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Cash Amnesia

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Re: Cash Amnesia

#11

Post by von_lohengramm »

malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

This is more about hiding/perpetuating bad habits vs enabling stupid purchases. Not about impulsively buying something just because it was on sale, but rather buying something you know you shouldn't... but it's just this once, I promise! No more after just this last one...

Re: Cash Amnesia

#12

Post by tekla »

malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

Uhhh what. Credit gives you a literal list of all the dumb purchase you made.

Cash is just pieces of paper.

Re: Cash Amnesia

#13

Post by jfim »

WJW wrote: post #7
malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

I can easily see both depending on how diligently people track their spending. I have a budgeting system setup that adds a task to my daily to-do list if my bank balance differs from what is in my hledger files (ie if I have transactions in my bank account that I have not yet put into hledger). The chances of me not being aware of on-card spending is extremely low. Cash money is not tracked nearly as accurately thoug…

That sounds like a pretty interesting setup, how do you have it work with your bank accounts?

Re: Cash Amnesia

#15

Post by EGreg »

How quaint. Countries around the world are gradually phasing out cash, and forcing banks to report any transactions that add up to more than $600. They want the tax revenue and ultimate control — but they’ll claim it’s mostly to prevent “money laundering”.

This is like analyzing the details of how people use vinyl records to play music. It won’t matter in 1-2 decades.

Re: Cash Amnesia

#16

Post by rob74 »

CalRobert wrote: post #10
malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

How strange - if I use my card it stings, I know I'll see it later (and I tend to tally up monthly expenses from CC statements). Cash in my wallet feels almost like free money by comparison.

Looks like people are divided on this - I would say, when paying by card, it only stings once (if you even bother to go through the list regularly); when paying with cash, it stings twice: once when you have to fork out the actual money, and a second time when you realize you are out of cash (again) and have to get more from an ATM.

Re: Cash Amnesia

#17

Post by mingus88 »

malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

“I spent $100 on incidentals”

Vs

“I spent $100 on pizza and beer”

Cash doesn’t sit there in your ledger month after month reminding you of your weakness. Instead you have a generic line-item that doesn’t threaten your ego; it could be anything.

You will never know you spent $1200 a year on junk food and booze. It’s just some vague category you can safely manage.

Re: Cash Amnesia

#18

Post by hunter2_ »

> “Certain products are more guilt-inducing because they feel more like impulsive purchases, like a foam hand for the sports game,” Huang says. “Some are more rational purchases, such as books or stationery products for class.” Sure enough, they found that customers were more likely to pay in cash for harder-to-justify items like stuffed plush mascots and Christmas ornaments.

Or perhaps the group of people buying harder-to-justify items tend to be people who don't bother to learn the perqs of credit cards or don't have enough credit, so they'd use cash regardless of what they're purchasing, but they purchase junk, so they end up painting this author's picture either way.

Re: Cash Amnesia

#19

Post by r4indeer »

malfist wrote: post #2

This goes against everything I'm familiar with around budgeting. One of the big tricks to getting your budget in check is to pay cash so you can see the money leaving your wallet. Swiping a credit card makes that all invisible

For me, I need to have it the other way around. Regular withdrawals of similar amounts on my bank statement tell me nothing about how I spent my money a month from now.

When paying with card, I leave a paper trail for myself to review later. I can also look at my banking app anytime I want to check how much is left. I actually do that before most purchases that go beyond a few bucks.

Re: Cash Amnesia

#20

Post by mdp2021 »

hooverd wrote: post #5

Obviously you pay cash so it doesn't affect your social credit score. I always pay cash at the bar- it's an easy way to realize you're spending too much compared to just opening a tab. Plus you don't get stuck closing out if you wait too long.

"social credit score"?
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