Could Millennial Snowflakes be the Catalyst to Keep the U.S. from Eliminating Cash?

by Kenneth Schortgen, The Daily Economist:

If there is one thing to be said about millennials it is that they are very emotional about their activism. And all one has to do is look over the past couple of years at their push for ‘safe spaces’ on campuses, rabid protests over a myriad of different topics, and the rejection of many status quo policies that have been at the core of America’s government over the past 20 years.

So with central banks, sovereign leaders, and elitist academics all pushing hard for the elimination of physical cash in the world’s monetary systems, an interesting irony is coming to the surface where today’s millennials could be the catalyst for protecting the economy from going 100% into a digital system.

If millennials are supposed to be the first generation going mostly cashless, they are making the move halfheartedly.
Millennials still rely on cash — 80 percent of millennials carry greenbacks. And 42 percent still write checks, according to the Accel + Qualtrics Millennial Study 2017.

And that could be a good thing, as some advisors say a cash diet is the best way to pare down debt.

The study corroborates other recent findings that technology is not overturning conventional ways to pay for things, even as millennials flock to mobile payment apps like Apple Pay and Venmo.

Sophia Bera, a millennial who founded Gen Y Planning and is a member of the CNBC Digital Financial Advisor Council, said most of her friends carry some cash, but she rarely sees them using it as the first option to pay for things. It’s mostly cash for emergency situations, or cash for tips.
“When I use Venmo it feels like magical money,” Bera said. “You forget that it is money, like any money, and that is bad.”

The financial advisor highly recommends cash to people trying to get out of credit card debt or for sticking to a budget. “A weekly cash amount is good,” Bera said. “Take out $200 every Friday and when it is gone it is gone. … It’s a lot harder to drop six twenties on a dress than swiping a card. People don’t buy flatscreen TVs with $20 bills.”

Bera said switching to cash, even for just a few months, can help people reign in spending, and is especially helpful for those trying to get out of debt. – CNBC

Psychology has always played a huge role in how people see and respect money. And all one has to do is look at a casino, which exchanges your currency for casino tokens (chips) because they know that gamblers are more than willing to spend these tokens in greater quantities than if they were playing a table game using real money.

Additionally, people became inured to accumulating high levels of debt when all they had to do is pay a paltry minimum amount which they could afford despite the fact they were actually increasing their debt levels through the interest compounding on that debt.

For a generation of Americans who suddenly had a wakeup call from the massive amounts of student loan debt they accumulated, recognizing the power of money by desiring to use cash instead of credit is a life-changing paradigm. And even with America’s youth being much more attuned towards using technology for nearly everything in today’s society, their lagging in the transition to a cashless digital society because they realize that spending cash over credit is extremely beneficial to keeping oneself out of debt, could be a serious factor in hindering the establishment’s agenda towards making all of finance one without physical money.

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