I’m a spender. There. I said it. I’m not one of those people who can walk through Walmart or Target and only buy what’s on my list. There are just so many cool things in those stores that I want for myself or my kids or my grandkids. Don’t get me wrong – I’m not spending big bucks. My impulsive purchases usually add up to $5 or $10 or even $20. But unfortunately, those amounts are enough to blow the budget. It’s amazing how fast they add up!
So in an effort to stay on budget, I decided I would only use cash. For about four weeks I diligently went to the bank once a week and pulled out cash for all my weekly spending except gasoline. Gasoline takes a lot more work if you use cash so I stuck with the debit card for that. But you know what? I HATE using cash. I HATE it.
Yes, cash works. Yes, I stayed on budget (mostly). Yes, you can’t spend more than you have. Yes. Yes. Yes. But I still hate it. I don’t want to use cash. So I drifted back to using my debit card and making those impulsive purchases that blow the budget.
Plan A didn’t work. Well, maybe I should say that I didn’t like Plan A and I stopped doing it. So I’m going to try Plan B instead. If it doesn’t work, I’ll go back to Plan A and make it work. I can – I just don’t want to.
So Plan B. We currently have two checking accounts. The first is a business account (husband is a self-employed remodeling contractor). The second is for our bills and spending. Plan B creates a third checking account for spending only. How will that help, you ask? Currently, when I use my debit card and spend from the bills account, even though I have a set amount to spend, I’m not as careful as I should be because I know there’s extra in there. If I overspend a little, it’s not a big deal. There’s money to cover it and I’ll figure it out later.
The new spending account will have a limited amount of money. Every week I’ll transfer my spending allowance to the new account and spend from there using the debit card. There won’t be extra to cover those impulsive purchases. It’s like cash – a limited amount. When it’s gone, it’s gone. And if I overspend, I’ll overdraw and that’s not good.
I opened the new account on Saturday. Once the debit card and checks arrive, I’ll give it a go. And in about a month, I’ll let you know if it’s working. I sure hope it does, because if it doesn’t, it’s back to cash for me and you know by now how I feel about cash.
Do you use cash or a debit card? What are your tricks for staying on budget?