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Converting to Cash


Going back to my recent post on The Cost of Convenience – Snack Time, I am finding the temptation to overspend or spend in situations where I don’t need to has become more of an issue as my debt load and monthly obligations continue to drop.  I have more available income and carrying plastic around…well, I have found myself making some bad decisions.  So effective immediately, I am converting to an all cash system.  I’ve cut up two of my cards and put the others away.

I will still pay my monthly bills online using either my debit cards or bank bill pay.  But for any “spending money” I will be withdrawing the money at the beginning of the month and sticking to it.  This money will be my grocery money and the money I would pay the kids for work (since they no longer get an allowance.)  And I’m debating the car money.  Obviously I have to get gas at least twice a month, and paying with a plastic is most convenient.  Not to mention maintenance, etc. that is not always predictable.  I’m considering opening a car only account (checking, that is, not credit) and using that card only for card related expenses.  Thoughts?  But since on most months there are monies left over for that budget item, I really want it in an interest bearing account.  So I’m still figuring that one out.

But essentially I am taking away all possibility of over-spending on a whim or giving into the temptation of convenience or acquiescing to the kids’ “mom, can I have this?”  And when the money is gone for the month…it’s gone.  The kids are used to this on a smaller scale as I’ve been trying it out on a weekly basis…and I’ll just tell them, we are out of  spending money for the week, we have to make due with what we have.  And they are getting that.

Teaser: New monthly budget coming soon as we have cut back on some other expenses to keep us on target for our 6 month credit payoff goal!


  • Reply Cathy D |

    I just love that you have been able to figure out what is working for you and what is not! Sounds like you are really trying to keep on top of this budget! You go girl! I struggle with this as well. You may find that writing down where your cash goes makes you feel better. I feel like it just slips through my fingers so quickly when I have cash. I go to the bank each pay period and get cash in one dollar bills, five and tens so that I don’t have to give my son more money than necessary and not get change. My husband is the worst! He has no concept of a budget. You are teaching your children how to stay within a budget and when it’s gone, it’s gone! Wish my husband had learned this growing up. My goal is to teach my children so they will be a better spouse one day when they are grown. Kids need to know there are limits to spending and we need to make priorities. Your kids are surely getting this with all the changes you have made this past year. Keep up the good work!

  • Reply Walnut |

    A couple thoughts –
    1. I think using cash for grocery store type spending is great if you have a tendency to hold onto cash. I would put the cash in the envelope and keep a running total on the outside. I would also keep all receipts of cash spent in the envelope as well. It’s a great way to see where you are at as the month goes on.

    2. I really hate opening multiple accounts for specific purposes. I used to do this and it was so hard to keep track of where my money actually was. I found that it was easier to have 1 checking account, 1 savings account and 1 credit card. All three were at the same institution so I always had full visibility to my balances. I keep a close eye on my credit card spending and record all transactions in my budgeting spreadsheet, so I knew exactly how much I was spending on different things. I also split the savings account into various buckets using my spreadsheet. This allowed me to remember that the money in the savings account was earmarked for car insurance or other irregular spending.

  • Reply Adam |

    A personal blog operated by four different people who contribute tips and advice on getting out of debt. Includes a question and answer section where specific reader questions are addressed.

So, what do you think ?