Her Money: Cash Over Card

CASH OVER CARD: How having cash helps you to not overspend.

 

Repeat after me, “CASH IS KING.”

This is something successful CEO of Nasty Gal, one of the fastest growing companies, Sophia Amoruso lives by. She’s never had to talk out a loan for her company and has never had to declare bankruptcy unlike a lot of other companies and she credits that towards only spending what she has and not a dime more.

Dave Ramsey, a financial author and mentor, also operates under the same kind of thinking using and preaching the envelope system.

It’s extremely easy to fall into the quickness of swiping our debt cards and credit cards. It’s how our society works now. Swiping all day but never balancing our check books or budgeting how many times we can actually afford to swipe our cards. Studies show that people spend less when they actually can touch and see the cash that they are spending

This is why I’m suggesting that you too, learn to operate with cash and not your card. Here’s some easy steps to get in the habit of spending cash instead of swiping your card and how to organize it the Dave Ramsey way!

1. Know your current expenses.

Know what needs to go out and what can stay in. Be mindful of automatic bills that get withdrawn, be sure to not overlook them and get the cash out if it needs to be in your account instead.

 

2. Find out how much cash to withdraw.

After you know your outputs, budget how much goes towards what and the total of cash that needs to come out.

 

3. Organize your cash with envelopes.

Have titles for each envelope. For example: Tithe, Gifts, Gas, Groceries, Eating Out, Household Goods, Fun Activities, Clothing and whatever else you and your family decide to budget out for.

 

Now this is the trick, when the envelope is empty of money, YOU’RE DONE. No getting more money out of your account or taking money from other envelopes. You are done spending in that category until next pay day. When there is no more cash that means no more spending. This takes self-control and discipline which this system will help you to develop and cultivate.

With love and big smiles,

torrie.