For Christmas, my 4-year-old daughter picked out a new wallet for my gift. It’s exactly the kind of wallet a 4-year-old girl would choose: bright pink and covered in swirly hearts. A silver heart pendant hangs from the front clasp.
Even though I’ve only been using the wallet since late December, I realized soon into a month-long plastic fast how my spending habits had conditioned the way I use it.
Each time I went to make a purchase, I automatically unsnapped and flipped open the wallet to the now-empty credit card slots. It took a few weeks before I’d trained myself to unzip the wallet’s cash compartment first.
I joked I was having swipe withdrawals.
Last month, I wrote about how credit cards, when used responsibly, are useful financial tools. But they do have downfalls. Mainly, people tend to spend more when using credit versus cash.
I wanted to see if I could operate without my cards, a social experiment as well as test of financial willpower.
Now at the end of my self-imposed challenge, I’m ready to unsnap and swipe again.
That said, there were benefits to my plastic furlough.
First, I found I could operate fairly well on cash. Clerk s didn’t bat an eye as I counted out my bills. I saved 3 cents a gallon on gas by paying cash. I was also far more aware of my purchases, and forced to make some either/or choices. This, I think, is the true benefit of cutting out the cards.
I did cheat once on Giving Hearts Day, an online fundraising effort. I gave my husband one of my twenties and had him make donations with his credit card on my behalf.
While my month-long challenge wasn’t meant to be an exercise of self-deprivation, my low-balled weekly allowance of $140 made it feel like one. I bought groceries and gas, paid babysitters and dined out twice with that money, and that’s about it. I didn’t bother going to department or big-box stores. Good thing I was stocked up on diapers.
Still, I only spent about $482 for the four weeks, staying under budget three of the four. In Week Two, I went off-list at the grocery store and needed to write a check, too embarrassed and stubborn to put any items back. I deducted my overage of $28 from the next week’s budget.
Without a card, I had to pass on several online daily deals that could have saved me 50 percent at those vendors. Of course, not buying them in the first place saved me 100 percent.
During the four weeks, the only activity on my credit card was one automatic payment to our Internet provider, a rewards credit and two payments, paying off the January bill and smaller February statement.
It is liberating to know I don’t owe Visa any money. And this past month I did spend less because I couldn’t spend more.
But cash also cost me. To pay bills, I needed to mail a check instead of paying them online, adding the cost of a stamp and check blank. I also sacrificed the 2 percent cash back rewards my card offers.
For purchases in which the dollar amount wouldn’t change based on my choices, it doesn’t make sense to use cash, only because I do pay off my balance in full each month.
Even on that discounted tank of gas, my rewards credit card would earn 7 cents per $3.50 gallon.
I also learned how important it is to write every expense down when working with cash. An envelope system would have helped me a lot.
So would have tucking all my receipts into my pretty pink wallet.
Sherri Richards is a thrifty mom of two and reporter for The Forum. Read weekly updates from her plastic fast at http://topmom.areavoices.com