Repost and Summary:

For many of us, grabbing a credit or debit card is second nature when making purchases. But what if you set aside those cards and committed to using only cash for your day-to-day spending? GOBankingRates spoke with three individuals who did exactly that — for periods ranging from a month to an entire year — and discovered some surprising benefits (and challenges) of a cash-only lifestyle.

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Less Temptation To Spend

One of the clearest takeaways from these real-life cash-only experiments was that physical money made people pause before making a purchase. Handing over actual bills feels more personal and tangible than swiping a card, which can lead to more mindful spending.

• Why It Works: There’s a psychological effect when you physically hand over cash. Watching your wallet get lighter or counting out bills makes you acutely aware of what you’re giving up.
• The Result: Impulse purchases drop because you’re less likely to part with physical money compared to a quick card swipe.

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Better Budgeting With the Envelope System

Going cash-only can seem overwhelming at first, but the tried-and-true “envelope system” is a game-changer.

• How It Works: Assign each category of spending (like groceries, entertainment, or bills) its own envelope and fill each one with a set amount of cash for the month.
• Why It Helps: Visually tracking exactly how much remains in each envelope forces you to consider whether a purchase is truly worth it. If the envelope is empty, you have a clear sign you need to rein in spending or re-allocate funds from another category.

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No Interest Charges

Another unexpected perk of living without plastic? You’re off the hook for credit card interest fees and loan payments that can creep up.

• Why It Matters: Relying exclusively on cash means there’s no monthly interest to worry about. Over time, this can lead to significant savings and help you stay out of debt.

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Final Thoughts: Is Cash-Only Worth It?

While using only cash can be an effective way to reset your budget and reduce impulse buys, it’s not without drawbacks. Some found it inconvenient in situations where digital payments are the norm. Others mentioned missing out on credit card rewards or the simplicity of auto-pay. Still, if you’re looking for a fresh perspective on how you spend your money, going cash-only (even for a few weeks) might be a powerful wake-up call. You’ll see firsthand where your money goes — and possibly break free from spending habits you didn’t realize were draining your wallet.

Have you ever considered going cash-only? Let us know how it goes and what you learn along the way!

Original article below:

https://finance.yahoo.com/news/paid-everything-cash-months-learned-170054842.html