Do you start your month with bank account full of your salary and end your month with hardly anything in your bank account? Do you feel surprised at the end of month when you realize that you have spent all your money and didn’t save enough?
I too feel the same. I go to a restaurant, eat, swipe the card and I am done. I keep the fuel tank of my car always full because it takes around 30 seconds to swipe the card, sign a receipt and go. When I go to buy grocery, I would buy the biggest packs and anything that would catch my fancy. There I would pay by food coupon and walk out with shop’s attendant carrying my shopping bags to my tow.
One day, someone returned some money to me. Now, I had the hard cash. I went to fill the fuel in my car, and instead of using card, I took out my wallet and counted the currency. Fuel costs a lot, at least counting the notes took long! I went to buy clothes for my friend for his birthday gift and counted the notes. I pulled back the temptation to buy something for me. When one day I had to pay for the grocery by cash, I thought – did I really need those extra packs?
When we pay by cash, we see the money moving out of our hand – we lose a physical object. We should not pull back essential expenses but we do pull back unnecessary expenses. Now play reverse, deposit cash in your saving instruments and you will feel that you have handed over something precious for some good. Cash can enlighten our sense that money is not plastic card that you swipe, sign and go. Card is a debt and you need to pay after the end of month. You miss on one payment and you will need to pay interest. Initially you may falter once in an year, then twice and gradually you may end up paying just the minimum amount due on your credit card every month.
Nevertheless, credit cards bring benefits – they give us discounts, privileges etc. I am not discouraging you from using credit cards but I am encouraging you to use cash at least occasionally to keep your sense of money.
Do keep your habit of paying some big transactions through cash.