Lifestyle · Personal

Finance: Cash Vs Card Challenge

If you’re over a certain age, like me, you’ll remember the time before chip and pin or contactless when you had to sign your name to make a card purchase, or even write out a cheque in certain cases! These now seem like really old fashioned ways to make a purchase and did make the process ever so slightly longer than simply tapping your card against a reader, but does the ease of contactless make us less conscious of how we spend our money?

person holding white POS machine
Image Credit

Personally I have become so used to paying for everything by card that I rarely have cash on me. My reasoning behind this has always been that if I took out £10 for a £2 purchase I’d simply spend the change, therefore I’m saving money only using what I need using my card. However, I’ve realised recently that I’ve become a little blase and not really thinking of my purchases as REAL money, just simply tapping away with my card. I also find that my teenagers often ask for an odd few pounds here and there to be transferred to them via online banking which I know for sure all add up!

I have therefore set myself the challenge of using only cash during the month of January, I have purchased a budget book – any excuse for new stationery!- and plan to record every penny I spend whilst trying to remain within my budget.

How Will The Challenge Work?

At the end of December I worked out how much I would need to keep in my bills account to cover direct debits and transferred that over from my main account. I then topped up my other online funds which include a Christmas pot and a holiday/family fun pot.

Once I’d covered all commitments I took out a set amount for groceries, petrol and school dinner money and put them into separate cash envelopes. Finally I set myself a cash budget for the month. I know everyone who operates a similar system does it differently so to clarify my budget is to cover:

  • Top up shops – i.e. milk, bread, fruit
  • Trips out/ meals/ family fun etc
  • Clothes
  • Unexpected bills
  • School trips or additional school costs
  • Treats – i.e. sweets for the kids, books for Mummy etc
  • Parking costs
  • Money for kids if needed
  • Extra curricular clubs
  • Anything else………

I will only be using cash during the month and will not be transferring money to the kids at all,

What Am I Hoping To Learn?

I’m hoping that using only cash will help me consider my purchases more carefully due to the physical act of handing over actual money as opposed to using a card. Also writing down every single purchase I make during the month I hope to be able to identify what I’m spending my money on and see what my spending priorities are.

For years I’ve always enjoyed finding bargains and searching for offers so I’m hoping these skills will help me with some creative ideas for fun on a budget with the family too.

My overall goal is to stay within budget and hopefully save what’s left, even if it’s only 20p! I’m also hoping not to use any of the remaining funds in my bank account so that these can be moved into savings at the end of the month.

four 20 Euro banknotes
Image Credit

The budget I’ve set is quite tight, but I’m confident that I can rise to the challenge and I hope that it’s something I will continue throughout the year if I’m successful. I’ve already been doing the challenge for nearly a week and so far so good. I plan to update with a future blog post at the start of February so be sure to check back and see how I fared!

Do you prefer to use cash or card when making purchases? Have you ever done the cash only challenge? Let me know below, I’d love to hear about your experiences.

6 thoughts on “Finance: Cash Vs Card Challenge

  1. Mel I think this is a brilliant idea. Like you, I use my card all the time. I watched a recent programme about the country going cash-less. Apparently in Sweden you can even have microchips implanted into your hand to swipe instead of your card. I feel that a lot of children arent fully understanding the value of money and not using cash and physically handing it over may be partly the cause.
    Good luck on this tricky challenge!


  2. I think you are so right it’s so easy to use card and not really think/forget the purchase. I’m trying to be more mindful and like you difference was I’m still using card & ‘forgetting’ purchases so will try drawing the cash out!


  3. Card is always better than cash if spending is equal due to the rewards. But you’re hoping that using cash will lower your spending for only necessities. That’s a good way to do it. Another way is to write everything down before you buy anything and have to review it 2 days later before buying it. It really makes you think if you need it or just want to splurge on something.


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