Some stereotypes die hard. This is especially true about generations and money — in no small part because some of them hold the tiniest kernel of truth. Or, as Amy Poehler paraphrased on her podcast, “Boomers are all about money. Gen X is like, ‘Is it all about money?’ Millennials are like, ‘Where is the money,’ and Gen Z is like, ‘What is money?'”
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No, millennials didn’t bankrupt the world because they love lattes, but it does seem true that Gen Zers are excited about new trends blending technology and finance. There’s also evidence to suggest that one of the biggest stereotypes — that baby boomers are more likely to keep cash on hand — is the real deal.
Despite being slightly antiquated in the digital age, cash offers an alternative payment method in emergencies or at places that don’t take cards. It also provides a bit of old-fashioned privacy in a world where all of your transactions are being tracked (or even publicized on Venmo). So, maybe boomers are on to something by being all about cash, and here are three reasons their decision-making is spot on.
Cash Is a Powerful Budgeting Tool
Boomers have experienced a lot in their lifetimes, from major personal milestones to large-scale collective events. They’ve seen significant economic changes, which have compelled them to be more cautious about their saving and spending habits. By using cash, older Americans have a clear sense of what they’re spending.
The tangible, tactile experience of handling cash allows people to keep track of what’s coming in and what’s going out every time they hand a $20 bill to a cashier. That experience also makes the act of spending money more tangible in a way that using a credit card, or even a debit card, simply doesn’t.
You had $100 in your wallet, and now you have $80. So, you have to ask yourself: Is what you’re buying really worth watching your wallet get thinner?
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Cash Is Simply More Convenient
For many seniors, opening a wallet and grabbing a few bills is easier and more preferable to going online to transfer funds or check their balance. They also don’t want to worry about finding the right bank branch to withdraw cash without incurring extra fees.
It’s hard to fault their reasoning there — especially if you’ve ever had to fumble through a half-remembered password or search for the correct ATM. That said, there are times when it’s safer and less cumbersome to carry plastic instead of cash.
Boomers who value the convenience of cash might feel most comfortable banking with a larger institution with a vast network of branches and ATMs. For example, Capital One’s 360 Checking Account offers access to over 70,000 ATMs, upping the convenience factor considerably.
Whether you’re running errands or traveling, you’re likely to find a nearby ATM, making it easy to withdraw cash when you need it. For those who prefer digital banking, the Capital One mobile app adds even more flexibility — you can deposit checks remotely, track spending, and set up alerts to help manage your budget, all without setting foot in a bank branch.
Cash Can Feel More Stable
One of the biggest reasons people carry cash, according to an Empower survey, is to respond proactively to emergencies. About 69% of respondents said they carried cash to handle emergencies, while 42% said anxiety about the market pushed them to focus on cash rather than other investments.
Keeping cash on hand can help you respond quickly in a crisis, and unlike stocks, it isn’t as susceptible to market fluctuations. Unlike Gen Zers, who are more open to unique and relatively new investments like cryptocurrencies, baby boomers like to keep things solid and secure. And really, who can blame them?
That said, parking some of your emergency fund in a high-yield savings account, or HYSA, with an FDIC-insured institution, like Capital One, is a smart way to keep your money safe while earning interest. It allows you to grow your savings without taking on risk, offering a bit more stability than just cash alone.
The retirement generation is kickin’ it with cash these days, and for good reason. They appreciate its stability, convenience, and value as a budgeting tool. While cash offers many benefits, finding a balance between liquidity and long-term financial growth is key. By combining the immediacy of cash with smart savings strategies, you can create a financial plan that’s both flexible and secure.
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This article originally appeared on GOBankingRates.com: 3 Wise Reasons Boomers Carry More Cash Than Younger Generations
