Is It Time to Go on a Cash Diet?

As a boy in junior high, I used to mow lawns in my neighborhood to make money during the summers. The lawns where I grew up were very small and would only take about 20 minutes to mow, but I would haul in $15 per lawn (pretty good for a 7th grader in those days!).

I remember the great feeling of getting that cash in my hands after another week’s worth of lawns were done.

At the end of the week, I would take 1/3 and set it aside for church, 1/3 set aside for savings, and would use the remaining for spending money. This taught me valuable lessons growing up on the importance of both saving and giving.

Unfortunately, some of those lessons wore off when I was introduced to credit cards at age 18. I had to relearn some of those valuable lessons, which was painful. But with getting ahead financially, just like with losing weight, comes making necessary sacrifices to reach our goals.

Lifestyle Change Required!

When trying to reach our target weight, crash diets are no good! You need something more consistent, more like a lifestyle change with eating and exercise habits to make the change last.

In personal finance, however, sometimes a cash diet (not a crash diet) is necessary to get the ball rolling to help you reach your goals. This doesn’t mean you will always live with a cash budget (although you certainly could).

Oftentimes when folks are in debt, they continue to use their credit cards and wind up spinning their wheels with their debt. By taking a credit card fast, and using cash for every single purchase, you can begin to purge some of the negative spending habits you may have caught.

Before you embark on a cash diet, you’ll need to take care of some necessary budget planning.

Working Within Your Budget

Budgeting usually isn’t fun, but it is a necessary part of getting ahead financially. It is essential to help you understand cost cutting ideas, where you can reduce expenses, and how to achieve your financial goals. It can also help you with your cash diet.

Unfortunately, it seems like too many folks these days don’t work within their budgets, which means when emergencies arise they are forced to do things they shouldn’t do – like borrow from their 401k or take an early IRA withdrawal!

When is the last time you reviewed your budget? My wife and I are in the process of reviewing ours again as we look for areas to cut back in order to save for a new goal – a swagger wagon. Just the other day, my wife reminded me while grocery shopping that we were in “cut back” mode. Needless to say, I had to put something back on the shelf! 😉

Sometimes it takes big sacrifices in order to meet your goals, and other times it takes little ones. Either way, understanding your budget and aggressively saving is the long-term answer to make the financial changes necessary to reach the goals you have.

Here are some additional resources to help you reach your goals:

  1. 10 Money-Saving Tips to Stash $10,000
  2. 10 Free Household Budget Spreadsheets
  3. 15 Ways to Cut Your Expenses

Have you ever been on a cash diet? What do you think of them?

Photo by

Ready to Quit Living Paycheck-to-Paycheck?

Just click to join 225,000+ others and take our FREE email course to better manage your money, pay off debt, and save! And get FREE access to our money-saving workshop ($29 value)!

Related Articles:

  1. Jackie

    I’ve heard that this helps a lot of people. It might actually help me too, if I forced myself to go to the bank to take out cash every time I wanted to buy something, because I hate going to the bank. I may give it a try in the future but for now I’m going to “diet” by just reducing my spending in general.

  2. [email protected]

    Living mostly on a cash diet has helped us a great deal. When we start using the convenience of a debit card or even the checkbook we don’t do as well. Even with our budget in place! There is just something about your hard earned cash physically leaving your hand! Thanks for the great post!

  3. Jason Topp

    Jackie, if that works for you then keep doing it! I hate going to the bank too! 😉

    Tara, you are right, something about cash in hand makes you think twice about spending it!

  4. MortgagesByMark

    Ah, the old envelope system! It really works. Going cash and setting aside a designated amount of cash into envelopes for each monthly expense at the beginning of the month really helps control spending. Once the cash runs out, that’s it! No more spending on that item. Plus, when it’s cash you’re parting ways with, it hurts a little more than swiping a credit card. It’s more tangible and helps control spending more.

  5. 20 and Engaged

    I’m more conscious with cash but it’s really tedious (for me) to carry it. I just try to be mindful before swiping the plastic.

  6. Jason Topp

    I think the important thing with a “cash” diet is not so much whether it’s cash or not (debit cards are great), but it’s really an awareness of your budget, and the ability to clamp down on expenses to ensure you can reach your goals.