Spending cash – a lost art?

There is much talk of how we have lost touch with what and how we should be eating – fast foods, processed foods, modified foods, busy lives have all lead to ill-health and increased weight.

In much the same way, we have lost touch with the way we should be spending. Credit cards, revolving facilities, online shopping have all contributed to us being removed from the spending process leading to poor financial health and increased debt levels.

I can remember when people got paid in cash in a brown envelope and they used that money (and only that money) to cover their expenses for the week ahead until the next envelope arrived. Now the money goes straight into a bank account that you access via a card and often keep using until it says “Declined” because you can’t keep track of all the little amounts here and there that have come out of the account.

Some accounts let you keep spending even when all the money has gone and others let you spend money you never had in the first place. Then there are the schemes where you put all your expenses on a credit card and pay it off at the end of each month which means you are spending money before you get it and always paying backwards.

Try spending in cash

All of these can make it very difficult to keep track of your spending and lead to a feeling that you aren’t in control of your money. If this is you, try spending in cash for a while. Leave money in your account to cover your bills and savings. On pay-day take out in cash your estimated spending on food, petrol, travel and entertainment for the next week/fortnight/month and only spend that. You’ll very quickly see whether your estimate is accurate (or not!) and have a definite point at which you are going to stop spending.

Works with irregular income 

This can also be helpful for those in business who don’t have a regular income source. When money does come in, work out how much of it is available to you as the business owner personally and take that out in cash to spend, leaving the rest of the money in the business account.

Make different spending choices

You might also find you make different spending choices. That magazine that got bought using a card without thinking, might not be so appealing when you see your cash total go down.

Involve the kids

Involve all the family and show the kids what it means to spend the money you actually have. Maybe they will stop saying “just use your card” when you tell them you can’t afford something.

Image by stockimages at FreeDigitalPhotos.net

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