It has recently been proven that people value things more when they pay for them in cash. Apparently it’s harder to say goodbye to the greens than it is to swipe a credit card. And that is why the “cash diet” deals strictly with hard money. Personal finance expert and author of “Broke Millennial,” Erin Lowry, gives three tips to people trying to save money by way of the cash diet. There include:
1. Determine your cash flow. Once you’ve paid all your major bills for the month, take the rest out in cash. Once the money is gone, it’s gone. You can however, roll over any unspent money to next month’s savings.
2. Use the envelope method to help track where your money is going. Categorize envelopes based on areas of spending and fund each one with the appropriate amount as soon as you receive your paycheck.
3. Leave a buffer. In the event of overspending or any unforeseen circumstances, leave about $100 or whatever you can afford in your bank account each month.
Like any other diet, the cash diet requires a lot of discipline, but strict adherence means money-saving results.
