Most people give serious thought when making major purchases with a credit card or debit card…but what about the small stuff? Do you pop your credit card or debit card out the car window for an expensive latte every morning? What about the $7.99 lunch that you have clearly just “earned” by sitting in a boring meeting for three hours? You really do deserve those things, right?
Maybe we should decide which of our purchases are “wants” and which are “needs.” It can be tough to discipline ourselves in the area of discretionary spending because we do feel better when we reward ourselves occasionally. It’s just that we might be a bit addicted to reaching for our plastic – and even now, our smart phones – to pay for minor purchases. It’s been made so easy for us that we don’t even think about how the costs add up.
A few months ago, I added up all the “minor” purchases I had made in one month using my credit and debit cards, excluding necessities like gas and groceries. It was rather surprising. My budget is really tight and I thought I was fairly disciplined about my discretionary spending. All I included in my tally were the fast food/coffee stops, quick lunches, minor purchases at discount stores (did I really “need” a new throw pillow?), and an occasional matinee movie (no soda and popcorn). Whoa! I really had never realized how much money I was frittering away.
The next month (I get paid monthly), I made sure the money in my checking account was adequate to cover expenses (including putting a little into savings), then withdrew some cold, hard cash. Using cash instead of credit and debit cards, I put myself onto a “cash-only” basis and the shift in my spending habits was immediate and amazing. Whenever I was tempted to zip through a drive-thru for a snack or coffee, or found myself eyeing some trinket in a department store, I would pull out my cash and, 9 times out of 10, I would forgo the purchase. At the end of the “cash-only” month, I had reduced my discretionary spending by more than $100.00.
Of course, you might not want to walk around with a wad of cash, so use good judgment about how much to carry. I try to carry enough cash for a week or two, then replenish when necessary. The funny thing is how I won’t let go of that cash. It’s so hard to hand someone a twenty dollar bill because it’s “real” money; I want to hold onto it because I can see it, and it’s mine. When I hand it to a cashier, then it belongs to someone else. Ouch! If you’re letting your hard-earned money be siphoned off by expensive coffee shops, fast food restaurants, or other places that rely on impulse buying, try the cash-only method. You might like it and you will definitely notice an improvement in your bank account.
