Hello,
Here is a quickie for all of you wanting to cut down on your spending. Go to cash.
By go to cash, we mean use cash for your daily transactions. Why? Well, the reason is we often treat cash differently than plastic money. Think about it, its one thing to hand someone a plastic card, its another to give them a dollar bill. We aren’t experts, but there are probably a couple of reasons for this difference.
First, if you use plastic, you are less restricted in the amount you can spend. For example, your credit card may have $500 dollars left on it. But, if you use cash, you are limited to the amount you’ve got on hand, usually like $50 to $100 bucks.
Miel thinks it has a lot to do with the finiteness of cash. She has traveled a great deal with cash in her international voyages and thinks that one is more apt to want to preserve it for security reasons. Additionally, if you don’t have alternatives you will be more careful when choosing your purchases. For example, if you walk into the grocery store with a hundred dollar bill, rather than a credit or debit card, we’d wager that you’ll be a bit more conscious of your spending if you know you’ll have to put items back at the check stand. It will also motivate you to find items you can save money on.
Second, cash has symbolic value that plastic currency doesn’t. For example, when you use a dollar bill, you view the dollar as being more valuable because of its symbolic nature. It looks and feels like money, its got nice etchings, a thick feel, a pleasing color – a picture of a dead president, etc. etc. In contrast, the credit card is just a hunk of plastic. Your mind reacts accordingly.
So, to help cut down on your spending, you might consider leaving your plastic at home and carrying cash. This will help you save money on many purchases and in turn free up cash to build wealth with.
Best,
Miel & James
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