I’m just gonna come right out and say it—I love shopping. Whether it’s for clothes or books or school supplies, shopping can be a way to get back in touch with myself, bond with my family or friends, or recover from a bad day.
But I also try to be pretty careful with my money. I have credit cards I keep track of and pay off in full (almost!) every month, and I’m a big fan of cash back, but recently I’ve come to the realization that credit cards just don’t always work for me. Something about the gleeful swipe of plastic on plastic makes me forget that I’m spending real money, and the dollar numbers that I set in my budget tend to start feeling wishy-washy and open to interpretation when they’re nothing more than numbers on a screen. In particular, I often found myself blowing my grocery budget when I paid with a credit card—even though those groceries seemed to melt into the vast expanse of my pantry when I got home, leaving me feeling like I still had nothing to cook.
At the same time, I also felt guilty and anxious whenever I spent money on myself because it was difficult to do all the mental math on the go in order to decide whether a purchase was budgeted for: had I already spent my $50 for the month on clothes? Or could I count my birthday money, or maybe my cash back for this month? I was beating myself up whenever I bought something not strictly necessary, and sometimes overspending in categories I felt were more “justified.”
The cash method for groceries and personal spending
I’d heard of the “envelope method” for budgeting in cash before, but quite frankly couldn’t imagine myself going to all the trouble of sorting out cash into various envelopes. Plus, most of my recurring expenses—rent, utilities, internet, phone bill—were paid online, making it tricky to imagine tracking them in cash envelopes. I decided to use a variation on the envelope method: using cash only for my two biggest spending traps—groceries and personal spending (like clothes, toiletries, and accessories).
At first, I set a fixed dollar amount for personal spending and a fixed dollar amount for groceries. I took out the amount in twenty-dollar bills at the beginning of the week and put them in my purse in two separate sections with the intention of strictly limiting my spending in these two categories to the money set aside in their respective envelopes. But I quickly realized that I was much more motivated to save if I let leftover money move from one “envelope” to the other—I could forgo my latte for a jar of Nutella, for example, or skip the chicken dinner in favor of a new candle or cute top. This motivated me to save in both categories and also made the logistics much easier—just one stack of money to keep track of!
If an expense came up that fell into one of these categories but couldn’t be paid for in cash, I could still whip out the credit card, but I moved the corresponding amount of cash out of my wallet into a location where I could “withdraw” it at my next ATM withdrawal (it was my glove box—shhh!). Under no circumstances could I just spend that withdrawn money—it was like it was back in the bank. So, if I had $20 hanging around in the glove box at the beginning of the next week, I’d withdraw my usual amount minus the $20.
At the end of the week, I took any cash left in my wallet and put it in a prominently-placed jar with a dedicated goal. My goal was to save money for travel, and this goal motivated me enough that sometimes I would put some cash in at the beginning of the week, hoping to trick my brain into forgetting I had it—and it often worked! Having the physical presence of a jar (and seeing bills stack up in it rather than uninspiring change) proved really motivational in helping me to save.
I knew this method would help me stick to my budget. But I didn’t anticipate all its long-term effects. For starters, of course, my budget has gotten a lot more predictable—just one simple, round number withdrawn from my bank account once a week (of course, you could do this monthly or bimonthly or any other way—but I’ve found that the weekly ritual is a good reminder to myself that this is a method I’ve invested in, and the weekly dollar amount is easier to keep track of).
I’ve also found that I am far less likely to drop a huge amount of money on suddenly “necessary” items, like personal care items, household items, or the aforementioned groceries, because I know the boundary already has been set. Sure, I may need both hand soap and sponges, but if I buy hand soap this week and wait on the sponges until next week, I can easily still survive—and my budget for this week can stay intact.
I am also far less likely to fall for the “buy more and save” marketing ploy (something that is definitely a real savings in some instances, but not always). Fifty paper towel rolls might be cheaper per roll, but it would blow my budget for the week—and I really only need one. Down the road, I might find I never needed 50 paper towel rolls in the first place! I’ve found that spending just a little “more” for less stuff has helped me realize what I really need, and in the end saves me money.
Relatedly, I’ve found that my relationship with my belongings has changed dramatically. I now get a genuine thrill out of using up something and throwing the package out, because I know I’ve maximized my use of that product—and that translates to more money to spend on the things I really love! Using cash helps me remember to really take stock of what I have (do I really need more laundry detergent, or do I have a container stashed somewhere?) and maximize my use of it. Strangely enough, using cash helps me see more clearly through the cash to the things that I want. I now see money as a means to things that make my life simpler, easier, or more beautiful—not as an abstract number stressing me out.
A lot of the stress I had around money has simply melted away. I no longer go back and forth, anxious about whether a particular purchase is justified (okay, I don’t do it often). If the cash is there, it’s okay to spend it. If I have leftover money at the end of the week, it’s okay to treat myself to a latte or takeout. When it’s time to stop spending money, I won’t have any left! It’s a pretty simple principle, but it’s no exaggeration to say it’s radically improved my life.
And now, if you’ll excuse me, I have some guilt-free shopping to do.