The subject of conservatism has been covered here before. One conservative value that will help you to exercise more control over your finances is that of paying for everything in cash.
The difficult part about paying in cash is that you have to have cash in order to pay with cash. This usually calls for a steady income and the reduction or complete elimination of debt. The two often go hand in hand.
Paying with cash will likely require you to develop new habits and a new way of thinking. However, the effort will be worth the reward. There are several potential benefits to paying for everything with cash. Consider the following.
You Will Make Fewer Impulse Buys
When you pay for everything in cash, you are less likely to spend money where you know you shouldn’t. It will help you to exercise more self-control over purchase decisions, because you will have to budget for everything.
You won’t necessarily make better decisions immediately or automatically. However, when you know that the cash in your wallet has to last you for a while, you will learn to plan and avoid unnecessary expenses.
You Will Make Better Purchase Decisions
In the long run, you will learn to make better purchase decisions when you have to pay for everything in cash. You will learn an important principle every successful person knows well. It’s called delayed gratification.
Let’s say, for example, that you have $800 in your wallet. If you know that the $800 has to last you the next 30 days, you probably aren’t going to go out and buy a $500 TV on a whim. You will have to assign a dollar value to your basic needs including food, gas, rent, and other necessities. In other words, you will have to learn to plan for and cover your bills and expenses before spending on items you can’t actually afford. And, if you find that you do have a “slush fund” left over, it will probably best serve you in your savings account.
You Will Curtail Debt
If you are paying for everything with cash, it serves to reason that you won’t be going further into debt every time you make a purchase. Moreover, because whatever money you have has to last you until you get your next paycheck, you will have to learn to make smarter decisions with what you have.
As you become a better steward of money, you will begin to make decisions that will put you in a better position over the long haul. You will make fewer decisions that put you further into the hole. It’s the little things that tend to add up, especially as it pertains to money.
Your Confidence Will Grow
Paying in cash for everything will boost your self-image and confidence. While others are still using credit cards to finances their expenses, you will be paying for things outright. It’s an exhilarating feeling.
As your confidence grows, you will put yourself on a positive cycle that will cause you to spend less, save more, and make decisions that have long-term vision. Amassing wealth is about having a long-term plan.