Money Management

I Only Used Cash For 30 Days — Here’s What Happened

By Monday, July 05, 2021

The Habit:

Cash-only? That’s so 2001.

As the old folks say, “If it ain’t broke, don’t fix it.” Growing up, I had relatively little-to-no debt. Unlike many of my friends in college, I never fell into the lure of credit card offers once I turned 18. Like every other high school sophomore, I was taught, “There is no such thing as a free lunch,” and all that other economics hoopla. And in life, I was always told, “Nothing in life is free” in one iteration or another. So I always felt suspicious of anything that felt or came too easy, especially free money aka credit cards.

And yet, life happens.

Somewhere in my mid-20’s, I fell into the temptation of swiping. It started off as me hastily accepting an offer for a pre-approved card from Credit One (the devil) for a measly $500. At the time, it felt like $5 million. I really needed the money and promised myself that I’d only use it to pay off an emergency debt and then close it out. 

Yeah, that didn’t happen. 

My credit line increased and I received more and more card offers and within two years, I was juggling three cards and landed in more debt than I’d have liked. The cards I owned included:

  1. A Bank of America credit card
  2. A Credit One card
  3. A travel card

After a few years of spending more than I could pay off, I decided to get my finances in order. By then,  I understood that credit was necessary to be a thriving adult in America. However, my goal was to *only* spend what I knew I could afford to pay at the end of the month. And while I’ve made great strides to drastically decrease my remaining monthly balances (thanks to an increase in income between the ages of 27-30), I’ve failed to make better decisions in how much I actually spend each month. This means that, while my credit card balances have drastically lowered due to nearly zeroing them down each month, I hardly ever save for a rainy day.

The Gameplan & Goal:

Out of sight. Out of mind. Out of money.

That’s pretty much how my demise to balance my dollars went throughout the past years. I view credit as being out of sight. Thus, my debt is out of mind. And then, I’m out of money.

My goal for this challenge was simple: be on a cash-only diet to create better, tangible awareness of my finances. Just like one TFD writer said, it isn’t so much that I’m broke, I just don’t manage my money well.

Since I get paid weekly, I would go about doing this by literally taking out whatever cash I had left each week, after paying bills. And yes, my bills are paid all electronically.

The idea was that, if I had cash on hand when it came time to actually spend it, I’d have more mindfulness and intuitiveness on when, how, why and what I spent my money (on).

Mandatory Expenses

  • Paycheck: $998 / week (net, after taxes) = $3992 / month
  • Rent: $1150 / month (roommate)
  • Utiliites & Wifi: $ 150
  • Travel / month: $125 (commuting)
  • CC  zero-ing down: $1186

Idea Budget For 30-Day Cash-Only:

  • $1,381 / month
  • $345.25 / week
  • $46 / day

It’s important to remember that this weekly amount (of cash on hand) varied each week, based on which bills I paid through automated payments or electronic payment systems. But ultimately, I estimated that I should have a little less than $1400 extra to spend each month.

Also, my automated pay system did not include: grocery shopping, food or any shopping or extras *at all.* Realistically, I do need to eat and this was money I planned to take out of my cash. Unrealistically, I do enjoy self-care.

This also didn’t include an upfront payment to my savings. Yet, while my savings was not part of my bill pay or cash expenses, it was something I kept in mind when spending my money. As I’ve shamefully admitted, I’ve failed to place any money into my savings for a very long time. My savings has remained the same balance for years — which honestly isn’t saying much. I do, however, pride myself in not ever taking anything out of it.

So, on top of better money management, another huge goal with this challenge that I wished to accomplish was a habit of saving. After all my calculations, I felt placing a minimum of $300 into my savings monthly was doable with discipline.

The Results

Should I wait now to tell you how this went or should I wait later?

By the end of the 30 days, I had $220, cash on hand. 

I wish this could be a success story in the greatest of ways. It’s not and I’ll admit that a huge part of me hates that it isn’t. I really wanted to say I saved a minimum of half my dispensable income calculated… but nope. Instead, in the end, I deposited $200 into my savings and held on to $20 since payday was the next day and I  knew that a few bucks would be enough to get me through 24 hours since I literally needed nothing between now and then.

Here’s a breakdown of what happened:

  • Week 1: Having as much cash on hand did the opposite of making me want to save. It made me spend. It sounds ridiculous but something about knowing my bills were paid and that what was in my wallet was surplus, made me gluttonous with spending. Or maybe subconsciously I knew that I could always resort to a credit card. Who knows?  I do think a contributing factor was the fact that, for the first week, I had about $500+ cash on hand. I started my 30 days the week after I paid rent, so bill pay was drastically lower at the kick-off of this challenge. This meant more money in my checking to withdraw for cash.
  • Weeks 2 & 3: Way more discipline, moderation and awareness of my money. This was partly due to my desire to make up for a crappy first week and also because I knew my cash depended on these weeks. By week 4, I’d be handing over rent. So I guess the sense of urgency contributed to my self-control.
  • Week 4 (final) – The discipline I wish I had the previous weeks. Bills paid, with the majority of my expenses being necessary spending and zero outside foods.

Pros:

  • I actually put money into my savings account. Previously, I would always zero-down (or nearly zero-down) my checking the day before payday. This was because I knew I could — and would — get paid the following day.
  • I never broke the challenge nor swiped a single card. I was tempted to once when I was out with friends for drinks but realized I left my card at home. This was week one, so, unfortunately, this was part of my frivolous cash binging, since I decided to overcompensate by just spending more cash at the bar.
  •  I got way less pricy takeout. Like, I only got it once and selected the option to pay cash upon delivery. Aside from that, I just didn’t buy takeout at all.

Cons:

  • I didn’t save as much as I would’ve liked.
  • I still spent money on manicures, pedicures, waxing and other stuff. I believe in self-care but I also believe I could scale back on frequency.
  • I still spent cash on coffees and some light foods (like a breakfast or lunch sandwich, here and there), that I could’ve easily saved on by eating at home. Not often, but still. 
  • While I did not spend money on online shopping or Amazon, I did purchase a Tory Burch purse, in-store ($198 + tax), overshopped on groceries (by not planning a list ahead of time), and made a Target run that cost me about $80 more than it should have.

***

In the end, I’ve come to terms with the fact that I may need to start using an actual tracker or some sort of app to help me budget my expenses. I do think having a flexible spending habit of both cash and card is necessary for my personal financial journey until I actually lockdown on the discipline of it all. Currently, I’m doing the steps in this challenge again but without an end date. And with a tracker. It’s more so just to teach myself how to better handle my money.

We’ll see how it goes!

Leya is a writer and chocolate enthusiast from Philadelphia. She lives in Brooklyn with her twin brother and loves all things memes, cats and cat-memes. 

Image via Unsplash

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