So this year we are really focusing on paying off debt and saving more! And one way we have seen results is using cash more! So last month, we decided to an all-cash spending challenge in our family! The first week it really took some getting use to not swiping our debit card. There were 2 areas we could use our debit card (gas and Instacart which is linked to my husband’s debit card). My husband has been buying gas for me, so I didn’t really have to swipe last month. I just really hate going inside the gas station, so we were fine swiping the debit card at the gas station! So here is our recap:

Using Cash Envelopes: So because this is the first time in years that we are using cash only, I decided to not take out all the cash for the month all at once each paycheck. So I have a budget in our Debt Crushing Mama Workbook and in Every Dollar app. I look at each category daily. As I need to go to the store, I go to the atm and take out what I need for that day. I try to shop only needs (which means I go to the store more frequently 1-2 times a week), and I only get what we need for 3-4 days at a time. I try to focus on a No Food Waste mentality. Before we were buying all this food and not using it. On average, people waste about $2000 worth of food per year. So shopping 1-2 times a week helps us to really focus on what we are eating and not waste food. We eat exactly what we buy. We will talk about stocking up during sales during another post. BUT! I only take out what I need for that day. Now, some people use cash envelopes and take out cash for the month or for that pay period. I do not like to take tons of cash out at one time. SO for us, we put money in a grocery envelope, miscellaneous, and toiletry envelope. And if we go grab food from a restaurant to go, we go to the ATM. For us, going to the ATM is an inconvenience, SO it forces us to spend less money! So we make it NOT appealing, and by doing that, it forces us to spend less than we normally would spend in each category! So that worked for us last month! HAVE A PLAN!

2. Create a budget that works for you! For us, we had to tweak and play with our budget for months to find out what we should spend in each category! So for now, we spend $600 on groceries or $150 per week for a family of 6. We spend $100 on pet supplies each month. Around $100 for Toiletry items. Rachel Cruz says it takes about 3 months in order to develop a budget that works for you! So keep playing with your categories, and then when you have your categories, take out what you need for that week, pay period, or you can do what we do and only take out what you need for that category for that day!

3. Evaluate your budget categories and financial goals: for us, we really wanted to focus on our debt pay off and savings goals. So using cash has really helped us pay off debt faster! We are saving in every category not only because of the Coronavirus, but also because we are evaluating and looking at our budget categories daily/weekly/monthly and seeing if our spending is lining up with our financial goals!

4. Bring your kids and family in on the journey! One of the biggest and most rewarding advantages of using cash has been showing our kids the importance of using cash and saving! Our kids are seeing firsthand what paying off debt looks like. They are seeing first hand how much things cost and focusing more on saving. It has been super eye opening for them, and it helps me to see that what we are doing is making an impact for generations to come! Teaching our children to be wise with money and use cash not credit is a lesson that so many are missing! I missed that growing up, so I’m so thankful I’m able to teach my kids about financial literacy!

5.Cash Flow your Vacation or Goals using Cash :So we took our first mini vacation during our 31 day challenge. We used cash the entire trip to the beach (outside of paying for the hotel on my card, then paying it off immediately). I simply took the money we budgeted for the hotel, put it in the bank, and paid off the card immediately. Using cash helps you to save towards your goals. So use envelopes to put money aside each paycheck, and cash flow your vacation or financial goals. What do you want to save for? Use cash, spend less, and start putting money aside every single paycheck!

Drawbacks of Using Cash:

Although it was much harder to take money out of the ATM every time I needed it, it really forced me to evaluate if the item was really a need or a want!
Also, it was much harder to track cash spending on the budget than swiping a debit card, so I will have to track on my Debt Crushing Mama Workbook that day or store receipts in a safe place until I’m able to track this month. Tracking is much harder for me using cash than debit card especially since our Every Dollar app is linked to our debit card. So that is going to take more work and practice this month.
Making it difficult to spend money by NOT having cash readily available forced me to be uncomfortable and challenged me to spend less.
Although I may tweak a few things this month for our continued all cash challenge, I am overall happy with our results. We paid off $933.88 in debt in March, saved in every single category, and even took our very first all cash mini vacation. Although difficult, I would recommend trying an All-Cash Challenge. It’s a great family challenge and forces you to budget and spend well. Your financial goals are possible, and guess what friend! It starts today!

Until next time friend,

Shelly