Could you cut up your credit cards and go cash-only?

May 16, 2019, 3:44 PM
Could you go cash-only?...
Could you go cash-only? Dave Noriega outlines the system his mother used to keep from getting into debt. (Image: Pixabay)
(Image: Pixabay)

It’s easy to overspend when all of your money is on a card. You just pick out everything you feel like eating at the grocery store, roll it up to the clerk, and don’t even bother noticing the price they list off when they ask for your money. Instead, you just hand them the card and move on – no matter how much it costs.

Maybe that’s why the average Utahn has so much credit card that, according to the American Bankruptcy Institute, it’ll take the average person in this state 17 years to pay it off.

But what if we fixed a new problem by doing the old-fashioned way? What if we cut up our credit cards and went cash-only?

KSL Newsradio’s Dave Noreiga explained how his mother used cash to keep her budget in line — and how he learned the hard way that he should have followed her example.

How to live cash-only

Cash-only envelope system

(Image: Pixabay)

Every month, when the Noriega family’s paycheck came in, Dave says that his mother would take all the money they had to spend, put it into envelopes, and stashed in her sock drawer.

That money, he says, was it. It was never replenished and his mother never broke out the credit cards. They just spent the money in that envelope and, when it ran out, stopped spending money.

“If there was some money there, we could have some fun,” Dave says. “But once that envelope was empty, it was gone.”

Some money would be stashed into an envelope for food and some in an envelope for everything else, but everything had a specific, set budget. If they budgeted $500 a month for groceries, they had to stay on that budget. As long as they stayed strict to the system, they didn’t have any choice.

“You learn to budget in each area,” Dave says. “It wasn’t just: ‘Hey, I’m really, really good about not buying new clothes, but I’m terrible about buying food.’ It was: ‘I have to be good in every area.'”

Dave says it worked. “It kept her out of debt, it kept her out of credit card use.”

Cutting up credit cards

Credit cards

(Image: Pixabay)

Dave Noriega follows in his mother’s footsteps — or, at least, he does now. That wasn’t the case, though, until about three weeks ago, when his wife didn’t give him any choice.

“I got a post-it note from my wife,” he says. “There was a post-it on the side of my bed and it said: ‘These are your credit card charges.’ I had racked up $350 in credit charges that she wasn’t prepared for.”

Despite his mother’s good example, Dave says that he made all the mistakes she avoided. He signed up for every credit card that offered a small in-store discount and pretty quickly lost track of how much money he was spending.

“I’ve been through some dark times,” Dave says. “I get sucked into it. It has been toxic to my life.”

Finally, his wife put her foot down. She left him that post-it note on a stack of twenties, letting him know that, from now on, he was going to be doing his shopping his mother’s way: with a set budget in cash that just can’t exceed.

“An allowance,” Dave says. “I flat-out get an allowance.”

More to the story

Whether you call it an allowance or a budget, it works. Read about how Dave Noriega now uses his mother’s system to feed a family of five for just $400 a month.

And listen to Dave Noriega tell the story himself on the Payday Monday podcast.

Dave & Dujanovic can be heard weekdays from 9 a.m. to noon on KSL Newsradio. Users can find the show on the KSL Newsradio website and app, as well as Apple Podcasts and Google Play.

affordable care act

Payday Monday

Credit Card Skimming Device...
Debbie Dujanovic

Illegal credit card skimming: Three habits I changed at the gas pump

According to the FBI, credit card skimming costs banks and consumers $1 billion a year when unwitting customers encounter the devices on the street.
2 years ago
Biden moratorium Romney lee approval, Romney earmarks...
Mary Richards

Utah Senators on impeachment trial: Romney pledges open mind; Lee says defense is strong

Utah senators Mike Lee and Mitt Romney are speaking up about their feelings on the Presidential impeachment hearings.
2 years ago
Utah child tax credit, Campaign financing reform, pay gap...
Colby Walker

How Millennials can invest with elite money managers — without breaking the bank

(CNN) — Robinhood brought free trading to the masses. Betterment and Wealthfront automated financial advice for millions. Now, Round is seeking to level the investing playing field even further, by admitting Millennials to the exclusive club of elite money managers. Everyday investors have limited access to actively managed funds run by top-tier Wall Street firms. […]
3 years ago
buy home prices 2020 millennials...
Anna Bahney, CNN Business

Thinking of buying a home in 2020? Trust us: read this first

Buying a home in 2020? Ogden, Utah was one of ten cities identified as a place you will wish you had bought in 2020, once 2030 rolls around.
3 years ago
holiday deals...
Colby Walker

To buy or not to buy, the best holiday deals might come after Christmas

There are a number of holiday deals as last-minute shoppers deck the malls, but the best time to buy some of those gifts might actually be after Christmas.
3 years ago
(Getty Image)...
Colby Walker

Utah takes top 3 most charitable cities in US

After Black Friday and Cyber Monday comes Giving Tuesday - and Utah has some of the most charitable cities in the entire country.
3 years ago

Sponsored Articles

Prescription opioid...
Know Your Script

Prescription opioid misuse | How to protect your family from the opioid epidemic

Studies have shown that prescription opioid misuse has increased since COVID-19. So what do you need to know about these opioids?

Tax Tuesday: The Most Common Mistakes People Make When Filing Their Taxes

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.

Tax Tuesday: How will last year’s child tax credits affect you?

Fortunately, for most average earners, they will not end up owing overpayments received for the Child Tax Credit in 2021.

Tax Tuesday: Key Information Before the Filing Deadline

Businesses can receive a credit of up to $5,000 per employee in 2020 and up to $21,000 per employee in 2021.
national heart month...
Intermountain Healthcare

National Heart Month: 5 Lifestyle Changes to Make Today to Keep You Heart Healthy

Heart disease is the leading cause of death for both men and women. One person dies every 36 seconds in the United States from cardiovascular disease
Joseph Smith Memorial Building...
Temple Square

The Joseph Smith Memorial Building is an icon of Salt Lake City | Why hosting an event at this beautiful location will make you a hero this year

Here's why hosting an event at the iconic Joseph Smith Memorial Building in downtown Salt Lake City will make you a hero this year.
Could you cut up your credit cards and go cash-only?