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Original poster

Does anyone else take out cash to help manage money?

45 replies

Proudtocare3562 · 02/05/2022 21:37

This is the only thing that's worked for us and thought id share as it really helps to budget in my opinion. Every week we take out the money in cash for food and petrol. Seeing the money in your hand and how much is left I find really helps me budget. Its too easy to zap your card here and there and not keep tabs. The only thing is we can't do online doing this but have been going to lidls and its working well.

I also pay termly for my children's clubs but i am taking out the monthly amount in cash and putting it in envelopes so when it's time to pay again i have the money ready instead of a huge bill which I haven't budgeted for.

Are we the only ones that are old school and do this? I always remember my mum having tins for different things when we were younger.

OP posts:

BarbaraofSeville · 04/05/2022 04:09

CraftyGin · 03/05/2022 21:48

This is a tactic used by debt management organisations, such as Christians Against Poverty.

The idea is that you only spend what you have.

It must have been difficult during the cashless lockdown.

An alternative that would work without cash would be to move the money to a separate account and spend from that. I don't know about Monzo, but with Starling, if you don't have an approved overdraft you can only spend what's in the account and all transactions register instantly, even small contactless ones, so you can send £x per week/month from your main account and use that for food/groceries and/or personal spending so can only spend what's in the account and check easily in the app what you have left.

It will also tell you what you spend in different categories so can be more useful than cash if you are prone to withdrawing £20 only to find it disappears and you have no idea what it went on.

Another advantage is that it separates your day to day spending money from your direct debits so you're not looking at an account full of money and trying to work out how much is available to spend and how much needs to be left in for direct debits coming out before payday, you can just forget about what's going on in your bills account.

Libertybear80 · 04/05/2022 05:02

I couldn't be hassled with that. I just check my bank account online regularly.

NoWordForFluffy · 04/05/2022 06:18

LuluBlakey1 · 03/05/2022 23:30

MIL has a friend who when she and her DH get their pensions, takes it out of the bank and puts it in separate envelopes- electricity, gas, council tax, food , water, petrol, contingency etc so she knows she has covered everything. She then knows what she has to spend, puts it in her purse and sticks to it. Her husband is given £10 a week pocket money for himself.

Most of those are paid by direct debit here. Cash wouldn't work.

I also couldn't be arsed with it; my spreadsheet works just fine.

Billybagpuss · 04/05/2022 06:28

It does worry me that many places are now going cash free, this method has always worked for us too.

FusionChefGeoff · 04/05/2022 07:07

I'm finding that using the budgeting app YNAB has the same effect. At the beginning of the month, I assign every penny that we know is coming in, to loads of different pots (all bills, annual insurances, kids clubs, birthdays, Xmas, tax etc). It shows you how quickly a seemingly large amount of money will disappear!!

Then it's linked to my account so before every transaction I can check my pots to make sure there's enough and all DDs are automatically matched against their allocated pot when they go out.

If you overspend in one category it prompts you to take it from another category to stay on track overall but give flexibility.

I absolutely love it!!

AuntieStella · 04/05/2022 07:36

I don't at the moment, but think it's a very sensible approach.

It does reduce impulse buying, and frittering of small sums.

Ans with interest rates set to rise considerably, it makes great sense to reduce balances on cards now, especially if you might not be able to pay in full every month

RancidOldHag · 04/05/2022 07:38

Billybagpuss · 04/05/2022 06:28

It does worry me that many places are now going cash free, this method has always worked for us too.

If you want cash (and cheques) to continue to exist, then you have to use them! Ditto bank counters.

Mindymomo · 04/05/2022 08:02

It’s just too easy tapping away. I use a credit card, couldn’t believe my bill this month was over £700. There is about 20 items, largest being £65. There’s no way I would have spent that much if I had cash on me. We still pay cash for takeaways and restaurants and most places I shop still take cash and tills at supermarkets I go to the ones that also take cash. We don’t have any banks here anymore so any change I have I use in these machines. I have a large tin of coins from over 2 years ago when my FIL died, so I’m slowly getting rid of this.

ReadyToMoveIt · 04/05/2022 08:06

NoWordForFluffy · 02/05/2022 21:46

No, I don't want to use cash. I just budget with a spreadsheet so know exactly what I have left at any given time.

Same. I don’t want pots of cash lying around, and most of my kids activities (swimming, music lessons etc) have to be paid online.
I use a spreadsheet with all incomings and outgoings, very easy to keep track that way.

ReadyToMoveIt · 04/05/2022 08:08

WorkCleanRepeat · 03/05/2022 22:35

I find the opposite. My brain doesn't register cash as real money. Once it leaves my account in my mind its spent/gone. I'm far more frivolous with cash than card.

Same here.

NoWordForFluffy · 04/05/2022 08:55

ReadyToMoveIt · 04/05/2022 08:06

Show quote history

My spreadsheet is on my phone. Thereabouts as soon as I leave a shop I log the purchase and update my budget.

I have set outgoings (bills, savings (four pots), debt payments, kids' swimming etc), then the rest is there to spend as I see fit. I don't have a weekly food budget, for instance, I buy what's needed within budget (i.e. whatever money is left).

I'm presently paying off debt, so a large chunk is that, but it'll ease come next March once my student loan (mortgage-style, pre-98) is paid off.

FinallyHere · 04/05/2022 13:02

Like @WorkCleanRepeat I much prefer to pay on line so I have a record of what I have spent. When I go out with cash, I come home with out any and I have little recollection of what I spent it on.

Online doesn't need change and provides that record. Remembering to not buy things I suppose just has to come from my head.

FinallyHere · 04/05/2022 13:03

Oh and I have been known to just loose cash, too

ReadyToMoveIt · 04/05/2022 13:04

Online doesn't need change and provides that record. Remembering to not buy things I suppose just has to come from my head

Exactly. I manage to not buy things by just deciding not to buy it, because im trying to save money.

NoWordForFluffy · 04/05/2022 14:04

ReadyToMoveIt · 04/05/2022 13:04

Online doesn't need change and provides that record. Remembering to not buy things I suppose just has to come from my head

Exactly. I manage to not buy things by just deciding not to buy it, because im trying to save money.

Exactly!

BarbaraofSeville · 04/05/2022 14:34

ReadyToMoveIt · 04/05/2022 13:04

Online doesn't need change and provides that record. Remembering to not buy things I suppose just has to come from my head

Exactly. I manage to not buy things by just deciding not to buy it, because im trying to save money.

Same here. You're still spending money however you pay for it. The cash/credit/debit card is just a payment tool.

Deciding whether (or not) to buy something is a separate thought process. How the thing is being paid for doesn't affect whether or not you buy it.

tuliplover · 04/05/2022 14:40

I did this back in the day. But I don't use cash now. So many places don't accept it. Plus I hate carrying a purse or bag - I keep my debit card in my phone case.
But what I do do is have multiple accounts for different things. I have one for day to day and bills, another for the kid stuff like school trips and other school related stuff, another that I get my income paid into, a reserve account and so on. I then put a certain amount in the day to day account. Then if that gets low I can instantly see online what I've spent and what's pending.

FusionChefGeoff · 04/05/2022 23:18

Ah yes but 'deciding not to buy something' isn't that simple it's a complex process influenced by loads of tiny conscious and unconscious thoughts.

For some people, a physical sign of money available ie a pile of cash that gets smaller - reinforces the idea that the money is about to run out and helps them to decide not to buy something.

If you've been paid £2k it's easy to think the £3 coffee won't make a dent so you buy it without thinking.

But if you've only got £20 in your 'eating out' cash envelope it's a much more concrete and significant decision to remove £3 and spend it.

AlmostAJillSandwich · 05/05/2022 02:20

I'd be too scared of losing it, i'm paranoid about notes sticking together etc or dropping them.

ReadyToMoveIt · 05/05/2022 07:53

FusionChefGeoff · 04/05/2022 23:18

Ah yes but 'deciding not to buy something' isn't that simple it's a complex process influenced by loads of tiny conscious and unconscious thoughts.

For some people, a physical sign of money available ie a pile of cash that gets smaller - reinforces the idea that the money is about to run out and helps them to decide not to buy something.

If you've been paid £2k it's easy to think the £3 coffee won't make a dent so you buy it without thinking.

But if you've only got £20 in your 'eating out' cash envelope it's a much more concrete and significant decision to remove £3 and spend it.

yeah and I have the same system… just online rather than with paper money.
I know when I’ve been paid how much is allocated to bills, food etc. I know roughly how much is available for ‘frivolous’ stuff… I can see in my online banking.

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