Could the cash prank be your ticket to paying the bills?

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Many of us are used to shopping by swiping a credit card. And the benefit of doing so is the convenience of not having to worry about having physical cash on hand, and also getting rewarded for the purchases you make.

The problem with credit cards, however, is that they can lead to overspending. And often, these overspending is unavoidable.

These days the cost of living is skyrocketing due to inflation. And so many consumers are spending more money than ever to fuel their cars, put food on the table and cover their utility bills.

If you continue to charge these expenses to your credit cards as you always have, you may find yourself in a situation where you cannot fully pay off your balances at the end of the month. And that means committing to paying interest on a pile of debt.

If you want to avoid this fate, cash stuffing might be the way to go.

How Money Stuffing Works

There was a time when credit cards didn’t exist or weren’t as commonly used. At the time, consumers handed over cash to pay for their purchases.

Cash stuffing simply reintroduces this concept. Rather than swiping a credit card when you need to buy things, you allocate money to different expense categories in advance, then physically draw from those cash reserves to make purchases.

If you’ve ever tried the budgeting envelope system, you might already be familiar with this concept. With envelope budgeting, each expense you spend money on gets its own envelope with enough money to get you through the month. If you exceed in a given category, your only choice is to reduce in another category to make up the difference. Ultimately, you can only spend the total cash you have – you can’t overspend.

Is cash stuffing a good system for you?

With the cost of living skyrocketing, now is a good time to consider cramming cash as a way to get your spending under control without going overboard and going into debt. To use this method, you will need to take your income and break it down by expense category. Then you will use these allowances to guide your spending.

Here is an example. Let’s say it’s the end of the month and your income for the month is decreasing. Maybe you would normally hit the supermarket, buy everything you think you need for the week and load it all up on a credit card, whatever your total tab is. With cash stuffing, you’d rather see how much money is left in your grocery allowance, take that money to the store, and see what it buys you rather than doing things the other way around.

Of course, cramming the cash means giving up some of the benefits of using credit cards. But if you’re having trouble sticking to your budget in the wake of soaring inflation, it’s worth trying the cash stuffing system. It could be exactly what helps you avoid debt and maybe even save money at a time when expenses are so hard to keep track of.

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Herman C. Harkins