What Is Cash Stuffing? Changing This Viral Gen Z TikTok Money Trend

This story is part of So Moneyonline community dedicated to financial empowerment and advice, led by CNET Editor at large and become Money podcast host Farnoosh Torabi.

Top-up cash is one of the latest money trends to dominate TikTok — and it’s a money tip that can help you pay off debt and ditch mindless online shopping.

A recent study found that “stuffed cash,” where you put physical dollar bills in envelopes, binders, liquor bottles or whatever container you choose, is especially popular with Gen Zers and millennials today. Stashing dollar bills in creative places viral on TikTok during spring. Research at Credello, a personal finance platform, found that more than half of young adults regularly use cash to manage money, build savings and pay off debt.

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And I can’t get enough.

As a personal finance expert and parent, I know firsthand how using money can encourage more financial discipline than credit. I practiced this technique in early adulthood and only spent what I had in my wallet. Because cash has a real, physical limit, I don’t overspend as much. It helped me wipe out thousands of dollars in credit card debt in a matter of years.

A 2021 MIT study found that parting with cash at the register versus tapping your credit card elicits a high degree of “pain”. That’s actually a good thing. While credit cards have an intangible, “deal later” quality to them, when we use the almighty dollar, we only pay what we can afford, which can increase our chances. stick to the budget.

But in our hyper-online world where digital payments are the norm, and almost half of consumers using mobile wallets like Apple Pay and Venmo for transactions, what goes into successfully implementing a cash-only strategy? Is it feasible?

A So Money podcast subscriber and newsletter subscriber, Ricky, recently asked: I’m having trouble sticking to the budget and I want to start filling in cash… How do I implement an all-cash budget if I have a credit card balance that I have to pay off?

I’ve got some best practices (and pitfalls) for Ricky and anyone else who wants to “make money” to save.

1. Make a realistic strategy

While some extreme cashiers may try to pay everything with dollar bills, this isn’t feasible for most of us, considering how many merchants and services prefer — or even require — digital payments.

Cash is the best way for variable month-to-month expenses, such as food, gas or household supplies, where you can exercise better control of personal spending.

Once you know what bills and payments you will use your money for, set a plan. Understanding why and how money can enable you to achieve your goals save more money or spending more consciously is an important first step to set yourself up for success.

For example, if your hope is to save a certain amount each month, that means putting a certain amount of cash each time you get paid in a self-labeled envelope (and placing the envelope out of sight).

Or if you want to leverage cash to get better cash, you can spend a limited amount of cash each month on essentials like fuel and fuel and then use the rest to pay off a piece of debt each month.

In Ricky’s case, you can technically be on a cash-only budget pay off credit card debt. You can pay your credit card balance each month at the issuer’s physical branch or ATM, or pay virtually from a checking or savings account.

2. Figure out how much cash you need every month

Although this requires some tracking, knowing how much cash you need on hand is essential. I recommend reviewing past bank statements to see how much you tend to spend in each variable category, such as groceries, gas, utilities, clothing and entertainment. From there, commit to a spending limit or savings goal and allocate that amount to the appropriate envelope.

Note that unlike variable expenses, many fixed monthly expenses, such as rent or mortgage, credit card balances, loans or even a Netflix account, often require some form of online payment.

Pro tip: Keep 10% of each paycheck in a “savings” envelope to make sure you always finish the month with extra.

3. Ditch your credit card

One big reason people choose to use cash is to rely less on credit cards to pay expenses. And as the Federal Reserve keep raising interest rates to try to clamp down on inflation, it is a good idea to destroy the debt balance as fast as possible.

While cash stuffing can limit the temptation of overspending in physical stores, it won’t prevent you from overspending online. So if you find yourself having to pay for things digitally that would normally come out of your cash-filled system, be sure to revisit your plan and reconcile the charges.

Also, consider removing the credit card number stored in your phone or on the website, which makes it too easy to buy on a whim. Having to enter your card information before making a purchase takes extra time and effort that can help reduce the temptation to overspend.

4. Expect to spend more time shopping

When I think about how the budget will only affect my daily routine, it feels uncomfortable on some level. First, I imagined going to the ATM to withdraw money. Then, if the cash strategy is for spending, I think about showing up to the grocery store in person, which requires more time than ordering groceries online and paying by credit card.

A cash-only system means less travel and a move away from the instant purchase model many of us are accustomed to during the pandemic. And that’s not a bad thing – it’s just a plan.

5. Hold the receipt

Having a paper trail of your cash purchases is important, especially for big-ticket items that you may want to return or just have as proof of purchase. Cash transactions are not tracked online like credit purchases. Always get a receipt printed, emailed or texted to you after purchase.

6. Know the trade-off you are making

Paying cash can help you reduce your overspending and build savings while taking down less of your debt. But you also give up some benefits.

For example, if you use a credit card and pay off the balance in full each month, you may earn points or rewards that you wouldn’t get when paying cash. You also don’t earn interest on your savings. And if you blame your money, there’s no way to get it back.

Some credit cards also offer purchase protection, which allows you to receive a refund or reimbursement if the item you bought is stolen or accidentally damaged. Unless you’re buying collateral, buying in cash won’t give you the same peace of mind.

Lastly, deciding not to use a credit card in any form can prevent you from building strong credit scorewhich is crucial if you are looking to buy a house, lease a car or even move to a new apartment.

For more money tips, check out TikTok money tips you should avoid. Find ways to save more money and some Our favorite savings challengeand learn what to do if you unable to pay your credit card this month.

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