Money Saving Tips: Use Cash

Welcome to this series of money savings tips which will show you easy ways in which you can gain control over your finances and help you get a better understanding of how to manage your money.

Our first tip is a simple but effective way of having more control over your money.

Use Cash

This is one of my favorite money saving ideas and it is simple but highly effective. It is easy to dismiss ideas like this as too simple but it is usually the simplest things that are most effective. Too many of us rely on credit and debit cards for our day to day payments and this makes keeping track of our expenditures really confusing and difficult. When you spend money on a debit or credit card it can take several days for payments to go through, meaning you can never be quite sure of how much money you have available at any time. The great thing about going back to cash for our spending is that you can physically see how much money you have all the time and set yourself a very clear limit for spending. There is something more real about cash and it can really help you focus on your spending more carefully. By having a fixed amount of cash each week for food and non essentials, you will be very clear about how much money you can and cannot spend each day.

The idea of this tip is that you should set yourself a budget for the month and then decide how much money you should be spending on food and non essentials. Divide this monthly total by four to get a weekly spending limit. Once you have set yourself this allowance, you should take out this money in cash and use it to pay for your food and non essentials. Each week, rather than pay for everything on credit or debit cards, you should use cash for day to day expenses like food and shopping. By using cash you can see every day how much money you have spent and it will make you think more carefully about wasting money. If you overspend, you will simply have no cash left to buy food. If you get into the habit of doing this each week, you will find that you will quickly become much more cautious about overspending. It is important you are strict with yourself and make sure you spent only the money you allocate yourself each week.