The Pain of Paying: Carrying Cash
Remember that epic weekend you had recently? The one where there were multiple day parties, festivals, or bar hopping. Yea, that one! At the end of the weekend, we all checked our mobile banking app to discover we spent WAY more than we anticipated. There are many reasons why this may have occurred but today I want to introduce a concept I call the “pain of paying” and explain why we should all try to start using cash whenever possible.
The “pain of paying” is a concept based on the idea that because some purchases are a little more painful than others, we should try to avoid them. For example, a $200 parking ticket hurts more than paying $200 for shoes. Additionally, even if the price of something is the same, it may hurt more based on if you’re using cash versus a credit card. Whether you want to admit it or not, we have all experienced the pain or tried to avoid the “pain of paying” at one point in time. Can’t you remember that time you decided to use your credit card instead of cash/debit at the store because you did not want to see all that money leave your account at once…yea that was avoiding the pain. Guess what? The reason we feel this way is because the psychological effect of buying something is higher when you physically hand over cash because you instantly feel the impact and notice the money leaving your wallet/purse. With a credit card swipe, we don’t usually feel the impact until the next billing cycle or when we actually decide to check our account.
The pain of paying concept has led me to try to use cash when I can and encourage the people I help to do the same. I personally use cash for my play money, eating out, and other extracurriculars. And before you ask, there are two main benefits of using cash. Visually seeing your money leave your hand can help with the following:
It can help you stay within your budget. Once you spend your allocated cash for the weekend, event, or category (e.g. bar, brunch), it is gone.
It can help curve unnecessary spending. When you know you have to make your cash last for a certain period of time, you might cut back on making those $5 or $10 purchases that add up before we know it. How about that daily Starbucks fix that you think you need or even that La Croix Sparkling water? (I am personally guilty of this one).
Whether its Starbucks, brunches or even festivities for the entire weekend, I challenge you to use cash for the next 30 days for some of your expenses. I am sure you’ll see a shift in your spending habits if you stick with it. But as always, I want to hear from you! Do you use cash or credit more? Do you think you spend more when you use your card versus cash? What is one thing that you plan to pay with cash for the next 30 days?
Holding you accountable,
DWM