Sunday, January 15, 2012


Everyone has heard we are in economic downswing. Along with the downswing comes rising prices on due to the price of gas. The result is the consumer spends more, but what if the consumer can’t spend more, then use cash.

Studies show even when using a debit card a person will tip more, and buy more. If you’re out for lunch and you have ten dollars. You buy something under ten, so you have money for a tip or you might do the fast food option. If you are doing the cash only option, you might also decide it is infinitely cheaper to brown bag it. The person who dines on their debit or charge card eats more by ordering drinks, appetizers, and possibly desert. They go for the higher price entrees. The helpful waiter or waitress gets a much larger tip too. Cash not only saved you money, but a ton of unneeded calories too.

Back when you drew up a budget and decided how much money you needed for groceries, put that money in an envelope. That’s all you can use for groceries. You don’t impulse shop and pick up various edibles because you might like them. In America, we throw out 25-40% of our food stock because it simply grows old in our fridge and cupboard. Limiting the amount you spend at the grocery and using cash only will make a huge improvement in your cash flow. You will have to use all those canned goods you bought over a year ago and the frozen turkey in the bottom of your freezer. Start dating your food.

Grocery stores rotate food so the oldest is in front for sale. Do the same at home only use a permanent marker to mark the date it was purchased. Always label items you repackage and freeze, so it has a chance of being used before freezer burn sets in. Use your produce, slightly wilted veggies work fine in stews and soups. Wrinkly apples can be turned in to applesauce. Less than firm fruit makes an excellent smoothie. Stale bread can be freshened up in the microwave wrapped in a damp paper towel or it can be toasted. Remember as a cash only person you do not have money to burn.

When shopping tell store owners and sales associates that you are using cash only and could they lower the price of the television to three hundred since that is all you have. If you are in the price ballpark, they will lower the price because they want to make a sale. By mentioning or even showing you have cash it means you are a serious customer. Many people now dicker in the current economy, so you won’t be the first.

Cash tends to be more real that’s why a salesperson is more reactive when he sees it. We as the consumer react more to cash too as it passes through our hands. A hundred dollars seems like too much for a pair of shoes when we pay in cash, but we never even blinked when it went on the store credit card. You’ll find when using cash only your habits change.

The five dollar magazine isn’t needed to pass time, neither is the specialty coffee. Instead, you hold onto your last ten for something you really might need such as a couple gallons of gas to get you home. The best thing about using cash, besides spending less, is you’ll have no interest charges, or late fees. It is a good habit that many Americans warmed up to over the Christmas holiday. Now, they don’t have to deal with the after holiday bills coming due. Of course, January is always a good time to start a Christmas Savings account.