Posts Tagged ‘Cash’

How Much Cash do Americans Keep on Hand?

Thursday, March 5th, 2009

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What’s in your pocket?


Americans are losing faith in banks, period. That goes without saying and no explanation is needed. We all know this. The stock market is falling; banks are going down and receiving money just to keep themselves afloat. What is the average American doing? They are stashing their cash or carrying it with them! In the past year, since gas prices started skyrocketing, Americans have started looking twice at their bank accounts and getting nervous. Even then there was talk of there being a recession. People started withdrawing their money in a frenzy and selling their stocks, starting to stash it at home and carrying large amounts in their wallets. So how much money do Americans carry in their wallets, and how much money is stashed in American homes?

The amount of cash Americans carry on their person is directly affected by the area of the country they live in. People in New York and Los Angeles are going to carry way more money than someone who lives in a smaller town like Lorain, Ohio or El Paso, Texas. Since the cost of living is so different, the cash one carries for basic necessities would be much higher in New York City and way lower in Lorain, Ohio. The demographics on carrying money look like this:
The average purse or wallet in the United States contains about $104.

13% of Americans use a piggy bank.

28% of Americans have a coin jar.

15% if people in the U.S. have a large amount of cash hidden in their houses. Out of these people, half of them have it hidden and the other half hide it in plain sight.

1/3 of Americans keep a small amount of cash on hand for emergencies.

Finally, more than 50% of American’s don’t keep any cash at all in the house.

American’s carry cash so they don’t have to use credit cards, foregoing the interest usually incurred in that way. People carry cash because they don’t trust the banks and they haven’t been able to trust banks for at least a year or more. Some carry cash because that’s what they’ve always done and that’s what they were taught to do. Sure a lot of people go into a bank or through the drive through to cash their paychecks, in return getting their cash for no extra fees. What about those who don’t go to the bank and whose checks are automatically deposited? These people will usually hit up the ATM. It’s difficult if possible at all to not incur a fee when using the ATM so this way of obtaining your cash is costing you money. Is the tradeoff worth it?

Some might argue that we’re becoming a no cash society; using less cash and more and more debit and credit cards. I wonder if these people have taken a look at the economy lately because I think we may be going back to using as little plastic as possible.

How and Why to Start a Savings Account

Tuesday, March 3rd, 2009

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Put your money where the bank is.


Get that cash out from under your mattress and your bra is not a good hiding spot. I’ve seen some funny and innovative places that people have hidden their cash but none of those places is safer than the bank. Does your mattress doesn’t pay you to put money under it? Well a bank does.

First things first, you want to find the bank that’s for you. If you’re a walk-in type of person, you’ll want a bank that has a branch in your area. If you’re internet savvy, you might want a bank where you can control everything online. Interest rate is also a big factor you should take into consideration when choosing a bank. The higher the interest rate, the more money you will make putting your money in that bank. Some banks require or “suggest” you start your account with a certain amount. This could be anywhere from $500 to $5000 to much more. Some suggest you keep a certain minimum balance your account. These are all things you want to know before you start putting your money anywhere and before you sign anything!

Next you should decide if you’re saving towards a purpose (like a home or car) or just to save for your future. Something like this can make a difference to the banker when you go to open your account. Decide on an amount from every paycheck that will go into your account automatically. Try not to deviate from this amount. A general rule is 10% of the money you bring in. You could also set up a change jar and save up extra change and dollars in between paychecks. You’ll be AMAZED how much change adds up. Once you’ve chosen your bank and you’re familiar with that bank’s practices, policies and interest rate go ahead and sign up. If you do this online you may have to send in a form with your signature or some official documents.

Why in the world would you want to start a savings account to begin with? Isn’t a checking account enough? Isn’t my pocket enough? Well, to tell the truth, the easier the access you have to your money, the more likely you are to spend it. That’s just a simple fact. You need to have some backup money that you have access to but that isn’t the easiest, first route you go through to pay for something. You need a savings account to save for an emergency. In case your car breaks down or you have something unexpected comes up from across the country. You don’t want to have to pull out a credit card if you don’t have to. Save for retirement, save for college, save up for a vacation. No matter what it’s for, even just a rainy day, even just a dollar here and there, SAVE your money. You’ll thank me later.

The History of the Paper Dollar

Saturday, February 28th, 2009

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The Massachusetts Bay Colony was the first of the thirteen colonies to issue permanently circulating banknotes in 1690. The reason behind this was because the paper could be more readily printed and circulated than gold coin. Many of these early bills were marked “Tis Death to Counterfeit.” In the early 1700s, each of the thirteen colonies had issued their own banknotes called “colonial script.” 1789 brought about the First Band of the United States which issued fixed denominations and printed banknotes until 1811 when it closed. From 1816 to 1841, the (you guessed it) Second Bank of the United States took on the responsibilities of printing banknotes.


The civil war, in 1861, needed to be funded with money that there just wasn’t enough of. In 1862, under Abraham Lincoln, the demand notes were issued, taking the place of interest bearing currency. Some necessities were added and changed in the next few years in order to stop counterfeiters. The new “Greenbacks” had an engraved Treasury seal and red and blue fibers in the paper which made them (at the time) very difficult to counterfeit which would cost the banks more money. Gold certificates were also issued against gold coin and bullion and were still in circulation until 1933 as well as silver certificates being issued for silver dollars until 1957. 1865 brought on the need for a Secret Service to police and control counterfeiters. How much was that really needed and how much of the US’s money was counterfeit? Oh only about one-third!


The one dollar United States Note was redesigned with a portrait of George Washington in the center and a vignette of Christopher Columbus. The back of the note also featured green and blue tinting. In 1880 the red floral design was added around the words “One Dollar” and “Washington D.C.” From 1890 to 1899 the gold and silver certificates were redesigned repeatedly in order to continue to make them harder and harder to be counterfeited. In 1910 the Department of the Treasury’s Bureau of Engraving and Printing took on all currency production functions including engraving, printing and processing. The Federal Reserve Act of 1913 created the Federal Reserve System. This means that the Federal Reserve became the central bank, regulating the flow of money. The Federal Reserve also became, to this day, the only authorized entity to issue Federal Reserve Notes (also known as, The Dollar(s)) which are the only U.S. currency produced and 99% of all currency in circulation!


“In God We Trust” No matter your religion, you know this phrase. This phrase was required by Congress in 1955 to be on every piece of currency and to this day, it still is. The last major change that was made was the microprinted security thread which was first introduced in 1990. It started with the $100 bills and the $50 bills, then eventually was introduced into the $20s, $10s, $5s, and $1s. Take a look at the money in your wallet. Now you know part of the long road traveled it took to get there.

A Backyard Full of CASH???

Sunday, December 14th, 2008

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dollar cash goldAs we enter into what is expected to be one of the largest recessions in our nation’s history, individuals throughout the United States are faced with the question: “what should I do with my money”? During the Great Depression, many individuals hid cans of coins in their backyards due to their mistrust of the banking institutions. More and more individuals have lost confidence in our current banking system and have begun to question the safety of one of their most safely guarded possessions: money. But what is the best way to protect one’s cash?

Over the years, we’ve all heard of random places to hide money: under the bed, in the freezer, buried in the backyard, in the Bible but where is the best place to put it? My grandmother hid cash for years in the back of her closet between some old quilts that were never used. No one knew about this until after the passed. My husband’s grand-father hid his money throughout his home. He told his widow from his deathbed to throw nothing away in that house without fully going through it. Still to the day, she’ll be going through some old book or other item and stumble upon a $100 bill. Perhaps this was his way of always making sure she was taken care of, but more than likely; he felt it was safer than putting his money in a bank. A close family friend is said to have “millions” of dollars buried in his backyard under a fig tree and while I don’t know if it’s true or not, it does make for a good legend. I’ve often wondered if upon his death, anyone will visit his backyard with a shovel to look for buried treasure!

Of course, burying cash in the backyard is nothing new. During the Great Depression Era, it was common for folks to make “treasure maps” and place their valuables in the ground in coffee cans or old metal boxes. Today a “Ziploc” brand bag, placed in a piece of PVC pipe is a common way to bury cash five feet into the ground. In fact, there’s even an “invention” floating around on eBay called the “Midnight Gardner”. The device is actually a simple twelve by four inch capped, watertight PVC pipe which is said to hold as much as $4,000 in gold, silver, or cash.

Is it a good idea to bury cash? Some say it’s not as the paper money will lose value due to inflation. These individuals recommend investing in gold bullion and burying that as it will hold it value better than cash. There are those that say if the economy got to the point that money invested in banks was gone, that paper money would hold no value either. Others still insist that burying money/gold/etc is a bad idea because it can be easily forgotten or lost. Then, there are those that say that any attempt at “playing it safe” and pulling money out of the economy only worsens the effect of the recession.

In the end, I’m of the opinion that what to do with money is a personal decision and should be made by each individual with regards to what they feel is the safest route for them. As for me, I’ve got a personal stock of cash that I’m seeking a place to hide away for a “rainy day”.

The History Of Paper Money

Sunday, November 16th, 2008

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It is well known that paper currency or paper money was first created by the Chinese,who also incidentallyworld paper currency invented paper around 100 AD. The development of paper money in its earliest form can be traced right back to the 7th century. In the year 812, as a temporary solution to massive copper shortages, a Chinese Emperor started issuing paper money as a form of currency to aid trade, and this caught on so well that by the year 970 it was considered as a dominating type of currency in ancient China.

Stag skins, bark, or parchments marked with the imperial seal as “bills of payment” were used as a form of paper money during this time in history, and the penalty for those caught counterfeiting was death.

Before Marco Polo came back from his many voyages to China, dated between 1275 to 1292, the people of Europe initially doubted that the Chinese effectively used paper for as a form of currency, and paper money only began circulating in Europe 300 years later. However, the use of paper money ceased in China in the year 1455.

Paper currency had a lot of problems in gaining acceptance in Europe, although leather money was temporarily used around the year 1100, as a substitute to silver when the precious metal started becoming scarce. The history of paper currency in Europe started as emergency money substituting regular money such as coins. The first emergency paper bills are dated back to the year 1483 and the first bank notes were printed in the 17th century.

In 1161, a Swedish bank starting issuing paper currency but the money quickly lost its value when the bank started flooding the market with it. These first bank notes carried a guarantee that it could be traded at any time for coinage. Interestingly the name of this bank note was ‘cash’, a term that we still use today to describe paper money. The oldest existing bank note in the world is the 1000 ‘cash’ note of the Ming dynasty.

euro paper moneyThe usage of paper currency only caught on in Europe in the early 1700’s, when the French Government officially began issuing paper currency. The idea came from the paper receipts goldsmiths often gave their customer as a proof of payment and these receipts can be exchanged for gold as and when needed. This act was a milestone and was so significant that money was seen as a representation of valued commodity, as its exchangeable for silver and gold anywhere. A piece of paper currency is as good as a guarantee by the issuing institution, either the government or the bank, that would ensure the holder of the bill receive a predetermined amount of silver or gold from its reserves when it is produced. This is where the system in which money was backed by gold originated from, with the exception of times of war or national emergencies when paper money was supported by actual supplies of precious metal. This practice, however, ended in 1971.

Today, paper currency can be exchanged for almost any form of goods or services, in its value in return. This monetary system has proven so effective for so long that it may take a very long time before the currently emerging electronic money, as we know it today, will be commonly used as an alternative currency to paper money.