Debit Card Or Cash?

A recent news report claims the debit card may soon completely replace cash. Debit cards certainly make shopping easier for us. No need to write out a check, or for those pesky trips to the bank. It has created a different problem, though. A debit card makes shopping almost too easy. The card can be easily swiped, whether or not you're sure you've already taken care of your other bills.

Here’s a suggestion to help you keep within your budget. And it doesn't involve complicated spreadsheets or tedious documentation.

First, check your budget. Make sure that you've included expenditures that vary, like groceries and entertainment. Then identify the average amount money you have left over each week after your budget has been covered. 

This discretionary money—your allowance—is what’s left over for you to use for extras and impulse buys. Withdraw this amount from your account each week, and put this cash in your wallet.


The only rule: use your debit card, if you like, for anything that’s within your budget. ALL other expenditures come out of your cash allowance.


When the cash in your wallet is gone, you’re done for the week. That’s it. Simple, but not necessarily easy.


There may be only one rule, but to be effective, you have to make it an unbreakable rule.


This will take self-discipline. But if you’ve read this far, doing a better job of controlling your spending is important to you. You owe it to yourself to give it a fair chance to work.

Try withdrawing your allowance before the weekend, since that’s when we tend to spend the most money. When you want to buy something outside of your budget, check your wallet. If there's enough cash to cover it, you're in good shape.

If you open your wallet and find it’s nearly empty, you know that something has to give somewhere. Either don't buy it or adjust something non-essential from your budget to cover the purchase.

You're the judge of whether changing your budget is a good idea. Now, if you do adjust, your are doing it knowingly, instead of by chance.


Bonus idea: Challenge yourself to have money left over at the end of the week. Set this aside for a rainy day, or even your next splurge!