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The day of reckoning is here. I sorted through my receipts and tallied my discretionary expenditures during my month-long cash-only experiment. The tally below does not include fixed bills like rent. (New to my forward-thinking budgeting system? It takes 15 minutes to set up.)
Overall, more than a third of my discretionary spending – 35 percent – is unaccounted for because I forgot to ask for a receipt. That means a picture of my spending provided below is woefully incomplete. This is also why some of my category totals, like meals out, seem low.
A number of seemingly random items sucked up my dollars – like bike repairs and gear in preparation for a triathlon May 1. I say seemingly random because unusual expenses like these pop up every month without fail. This is the main reason I created a forward-thinking budgeting system.
My totals for each spending category include tax.
Groceries: $172.22
Meals out, including coffee: $21.12
Drugstore items: $43.10
Bicycling gear and repairs: $169.38, including $100 to ship bike across the country and back
Business supplies: $15.86
Ski trip: $95
House and garden: $45.52
Gas:$41.57
Camping: $40
TOTAL accounted for spending for April: $643.77
TOTAL ATM withdrawals: $1,000
Cash left in my pocket: $11 (to last me until Saturday)
Total unaccounted spending: $345.23
Total rebates and gift cards earned: $29.69
Percent of spending unaccounted for: 35 percent!
My month-long cash-only experiment has taught me a lot about money. I dipped into savings only once, and that was to cover a $533 emergency mattress purchase. I’m telling you it really was an emergency! Grocery shopping takes longer because, with a finite supply of cash in my pocket, I add up the cost of each item I put into my cart so that I have enough money at check out.
Welcome to Bargain Babe! I’m Mara, and I’m so glad you’re here. I am an obsessive bargain hunter and penny pincher, and I am determined to live a full life without EVER paying full price.
So what did you learn from this that you can give to us? Should we quit using cards? Did you actually save money? What can you sum up from this experience?
Just another possible way to handle the mattress thing..
With expenses like that, I typically consider it as part of my monthly budget, but with an allowance in my head that I can reimburse myself if I can’t cover it within my normal budget. This stops me from being overly restrictive of my budget because of the unexpected expense, but still encourages me to be careful with my money for the rest of the month.
So at the end of the month, you had $345 surplus, OR a $188 deficit if you counted the mattress. I would have taken only the $188 out of savings to balance my monthly budget while minimizing the impact on my savings.
However, this approach is more difficult with a cash-only system.. but fwiw.. 😀
Seems to me to be an awful lot of unaccounted for spending. Perhaps you shouldn’t have carried all that cash around with you all the time.
Don’t beat yourself up over the lack of receipts. It takes time to get into the habit of living a cash-only life, and I still slip up now and then. I know you’re not ready to try this again right now, but maybe one day soon you will. At least you know what you need to do to improve, and no one had to tell you that. Good try all ’round!
Sounds like it was a worthwhile experiment. I understand that using credit cards all the time can tempt someone to spend beyond their means, because “it’s not real money”. I don’t use credit cards for regular expenses anymore (rewards be damned), but I use debit cards whenever I can. I like the fact that it creates a paper trail (In case I *don’t* get a receipt), and the fact that both my wife and I look over the bank statements means it eliminates the temptation to “hide purchases”, whereas with cash it’s easier to randomly drop by Starbucks and have that $2 or $3 go unnoticed, if all you see on the statement is a $20 ATM withdrawal.
One place I’d take objection to your experiment is that the money spent on your mattress is actually real cash spent, it just came from income from a past pay period rather than the current one. It should have counted toward your budget, and in actuality you spent $1533, not $1000. It’s that sort of magical thinking about money that gets people into trouble, rationalizing a purchase by saying it was an “emergency”, and not counting it toward your current budget because it came out of savings.
Even if you literally could not sleep on your old mattress and felt you *had* to get a new one, the purchase still counts! Rather than fudging the numbers to make yourself feel you met your goal, it’s better to just recognize you blew your budget (you did, BTW) and take steps to prevent it in the future.