Taming My Cash Spending Trigger
In Day 30 of 33 Days and 33 Ways to Reduce Debt and Increase Savings over at No Credit Needed, NCN says to know your weakness - identify your spending triggers so you can overcome or avoid them. Later this week I’m going to talk about my spending trigger *places* and how I deal with them (actually in response to Day 31 of the same series). But I have a huge spending trigger that isn’t tied to a specific place or external situation - cash.
Carrying cash for me is almost a license to spend. I am a fritterer by nature and I find it very easy to justify in my mind spending small amounts of cash for things I would never get if I didn’t have cash available. For some reason, when I all I have is my debit card, it inhibits me from spending small amounts. But when I have cash, it is like a whole new world opens up to me. I look at coffee drive-throughs, fast food drive-throughs, little trinkets at the checkout line, all sorts of things that with solely my debit card, I do not generally consider. And the worst for me is the “leftover” cash. If I take out $60 to purchase a specific thing that I need to pay cash for, and it ends up only costing $55, that other $5 somehow disappears for me within the next few days. Maybe a latte, maybe some candy, maybe something else. Who knows. But it is gone.
I combat this impulse in my brain in two ways, and one of them I never would have guessed works but for me, completely does. The first is the obvious - don’t carry cash. And generally, I do not. I have done this for a long long time, for I know myself and how I love to fritter away cash. But sometimes, I need cash for a specific reason, or someone gives me cash for something. And when I can’t avoid having cash, what has helped me not fritter it away? Having a budget.
I realized that why cash was so easy for me to spend in the past is because it was kind of like unaccounted for money. Once it was withdrawn from our checking account, or if it was given to me and therefore was never in our checking account, in my brain it was already spent. So spending it had much less pain attached to it for me than a debit card transaction. But now, where every dollar is accounted for, even cash isn’t spent in my brain until it is actually physically spent. There is no fuzzy gray area where the cash is still in my pocket but my brain has let go of it so it can freely be frittered whereever. And that was an important realization for me.
It is all about the attitude. If the money is already gone in my brain, it is as good as gone. But if that money is part of an overall budget and I know where it should be going, if it doesn’t get there, my brain is upset. And that has made all the difference.
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December 11th, 2007 at 7:35 am
I’m the same. I’ve been keeping it under control with a generous frittering budget, but I’m now in the process of switching to debit card only. It’s got a bit complicated since I went away, but I’m sure I’ll straighten it out eventually.
December 11th, 2007 at 7:41 am
Very insightful. So are you saying that even if one had cash on hand and had the same issue you do in terms of it gets spent faster but if they use a budget, it would not matter whether they use debit or cash because one has constrained themselves?
December 11th, 2007 at 8:56 am
Thanks so much for your entry, I can relate, as a matter of fact I am in the same situation - this AM on the way to work I stopped by the gas station (my car has an automatic pilot on it) and stopped for something I DO NOT NEED - just a habit which I am down to one a day (good for me really), but reality is I do not need to spend any extra (not even extra) but do not need to spend on it. As always, Mrs. Paid-Twice, you are right on, Thanks Bill W.
December 11th, 2007 at 9:47 am
I am the same way, especially with larger bills (anything over $5.00). Several years ago I read where someone said they took out their spending money each month in $1.00 bills. I started doing that too - $200.00 each month in $1.00 bills. I only kept a few dollars in my wallet at any one time. I used debit and credit for large purchases however by the end of each month, there was always money left in my cashbox.
December 11th, 2007 at 10:48 am
Yep happens to me every time. I purchased a gift online for my brother to give to my mom. He reimbursed me with cash for the money I had spent. Bad idea. The cash didn’t even make it through the weekend. We ended up using it on fast food and going out to eat. If we hadn’t of had the cash we would have just eaten at home, but with the cash hot in my wallet it was like we just HAD to spend it.
So yes, I can totally relate.
December 11th, 2007 at 11:04 am
I also have the cash weakness! I’m glad I’m not alone!
December 11th, 2007 at 1:29 pm
I’m SO glad to hear that someone else has trouble with cash. I’ve heard so often (think Dave Ramsey) that cards are bad and cash is good because it stops and makes you think about what you are spending. Not for me! Cash just disappears. In fact, sometimes I haven’t even spent it…it just disappears (later to reappear in some odd coat pocket.)
But with a card I know that every single purchase is recorded and will be scrutinized. I have to look back on that $3.29 impulse purchase later when I balance the books and will feel guilty. That alone is enough to keep me on the straight and narrow.
You have to use what works, and what works for me is cards (reward credit cards, actually, but always, ALWAYS, paid in full each month.)
- K.
December 11th, 2007 at 8:17 pm
Cash is hard for me because it seems like at places I’m likely to spend cash, I’m not likely to get a reciept (and I don’t always remember to make note of it). No reciept means I don’t always remember to enter in that transaction, so whether or not it was in the budget I often can’t for the life of me remember where I spent the mney
December 11th, 2007 at 10:39 pm
My story is similar to Chris’. I’ll take out 100 dollars from the ATM and hold onto 20, and leave the rest hidden in my house. If I get cash from other sources, I’ll hide that too until I need it. I’ve been doing this for about 3 months now, and it seems that I always have leftover fun money. My fun money budget is 150/pay period (biweekly) and I haven’t gone to the ATM twice in one pay period. The extra 50 goes to my student loan. It’s great!
December 12th, 2007 at 12:17 am
@Adeem - I don’t know if it would work for everyone, but I do know that when the cash is actually accounted for on my budget sheet I act more accountably with it.
And for everyone else I am happy to hear I am not the only one who has trouble with cash
December 12th, 2007 at 12:18 am
@ Chris & Peachy - My spouse likes to hide money. It works for him too!
I tend to lose it for months if I do that. Organization is not my strong suit