Some absolutely love their credit cards and do almost all of their spending on them.
I am one of those people.
However, I know that credit is not for everyone and that there are many out there who understand the importance of a cash budget.
A cash budget is when you pay for the majority of your purchases in cash. Of course, there are certain expenses that you may not be able to do that for or that you may not want to do that for, such as with a mortgage payment. For the most part, though, any and almost all spending is done with cash when a person is taking part in a cash diet.
You can read more about how the cash budget method works in the article Dave Ramsey's Envelope System. There are also cash envelopes and wallets that may make it a little bit easier for you.
While only the tiniest bit of work has to be done to prepare a cash budget each month, big benefits can usually be seen.
There are many reasons for why you may want to take part in an all cash budget as well. Even if you only do it for a month or two, I’m sure you will learn a lot about your spending behaviors that can help you well into the future.
Continue reading below to read more about the importance of a cash budget. [Read more…]