How Much Cash to Carry in Your Wallet

Money Girl reviews 5 situations when you should have cash in your wallet, and how much is a good idea.

Laura Adams, MBA
3-minute read

How Much Cash to Carry in Your WalletSince debit and credit cards are accepted at just about every store, restaurant, and venue these days, I don’t carry much cash. Sometimes I might only have coins in my wallet and no paper bills. But I have to admit that this practice has left me in a pickle a few times!

Here are 5 situations when you really need to have cash in your wallet:

Situation #1: When you go to a new place

Once I was vacationing in Vero Beach, a small town in Florida, where the only drug store didn’t take debit or credit cards. Another time I went through a toll booth and had to pay the entire toll in pennies. Not only was this embarrassing and inconvenient, but it was also very irritating to drivers in line behind me!

Many parks, museums, and parking attendants only take cash. Additionally, if you stay in a nice hotel, you’ll need cash to tip car valets and bell hops. And I still run into cab drivers who pretend that their credit card terminals are broken. By the way, that’s one of the many reasons I’m a huge fan of Uber!

So always have at least $50 on hand when traveling to a new place.

Situation #2: When you shop at the farmer’s market

Recently, I wrote about how to save money at farmers’ markets. I mentioned that most don’t take credit, so be sure to take enough to get what you need—but not so much that you might overspend.

Better yet, carry plenty of small bills to help vendors make change easily. Those at my favorite farmers' market in San Mateo, CA often round down to the nearest dollar, especially if they don’t have to break a big bill. This saves time because they only have a few hours to make as many sales as possible. Cash may be old school, but it’s still fast.

Situation #3: When you’re budgeting

Studies show that when you use cash, instead of a debit or credit card, you're likely to spend less. Why? Currency is harder to part with than swiping a card that goes back into your wallet.

You don't have to convert to an all-cash system to stick to a spending plan—but it's a good option if you tend to overspend with plastic.

Situation #4: When giving   

How Much Cash to Carry in Your Wallet

If you’re like my husband and always want to support street musicians, artists, lemonade stands, bake sales, or car washes, you’ll need a few bucks in your wallet. The guy playing the banjo with his feet can’t stop mid-song to run your credit card for a tip.  


Situation #5: When you’re facing a natural disaster

Since I’ve lived in hurricane-prone areas most of my life, I know that having cash is critical when disaster strikes.

Card terminals and ATMs need power to work. Devastating storms, earthquakes, and floods can cause power outages for days or weeks.

If you live in an area prone to natural disasters, keep several hundred dollars in an emergency disaster kit in a safe place at home. That cash can buy food, water, and fuel when credit cards can’t. 

Just remember to grab your disaster kit if you need to evacuate.

Other Links You Might Like:

A Checklist to Measure Your Personal Finance Success

How to Grow Rich on a Budget

Financial Advice That Will Make You Rich

How to Make Decisions About Personal Finances

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Woman Holding a Purse and Cash in the Wallet images courtesy of Shutterstock

About the Author

Laura Adams, MBA

Laura Adams received an MBA from the University of Florida. She's an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura's previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.