Budgeting Tips: Use Cash for a Week
photo credit: Unhindered by Talent
A lot of the money we spend seems to get frittered away on cups of coffee, bus rides and impulse chocolate buys. Although each of these purchases might be just for a couple of dollars, the dollars add up and this kind of spending can be one reason we can’t save money.
The Financial Planning site at About.com recently wrote about a really simple tip to help get this kind of spending under control: use cash for a week.
The idea is that you should first work out how much money you think is the maximum you should spend on these impulse cash purchases. There might be other payments you need to make during the week in cash (for example, paying the parking meter when you go to your French class after work) so make sure you budget these in too.
Then put only this amount of cash in your wallet at the start of the week. No more! During the week, you will physically see the amount of money reducing and if you haven’t got any left for a Starbucks coffee on Friday, you’ll have to make do with the coffee you can make for free at work. The idea is that physically handling the money is a whole lot different to just seeing a number going through your account as you swipe your credit card or write a check, or even if you’re just handing over cash and going to the cash machine for more whenever it runs out. Hopefully, a tip like this can help cut unnecessary spending and you can see where your money is going.
This entry was posted on Friday, September 5th, 2008 at 5:52 am and is filed under Budgets & Money Management. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
