If you have been an avid reader of this blog, you have probably read about our monthly grocery budget. This might surprise you, but different from the average bank customer, I meet my ATM only once a month.
You see, I know that this ATM around the corner from where we live does not give me my money for free. No, it slows down my ship to the golden shores by reducing the members of my rowing team. It is like a downsizing cycle in a company, do it once, know the exact number of employees that have left, and concentrate on moving your company forward.
I, for one, prefer to meet my employees on their way out. And I want to see them being put to good use. As you probably know by now, I enjoy spending quality time with friends and the occasional night out. I have learned in the past that there is nothing more dangerous than cards once you have reached your 3rd or 4th drink. It is the moment when all good intentions are forgotten and swiping your card through the bar’s car reader suddenly seems a good idea; regardless of your previous convictions.
One night, in Madrid a few years ago, I ended up spending a whopping € 150 just on drinks. It was a fantastic night and I would not want to miss a second, but the following day I still felt that the money could have been used for better purposes than a hangover.
I thus, over time, refrained from using my card on a night out. I have a certain amount of money that is allocated to nothing else but the joy of nights out. Every month, on the same day, I meet the ATM and withdraw some of my employees, divide them into weekly chunks, and enjoy nights out with no more regrets. More importantly with no more card in my pocket that might find its way to the swiping slot of one of those expensive bar readers.
There are multiple benefits in seeing your hard-earned cash before spending it:
Psychological – seeing, smelling, and touching the notes gives them a different significance; particularly before parting ways with them when handing them over to the bar tender.
Management – having a stash of tangible notes at home makes it much easier to separate them into four chunks; one for each week of the month. This is impossible if you pay with your card; whether debit or credit card.
Visibility – having the amount of money left in front of your eyes gives you instant feedback on well you have been keeping control over your spending. The more you have, the more you see that you can still spend. If only a few notes and coins are left, you know it is time to cut back on your spending.
Happiness – you will be amazed that once you have started managing your money through cash reserves, two phases of happiness set in: when you initially take out the money and hold it in your hands. You will feel like Scrooge Duck. The second time you will feel happiness is when you are nearing the end of the month and you still see a nice chunk of money available for your nightly pleasures.
Creativity – you’ll be surprised how creative and innovative once mind is when it is forced to think of alternative. In those months when you are running short and have spent a few dimes too many in the first few weeks of the month, your brain will come up with alternatives to spending your nights out. And you’d be gobsmacked by how many of your friends and colleagues feel the same way as you. Many people feel the need to keep up with the Joneses, but the savvy sailor will be able to think of other options to spend a fantastic evening: BBQs, picnics, a couple of drinks by the lake or on the beach, or a shared keg in someone’s backyard.
You will see, running out of money is no longer an option. Your brain will soon adapt to spending only what is left in your stash and think of awesome alternatives when the stash does run too low.