From Plastic to Cash

Ok.  I’m going to try it.  With great trepidation.  On my terms.  Does that still count?

In chapter 4 of The Money Saving Mom’s Budget, Crystal encourages us all to ditch the plastic for three months.  Well, there’s no time like the present, and considering our fifth baby is set to arrive in August, I’d say May, June, and July are it!  We’ll see if I’m converted after that.

The Excuses

One glance at the comments on my Plastic Excuses post, and I know I’m in good company.  The reasons to swipe a card are many, and some I’d say are even quite valid.  (I support ’em, because I use ’em!)  One that came up over and over again that I still struggle to wrap my brain around, though, goes something like this:  “I (or my husband) spend cash way faster than we spend with the card.  Cash just flows through our fingers.”

I’m not buyin’ it.  Here’s what I don’t understand (and take this from a truly “I don’t get it, because I’ve never tried the all-cash system” stance):  Once it’s gone its gone, right?  I can kind of see where some might look at a pile of cash and think “I’m rich!  Let’s spend it!”  But… once it’s gone, it’s gone.  That’s the beauty of the system, is it not?

Again, I’m a newbie here, and will likely find out for myself, but my guess for those who “spend more with cash than with the card” is that you don’t have a cash problem, you have a decision making, planning, or self control problem.  (Hoo-wee, that sounds harsh!)  If you’re in control of your budget, you’re not replenishing the stash at will,and you’re not whipping out the plastic once you run out of green, well then… once it’s gone, it’s gone.  (And we’ll just see what I have to say about that in three months, huh?!)

My Motivation

So why would someone with no debt, no house payment, and decent savings (all while using a credit card for most purchases) give up the plastic?  Good question!  Basically, we’re always up for a challenge.

  • I’d like to prove the theory, right or wrong.  You never know until you try, right?  Kind of hard to toss my two cents in the bucket when I’ve never gone cold cash.
  • Like I’ve said before, my children are getting confused.  It would do them good to see mom and dad make transactions with the green stuff they know is money.  Plastic truly is baffling to them, and this will likely be good for all of us.
  • I really, truly want to see if it makes a difference.  Will my spending change with cash only?  Will I truly spend less?  save more?  become organized?  keep better record?  have extra in our account?  keep my home cleaner?  Ah, well.  It’s nice to dream. 

My Conditions

Yes.  This is where I set myself up for cheating before I even turn the calendar to May 1.  If we’re going to stick this out for three of the busiest months of the year (think graduations, vacations, summer ball, swimming, and such) I’m going to have to allow a few concessions.

  • We will continue to purchase gas at the local “in the middle of a dirt road” co-op gas pump with our co-op card and receive the monthly bill.  I’m not going to stop supporting one of our (very!) few tiny town businesses just to pay cash for gas.  Also, I’m not going to travel 20 miles to fill up.  In fact, as often as I’m on E when I should be starting a trip, that would be a very bad idea, indeed.  😉
  • I have Swagbucks and Vitacost credits, and I’m not afraid to use them!  We’ve got our oldest daughter’s birthday and at least 8 or so graduation gifts to buy this month.  If I can do that without stressing my cash budget in month one, I’m doing it!
  • I’ll still pay for my monthly Azure order with the card.  And I’m so very excited that our 23-week produce CSA starts in May!  I payed for it already, so soon we’ll have a weekly veggie drop that is sure to ease the amount of green flowing through my fingers.
  • My goal here is to quit the plastic, not tighten the belt.  May is looking to be a bit of a spendy month for us (what with extra gifts, traveling, our yearly pool pass fee, etc.) and we’re good with that.  We’ve planned for it.  I will not freak out.  I will not freak out.  I will not freak out.  It’s all about averages, and right now I simply want to develop a new green habit, not new spending habits.
  • I’m limiting the challenge to groceries, household, and out and about expenses.  At least for May, I’m not setting out to change my plastic/automated/check writing world.  Baby steps!  I’ll hand over cash for groceries and household expenses, and also for anything that comes up while we’re traveling (which might be the biggest challenge of all).  In fact, I practiced just yesterday when I paid for my Caramel Frappé and my gardening plants with cash.  Proud of me?

I know many of you are cheering me on from your own experience, and I do hope that a few of you proud plastic carriers will join me!  Find your motivation.  Make your own concessions if need be.  We’ll do this together!  Will cash make a difference?  Here’s to finding out! 

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  1. Meredith says:

    “for those who “spend more with cash than with the card” is that you don’t have a cash problem, you have a decision making, planning, or self control problem…” I couldn’t agree more! With the exception of gas, we use cash also. It’s done wonders for us, though we started this because we were in debt, but now we’ve kept it up! Good for you for just seeing if it would work for your family. Maybe it won’t, and that’s okay, but at least you can say you tried. We love a good challenge, too! Good luck!

    • Yes. 🙂 I absolutely REFUSE to say something won’t work unless I give it a good try myself.

      • Meredith says:

        I put my sister on a ‘credit card challenge’ to see if it lowered her spending. She was very comfortable, financially, and paid off the bill each month, so she wasn’t too responsive because she could afford the bills…. At the end of the 3 months, she couldn’t believe how much less she actually spent. That was 2 years ago, and she hasn’t gone back!

  2. We started day 1 of our marriage on a cash budget…and I really wouldn’t do it any other way. With a cash budget system, I KNOW how much money I have…I don’t worry or wonder. It’s a big security system for me.
    We do use our debit card (or PayPal) for things we buy online, because you cannot use cash. 🙂
    You can do it! And I have a feeling you’re going to love it!! I think you’ll find that you spend a lot less.

  3. we have no credit cards(we might have no cards but we do have cc debt from years ago when we did use them)..the only plastic we use is a reloadable debit card used for autopay on a few bills(which we only put on it what we need) and when dh goes out of town for work so he wont lose cash, so we wont stop using it.

  4. I am really interested in what you come up with. We do the credit card thing. The only debt we have is a mortgage payment. Our payment is about 15% of our take home pay. We track all of our card purchases in a spreadsheet, so we get an idea of when we should slow our spending in a given month…or when it is ok to go out for dinner! I guess I always figured since we honestly have good self control because we know how much we have spent in any given area on a daily basis.

    • I think knowing how much you spend in each category is a HUGE step forward… now if only we could all figure out how to spend LESS in each category. 😉

  5. The biggest challenge I would face here is online purchasing. I have to visit Amazon at least once a week and plastic is the only way to get there! I have been watching “Til Debt Do Us Part”, which is a great show and a cash-only advocate. So, I’ve already adopted the habit of writing every single purchase down in a notebook, so when my cash disappears, I know where it went.

    • I purchase a significant amount online, too. I *think* it’s all stuff we need 😉 , but I may do a double-take in these next few months!

  6. Gas was the big exception we made when going from plastic to cash. We set up a separate checking account with separate debit cards specifically for gas/auto expenses only that we transfer money to each week. Helps us stick to our budget and have the convenience of pay at the pump.

    • I try really hard to be mindful of my trips to town, 1) because of gas prices, and 2) because I’m a homebody and don’t like taking the whole stinkin’ morning to go somewhere! But honestly, we don’t pay much attention to what that gas is costing until the bill comes in the mail. Probably need to take a second look at that.

  7. Well I am one of those who said my husband spends more with cash. I think our problem is that we don’t have a “when it’s gone, it’s gone” mentality, because we aren’t great with budgeting. Yeah, it’s that lack of discipline, self control, or whatever you said. We aren’t “rich” by any means but we have no debt other than our mortgage, live a comfortable life and have a good amount in savings. If he spends the pile of cash, no biggie, we’ll just go withdraw more, knowing that we have a cushion to fall back on. So before I decide credit or cash or what’s best for us I guess I need to go back to the beginning and create a budget that we can really stick with. And then learn to discipline and self control to do it.

    • “go back to the beginning and create a budget that we can really stick with. And then learn to discipline and self control to do it.” I think you’re on the right track here! (says the girl who may have to do that herself… because we sound a LOT like you in that department 😉 )

    • I can relate- For us, whether it’s a credit card or the “miscellaneous cash pile” the idea of a cushion keeps us from really pushing ourselves to cut back and examine our spending habits.

      Our goal is to name the items that come out of the miscellaneous category, and allocate money for specific things that we value (soccer fees, baseball shoes)and then decide what else we want to spend on for the month (trips to the ice cream parlor?). This is instead of our former typical pattern of running out, getting the ice cream and then getting more money to cover the other “fun” stuff. For us, this small change was the difference between standing still and moving forward towards the goals we are working towards.

  8. We’ve been on a cash envelope system for 2 1/2 years. It was scary at first but now it is so comfortable. I know that when the grocery budget starts to get low and the month isn’t over, I have to pull out some frugal meal recipies. And then there are months when we have more cash left in the envelope so we can choose to stock up on an item or two that is on sale or splurge on a meal! It really helps to explain to my son that I cannot buy that certain convenience food item he wants because I only have so much $$ left in the envelope. And I can show him so he understands.

    We also have envelopes for gifts we have budgeted for the year, an envelope where I put money back for the side of beef purchase once a year and envelopes for home repair, car repair, etc…. Of course we do still pay many regular bills (utilities, insurance, cell phone, etc.) through the automated bill pay through the bank. But most everything else is cash from an envelope. Keeps me from stopping at Tim Horton’s for an English Toffee – I know that $$ could really be a gallon of milk for my family so it makes it easier to pass up!

    • We do quite a bit of our food buying in bulk, also. A Whole pig, 1/4 or 1/2 of a beef… obviously I won’t have that money totaled up in my 3-month experiment, but I’m going to at least start it and see where we go!

  9. I have used a range of systems over the years and, being naturally frugal, most of them have worked for me. At one point I carefully tracked everything I spent and that helped cut down on spending, but it was time-consuming. A little later, I was saving aggressively for a house and had enough additional stressors in my life that tracking my spending felt really overwhelming. I used my own version of the cash system and saved very successfully.

    I factored in my bills (rent and utilities, primarily) which were paid by check or online and figured out how much I had left to spend each month after my fixed costs and saving goals. I took that money out in cash at the beginning of the month and put in my wallet. As long as I had cash, I could buy whatever I wanted. When I was out of cash, I couldn’t buy anything (including groceries). Overall it worked really well. It was nice to have the flexibility to spend on different things and emphasized the trade-offs between things (such as going out of town for the weekend versus eating out versus eating fancier meals at home). There were definitely months where I ran out of money and had to eat out of my pantry for a week or so (beans and rice anyone?), but since I was single at the time that was a trade-off which was mine to make. I kept the system up for about two years, till after I bought the house and had a little more disposable income.

    Since then I have gotten married and I feel like we spend rather more freely. I haven’t yet come up with a system that works as well for two people, but I don’t worry about it too much since we still save a very significant percentage of our income.

  10. I have *loosely* been gravitating toward the cash system! 🙂 I keep track of all our expenses and have categories for everything, so I know where we’re at even using our card, like someone previously mentioned in the comments. But I have been wanting to see if cash helps cut my spending and it is nice to know I don’t have everything coming due on my plastic. We always pay our card off every month and I do earn points that I cash in for gift cards. But I do *get* the argument that you spend more with plastic!

    Good luck and have fun in your 3 months ahead!

  11. As someone whose husband falls in the “spends cash like water” category, I do recognize that it is a decision making problem, but since it happens less with plastic than cash, I won’t ask him to give up the card. We do pay for groceries and household items with cash, which is infinitely easier than trying to track the receipts or check the credit cards frequently!

    • {ahem} My husband doesn’t even know about my challenge yet! But I hear ya. I’m not going to worry about his spending habits, just mine. Actually… since he walks to work and walks home and eats the school lunch… he really doesn’t spend much of any money at any time. It’s on me. Ack! 😉

  12. Debbie Jennings says:

    Hubby and I get an allowance every month of $XX. I also have a pre-paid credit card that we put $100 on each month. Yes, it does cost 2.95 a month, and I pay $2.95 when I put money on it, but this is OK with me. I use this card exclusively for internet purchases. If we have something come due as in our virus protection update, we add that much to the pre-paid card. I can check my balance and see all of the purchases I have ever made online. This doesn’t work for everyone, but it does for us. We also have a set amount of money set aside for groceries, or household purchases. We have money set aside for emergencies, such as needing a new air conditioner or refrigerator. We are trying to get all of our credit cards paid off and cancelled except for one. That one will be strictly for travel. We do have a credit limit on it, and if we go out of the country, we always call and let them know which country we will be in so we can use it in an emergency.

  13. I think in a previous comment I mentioned how much I love ING, it’s great for allocating money to different area’s of your budget. I have different categories for things like our sams membership, water bill, and insurance so I can keep track of how much I’m saving so when the bill is due, we have the money.

    But I think if you can’t control your spending, a cash budget won’t solve your issues. You need to deal with the emotions behind what makes you over spend:)

    • We have an ING account, too! I love being able to separate the money into the categories we’re saving for.

    • “But I think if you can’t control your spending, a cash budget won’t solve your issues. ” Definitely the bottom line to all of this!

    • “But I think if you can’t control your spending, a cash budget won’t solve your issues. You need to deal with the emotions behind what makes you over spend:)”

      Agreed. A cash budget doesn’t solve spending issues, it just means that when you don’t have any more you cannot spend it, doesn’t necessarily mean you are spending it wisely.

  14. You guys are so “with it” already it may not make a huge dent. BUT I bet you will spend less on the nickel and dime you to death stuff. When we first got married we decided to get personal spending cash every payday for EVERYTHING personal (clothes, shoes, lunch out without the spouse, STARBUCKS!) and I tell you what, that Starbucks was no longer as appealing when I had to fork over part of my $50 cash. Now that my children want cake pops and we got a Starbucks gold card thing I do not use my $50 and I am consuming an extra 300 calories of Starbucks every week on the “house” budget.

    • Ha! I think you’re right. Since we tend to do more fun snacking and such while out and about in the summer, this will be a good lesson for the kids, too. “We have this much… should we spend it now, or save it for something later?”

  15. I LOVE sticking with cash. “When it’s gone, it’s gone” makes it like a game to me; it’s so much fun getting to the end of the month and finding that I still have a bunch left!

    • I think I’ll have fun with the “game” aspect… if I don’t get too tired, hot, and worn out from pregnancy and summer. 😉

  16. Thanks for your efforts to help people get debt-free. It is one of our greatest needs in America today. Good post.

  17. We’ve done cash only since November, with one exception – gas in our cars. And that is purely selfish, I don’t want to lug all three kids out of the car to buy gas and I certainly won’t leave them alone in the car.

    But for everything else, like eating out, groceries, crafts, etc, we’re only using cash. And it’s been so good for us. Some months we’ve had enough left over to pay off more debt, which has been awesome.

  18. I just started using the cash envelope system about three months ago and I can’t tell a difference AT ALL. Maybe because I am disciplined and have always used a budget. When I really had to watch every penny, I wrote down every penny… I had a notebook where I put my spending limit, say for food, at the top of the page and subtracted every receipt I got. I quickly found out that I spent too much at superstores so I quit going to them. Right now I am not spending any money on anything unless we NEED it… so I do have some extra cash for the beach trip we have planned for May. But if I wasn’t doing this, I would be using that money to stockpile for the future. I really don’t “go crazy” and spend money without thinking. But it may be in my genes… I’ve never been too much of a shopper. I am interested to see your results just to see if you think it makes a difference.

    • ” I just started using the cash envelope system about three months ago and I can’t tell a difference AT ALL.”

      I experienced the same thing and lost all my cash rewards on my Amex. It was more of a hassle to carry around cash for me 🙂

    • Honestly, I think discipline trumps cash or plastic ANY day. 😉

  19. Sarah in GA says:

    i was going to say last week too that for us using the cash system actually saves us some time and frustration in that i don’t spend time tracking each expense separately in a spreadsheet or anything. i know how much money is in our “clothing” envelope so i spend out of that and don’t even bother to enter the receipt anywhere else because i can see where the cash is going. for me it works great because i was never able to stick with entering all our receipts into another program.

    as for bulk purchases, it has taken us a year or two to figure that out. the first year we paid for our CSA we didn’t have an envelope, so what i did the next year was take the monthly amount in cash out of my grocery cash, during the time we received our CSA produce, and put it in a cash envelope so that it was all there next year. (did that make sense?)

  20. We have a pretty thorough budget/tracking system, but we still use a debit card. This month we’re forging forward using cash for our discretionary spending: groceries, entertainment, gift purchases, etc. We’ll see how it goes!

  21. So funny! When I started reading this post, I thought by going no plastic, you meant no plastic grocery bags, etc. LOL! Love the idea, and will be following you to see how it goes.

  22. So I looked up CSA— I’ve been kind of interested in this for a while now. Do you find it’s worth it money wise? is it a weekly cost? Do you get a head’s up notice what you’re getting so you can make your meal plans around it?…:) Thank you for the link in today’s post (friday april 27th). -Brittany

    • Well… this is our very first year with a brand new CSA. I’ll have to let you know later on if it was worth it, but I’m so excited about it! Good question about knowing ahead of time. I might ask my farmer that one!

  23. I just posted my update on my blog about how my first month went going card-free. I love it!

    I had to laugh this morning though. Yesterday was payday so I was going to stop by the bank this morning on the way home from the chiropractor and pull out this paycheck’s cash…only to remember that my card was still in my drawer at home! At least I have a few other things to do today, I’ll just add that on the list!

  24. I had the same excuses when I first considered paying in cash. It’s HARD to throw out a system you think has worked well for most of your adult life.

    Many years later we still use cash to pay for everyday purchases with the exception of gas and a few other things. It has been one of the key factors to keeping us on a budget. I can SEE how much I have in each envelope after making a purchase and it makes me hold onto the money even tighter.

    I think twice about that Starbucks coffee when I have to watch the cash come out of my allowance envelope!


  1. […] use a modified envelope system for our monthly purchases. Instead of dividing our monthly cash by category, we divide it by week, […]

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