Andrei I'm learning alot from your videos really appreciate it! I just have a question about the Robinhood, when I go to my account I see "Unsettled Funds" at some certain value. Could you briefly explain what this is? Does this value change in the next few days? Or will it be same? Thank you and I made sure to subscribe!

[@mcmiller1002]

hey anyway you can do another stock portfolio update please thanks love your channel.

[@cowboiturtle8865]

Hey Andrei, I'm 18 years old and I was wondering how can I increase my buying power or how much I borrow on my credit card? Also, I am thinking of buying a quadplex with a credit card and renting out all of the spaces for income. If I do that, should I pay the minimum in case I can't pay in full?

[@jaketalksfinance8034]

I think many you tubers not naming names have made many people misunderstand credit cards as long as you responsibly look after them you get great points and bonuses that make you a lot on your monthly payment

[@toongritty]

Great video!

[@delafe]

Andrei, as someone that used to finance telephone systems I can assure you, stores WANT you to finance with them. Every time you sign a car lease the dealership gets a percentage. A fairly large percentage. Plus, they can ADD points, up to 7% in most cases. So if they sell you a 20K car worst case the get an extra $200 up to $1,700.

[@alteredillusions100]

Good video

[@CaseyBurnsInvesting]

I need a few things from the grocery I do things alone now mostly. She turned to me that’s when she said it looked me dead in the face asked “Cash or credit?” and I....

[@jonathanleak7263]

Jizzed in my pants!

[@andrewhernandez7928]

Hey Andrei I really hope you answer this question! I’m thinking about taking out subsidized student loans and put the money into the stock market. I would be borrowing money for free assuming I pay it off upfront after I get out of college.

[@KenanGrace]

I just posted a finance Video on my channel! Love when you upload! It’s so inspirational! Keep up the great work!

[@carloslcervantes2658]

You should have a get together of your fans in Vegas

[@TheperfectfrenchwithDylane]

I use credit cards but very carefully. Especially for cash back or points. If someone has trouble managing his money that person shouldn’t have a credit card, unfortunately they are so easy to get and to accumulate!

[@RossCampoli]

Gotta maximize those rewards points!

[@AussieMoneyMan]

Yeap!

[@TerenceY]

I use my credit card all the time too. I have $1500 in reward points at the moment that I need to spend soon as they will expire. Cash only for emergencies.

[@VincentDesiano]

Love the AMEX Gold!

[@AndreiJikh]

I used to have that card! I booked a free flight after meeting their sign up bonus :)

[@VincentDesiano]

@@AndreiJikh Almost at 100k points so I may have to start scoping out a trip!

[@-_oOtianaOo_-]

I am so glad to have found your channel i have been binge watching .lol. I have tried to listen to other people but either they want u to buy something or i dont understand what they mean. Thank you for your honesty, transparency, your humor, and how you explain things . i have learned more from you than years of watching others videos. I want to invest but i get so frustrated listening to others explain because i dont know the verbage .. I appreciate you. I am a single mom and wanted to invest for my kids future but fear making the wrong decision because i know nothing about investing even researching still makes my head spin but watching your videos gave me an idea of what i could look into and i really do appreciate you for it.. You have alot of knowledge and i appreciate you sharing that with us.Thank u so much. ♥ sorry about long comment

[@AndreiJikh]

Thank you so much Tiana! That means a lot! I know it’s confusing but people try to make it more complicated than it actually is so they can sell you a solution to it. The truth is, no one knows what’s going to happen, the best thing to do is find a strategy that works best for you mentally speaking, and stick with it by being consistent

[@Krivaja22]

Personally use credit cards but make sure to pay off balance on time

[@AndreiJikh]

Definitely never carry a balance :)

[@puziol446]

Could you do a video explaining what you can do to reduce taxes? Every single year I claim few thousands in taxes 😑

[@ThaGamingLlama]

Great video! I personally use cash over credit cards.

[@AussieMoneyMan]

Credit cards are definitely misunderstood as a result of comments from people such as Dave Ramsey. I talk on this a lot on my channel such as how I make money from them.

[@homer_thompson5090]

Credit cards are the most heavily marketed product in history, spending billions of dollars annually on marketing to sucker people into using their product. Great for you if you're able to avoid getting "bitten by snakes" in the short term, as Dave Ramsey puts it. But advertising your "success" with them to others is downright misleading because whatever method you use wouldn't work as a whole, as the credit card companies would then be out of business.

[@AussieMoneyMan]

@@homer_thompson5090 Only if everyone did it.

[@AussieMoneyMan]

@@branpod Yes, that is fair!

[@scattysigue3604]

I’ve been using credit cards for two years, only use debit to withdraw cash when i needed to. Never pay interest and earn a lot of cashback and points

[@nathaniel3427]

If you have the discipline to always pay your card off monthly, or more frequently - credit is always the way to go. I pay mine off every 1-2 weeks, avoid interest charges while gaining benefits of using the card like cash back

[@j.e.torres7044]

As soon as you said you and your family open Pokemon cards together I subscribed 😁

[@astronautrocks]

Awww loooooooooooooveeeeee the parent's story

[@christopherjohn5575]

I really dig the Graham Stephan lamp 😂🤣😂

[@AndreiJikh]

Woah he made that lamp? I had no clue 😆

[@dustinkirby3478]

Very honorable for you to help your parents with the talents and gifts God has afforded you. Keep up the good work brother!

[@longstoryshortstory3192]

Thanks...

[@blackimpala1967]

I think the Russian accent makes me feel the need to listen and do as I'm told. Probably just me.

[@klevinallen6799]

I brought a cc from *Cardermanager2* on telegram best vendor I know and very trustworthy. He sell cc,fullz,Bank,Drops,and Dumps

[@edwardmedina6750]

Nice

[@zerohourtv256]

Profit? And I totally got your references!

[@FFEWAY]

What software do You use to edit The disappearing effect was magical.

[@dancer1]

your not a failure my man your more successful in your own way :)

[@alexaclark3792]

Aaron Crowder's channel has quality content similar to him!

[@clayhorning1241]

Wow, just about to make a video about why people need credit cards. People STILL fight me on this!

[@AndreiJikh]

Yea people are still terrified of credit cards 🙃

[@AussieMoneyMan]

Yeapp

[@marklandis5794]

Andrei Jikh yes, for cause.

[@mindfulinvestor]

Gotta rack up those points!!! + increasing credit is also great 👍

[@martinvasquez3251]

I use only credit cards. Use one every week (Chase, Capital One, Chase Rapid Rewards, Ame Exp.). I treat them like they're debit cards. I don't spend what I don't have, unless it's at 0% interest, then I'll utilize them for a big expense that is necessary. Plus, you get reward points and offers.

[@vik56in]

Andrei, your dad's background as an acrobat explains your initial forays into the showbiz industry and your talent for entertainment. Thanks for the video, I have liked it.

[@michaeltanner5058]

Funny u should mention him, i was just thinkiing about dave ramsey at the beginning of this.

[@scattysigue3604]

On asian restaurant they give discount when you pay physical cash because they can avoid paying tax if they dont report it and not record it 😂

[@MegaAndyblue]

Well explained andrei