By Chuck Bentley

Cash remains an important part of our financial transactions. Yet, we tend to forget how important it is to manage our cash.

According to the summary of the Diary of Consumer Payment Choice, a national study, cash still has a “dominant role” when it comes to small-value transactions. It also remains essential for lower-income consumers who may not have access to alternative payment options, and it is widely used for retail sector payments.

The study notes that cash “accounts for a relatively small share of total consumer transaction activity at 14%, while electronic methods make up 27% and checks 19%.”

The findings suggest that while consumers may not use checks or electronic payments very often, they prefer those methods for high-value transactions. “The average value of a cash transaction is only $21, compared with $168 for checks and $44 for debit cards.”

I have three tips to help you manage your cash.

1. I recommend that you always carry $100 in cash in your wallet or purse. This protects you from a circumstance where you may not be able to use a check or card to make payment, plus it is a back up in emergency situations.

2. Second, keep one month of your total living expenses in cash safely stored at home in a fireproof safe. This allows you to avoid making runs to the bank or local ATM when you need cash; you have money on hand for travel needs and are simply being wise if you were ever unable to access your bank accounts via the internet.

3. Finally, pay in cash more often. It is one of the last ways remaining to keep our financial transactions somewhat private, which I think is an important aspect of our freedom we don’t want to lose.

Originally posted 4/20/2015.