Cash Stuffing: Why This Viral Gen Z Trend Is Gaining Popularity

This story is part of So Moneyis an online community dedicated to financial empowerment and advice, led by CNET Editor at Large and So Money podcast host Farnoosh Torabi.

Have you heard about the “cash stuffing” trend that is changing TikTok?

A recent study found “cash stuffing,” where you stuff dollar bills into envelopes, binders, liquor bottles or anything else, has increased in popularity among Gen Zers. and millennials. The act of keeping dollar bills in creative places went viral on TikTok during the spring. Researchers at Credello, a personal finance platform, found that more than half of young adults regularly use cash stuffing to manage their money, build savings and pay off debt.

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And it warms my heart.

As a personal finance expert and a 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 carried in my wallet. Because money has real, physical limits, I don’t overspend. It helped me eliminate thousands of dollars in credit card debt within a year.

A 2021 MIT study found that separating money at the register compared to tapping your credit card produced a higher level of “pain.” That is actually a good thing. While credit cards have an intangible, “deal with it later” quality to them, when we’re using the almighty dollar, we’re only paying for what we can afford, which improves our chances of stick to a budget.

But in our hyper-online world where digital payments are the norm, and nearly half of consumers use mobile wallets like Apple Pay and Venmo to transact, what is involved in successfully implementing a strategy cash-only? Can it be done?

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

I have some best practices (and pitfalls) for Ricky and anyone else who is looking at “money stuff” in their savings approach.

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1. Create a realistic strategy

While some serious money dealers may try to pay everything with dollar bills, it’s not possible for most of us, considering how much merchants and services want — or even need — those. digital payments.

Cash-stuffing is best for variable monthly expenses, such as food, gas or household items, where you can exercise better control over personal spending.

Once you know what fees and charges you will use your money for, make a plan. Understanding why and how cash flow can help you achieve your goals save more money or spending more consciously is an important first step in setting yourself up for success.

For example, if your hope is to save a certain amount each month, that might mean setting aside that amount of cash each time you get paid in a self-addressed, stamped envelope (and keeping that envelope out of sight).

Or if you want to use cash stuffing to better manage spending, you can set aside a limited amount of money each month for essentials like groceries and gas and then use the rest to pay off a chunk. in debt every month.

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

2. Calculate how much money you need every month

While this requires some tracking, knowing how much cash you need on hand is important. I recommend reviewing past bank statements to see how much you 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 corresponding envelope.

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Note that unlike variable expenses, many fixed monthly expenses, such as rent or mortgage, credit card balances, loans or even a Netflix account, usually require some kind of to pay online.

Pro tip: Keep 10% of each paycheck in a “savings” envelope to ensure you always end the month with more.

3. Get out of debt

A big reason people choose to use cash is to rely less on credit cards to pay expenses. And as the Federal Reserve continues to raise interest to try to control inflation, it’s a good idea knocking down outstanding loan balances sooner rather than later.

While top-up cash can limit the temptation to overspend in physical stores, it won’t stop you from overspending online. So if you find yourself having to pay for something digital that usually comes out of your cash-fill system, be sure to re-evaluate your plan and reconcile the cost.

Also, consider deleting saved credit card numbers on your phone or on websites, which makes it easier to make purchases on a whim. Entering your card information before making a purchase requires more time and effort which helps reduce the temptation to spend.

4. Plan to spend more time shopping

When I think about how a cash-only budget affects my daily routine, it feels inconvenient on so many levels. First, I imagined going to the ATM to withdraw money. Then, if the money strategy is for spending, I think about showing a grocery store in person, which takes more time than ordering groceries online and paying by credit card.

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A cash-only system means making more trips and moving away from the instant purchase model that many of us are used to during the pandemic. And that’s not a bad thing – it’s something to plan for.

5. Keep your receipts

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

6. Know that you are making a trade-off

Cash payments can help you curb your overspending and create savings while taking a significant bite out of your debt. But you also give up some benefits.

For example, if you use a credit card and pay the balance in full each month, you may earn points or rewards that you wouldn’t earn if you paid with cash. You also earn no interest on your savings. And if you don’t put your money in, 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 purchased is stolen or accidentally damaged. Unless you buy a warranty, buying cash won’t give you the same peace of mind.

Finally, deciding not to use credit cards in any form can prevent you from making a strong credit scorewhich is important if you are looking to buy a house, rent a car or even move into a new apartment.

For more money tips, check out TikTok money advice you should always avoid. Find ways to save more money with some our favorite storage challengesand learn what to do if you you can’t pay your credit card this month.


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