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I gave up my credit card for a month — and learned a lot about my spending habits

Without her plastic in hand, one woman was forced to face the cold, hard reality of her spending habits.
Without the comfort of a credit card in your pocket it's much more important to plan for the unexpected.
Without the comfort of a credit card in your pocket it's much more important to plan for the unexpected.Getty Images

The way some people can’t resist trying the latest workout craze, trendy fashions or exotic superfoods, I can’t find enough ways to challenge myself to be better at budgeting and trying new methods to save more money for the future.

I tried a spending ban last fall, and, like any crash dieter, quickly fell back into my old spending habits. When I came into 2018 with a fresh outlook on my finances and a credit card bill that put me in denial, it was time to take another, hopefully more permanent, stab at overhauling my spending. I tried to change things directly at the source of the problem and took up a “cash diet” — meaning no credit cards, electronic payments, Uber, Venmo, Starbucks apps, you name it — for a month.

Sounded easy enough at first, right? Just stop using my credit cards? After a conversation with NBC News financial editor Jean Chatzky, I wasn’t so sure.

“You get the psychology behind credit cards, and the reason they’re so easy [...] the money goes so fast because it seems less real,” Chatzky says of electronic payments.

“The reason this is such a good exercise is because you have no idea how the money is flowing,” Chatzky says, after prompting several spending categories I hadn’t thought of on my own (including iTunes storage, recurring Amazon purchases, and movie ticketing apps, to name a few). I had no real idea of how pervasive electronic payment was in my financial life, and how little I knew about my own spending, despite monitoring it regularly.

Chatzky recommended going cold turkey, sticking fast to the no credit card rule, and staying on task for an entire month to get in a full billing cycle. I was allowed to keep using my credit cards for recurring bill payments, and I could write checks, but any daily expenses had to be made in cash.

My personal goals were to see if I could actually stay within my budget, and really learn where my money was going. If there’s anything I learned from talking with Jean, it’s that I think I know a lot more than I actually do.

Armed with these parameters and a visit to the ATM, I was as ready as I’d ever been to go credit card-free.


The night before my “diet”, I wrote out my budget for the week, breaking down my spending into the categories I’d really be using (more or less: groceries and everything else), and planning out my spending based on my social calendar and everyday needs. Since I wouldn’t be using leftover gift cards through coffee apps, I’d have to budget for coffee as a semi-new expense and build in a little cushion, just to play it safe. To help keep things organized, I implemented a very high-tech system — using envelopes to keep cash in different budgets.

I also knew my roommates and I would be heading to Costco later in the month — I plucked $20 straight from my “everything else” envelope and into a “Costco” labeled one to try and build myself a buffer — it’s never an inexpensive trip for me.

My first week without plastic was not without road bumps. I was in for a rude awakening at the grocery store. I usually consider myself pretty on top of my grocery spending — but only because I stay under my “budget” at three different stores, and regrettably, that math doesn’t always add up. I walked into Trader Joe’s, cash in hand, and I could feel my anxiety kick in. Could I upgrade to Cara Cara instead of navel oranges? Was it a better deal to buy a bar of chocolate or a bag of peanut butter cups? Was that kombucha really going to enrich my life experience, or should I spend the $3.50 elsewhere?

Between the two grocery stores where I usually shop, the greenmarket stand on the corner, and a midweek banana restock, I came 54 cents in under budget on groceries, but that was a little too close for comfort. I added “staying comfortably within my grocery budget” to my list of goals.

Additionally, I’d just started drinking after a month-long hiatus, and an unexpected social event on a weeknight had me caving in to a drink — inadvertently, at a spot that didn’t take cash. The waitress (bless her) fronted the money on her own credit card, I gave her the cash, and had my first unplanned deficit in the “other” budget.

I quickly realized the challenge of not being able to use money I don’t already have, and how that can impact my social life. I have a habit of thinking of my social spending and my essential-but-not-planned-for spending as different parts of my budget, but they definitely are not. If my weekly budget is $100 one week, it seems like I can definitely get a new bottle of nail polish, order an extra drink at happy hour and take a cab home, right? Except that I also have two doctors appointments that will have $10 copays, and need more toothpaste, and completely forgot my grandma’s birthday and I have to get her a card, and some more stamps, and since I’m in the drugstore anyway I’m also out of ibuprofen... That one budget can shrink a lot, regardless of how it works in my brain. I wanted to challenge myself to overcome this mental separation without making myself crazy or feel like I was missing out on a lot of fun. I’d be choosing “stuff” and activities more wisely, not neglecting experiences I really wanted.


Socially, I was faced with a couple of challenges in week two. I knew I was already over budget because of the Costco run. I had a night in with the girls on the books (Seamless was a given for us), lunch with a friend from out of town, and drinks with my sketch comedy teammates after our latest show, in addition to all of the things I’d need to get through a normal week.

During week two, I had to grin and bear the great financial temptation of heading to Costco, and I was ready to fight it as much as possible. I walked in armed with a carefully planned list of things my roommates and I would share, as well as essentials I wanted to stock up on. I came with a list, I stuck to the list, and I still spent a lot of money (about two weeks’ worth of grocery money, to be exact). As I had a minor meltdown next to the shampoo, my roommate pointed out that these were all items I’d be using more or less every day — even if the sticker shock was high, it would be a worthwhile investment in the long run.

Costco’s credit card rules ended up hurting me — although my roommate had planned to use her card given my diet, I had to use mine since the membership is in my name. Putting over $300 worth of bulk items on a (debit) card seemed emergency enough to me.

My plan to pay off my Costco “debt” ASAP was to come in under budget on groceries for the remainder of the month ... and I didn’t quite succeed. I was quickly learning that timing is everything when budgeting. I needed to stock up on some everyday staples (for me, vinegar, tea, almonds and some frozen veggies), and that emptied out my “groceries” envelope sooner than I had planned.

My second credit card snafu came when I sat down to file my taxes — no way to pay that e-filing fee in cash. I took note in my spending spreadsheet and planned to pay myself back from my refund.

A few unexpected expenses popped up, too — in a moment of weakness, I grabbed a quick bite from my neighborhood deli, I needed to buy a sympathy card, and dole out the cash for a prescription that I thought would be covered by my insurance. And I was in desperate need of dry cleaning — but that would have to wait until the budget balanced out.


My social calendar this week, fortunately, revolved around beer — a cheap way to have a good time. I was able to keep a Friday night out and celebratory drinks with my comedy teammates to under $30 (thank goodness for happy hour). But, this week, I needed to actually buy things that weren’t groceries, and I was anxious about making it all work.

I was already a little tight on cash (I picked up some OTC medication, which was not as cheap as I would have liked, on my first day), and knew I’d need to start stocking up on other things that I’d been putting off replacing. I wasn’t entirely sure I could have a social life and go shopping the same week.

Although I’m not a big online clothing shopper, I do use Amazon quite frequently for pantry items and beauty products and was starting to feel the burn of not having that easy access to so many items (or that sweet, sweet Prime shipping). I’d been wistfully adding replacement tubes of lip balm, peanut butter and books to my cart, biding my time for a new month to start. Not the best practice during my month off from cards, I know, but not being able to buy things instantly forced me to reconsider those purchases and decide what was really important.

Not being able to buy things instantly forced me to reconsider those purchases and decide what was really important.

Fortunately, I was able to replace some exercise equipment at a discount store on the cheap, and use a two-for-one coupon to buy a few new tops. But I knew couldn’t go through life only buying things on sale, nor did I really want to. I was feeling a little dismayed by how tight this budget felt — on the one hand, I’m saving for a goal that’s important to me (I’m trying to buy an apartment in New York in the next few years). On the other hand, I don’t want to feel like I’m hemming and hawing over relatively small purchases or making myself crazy if I spend an extra $10 on groceries or on a cab home. I’d have to put some more effort into making this setup feel more livable or consider saving and budgeting differently.


After three weeks of telling myself I would come under budget on groceries ... I actually did it! One of the many perks of meatless meals is the cost — rice and beans are much more affordable than chicken breasts. I recognize that I have a tendency to impulse buy convenient ingredients (looking at you, pre-cooked beets and spiralized veggies), but am realizing more and more my spice rack can do a lot with very little when it comes to keeping things interesting and exploring new flavors.

I ended up having an unanticipated outing with members from an alumni organization I run, which set me back $20-ish that I hadn’t budgeted. Otherwise, I was able to plan and stay on budget for the trip I made to my alma mater (obligatory stop at the local pizza joint included) and happy hour drinks and snacks with a friend from school.

Since I was doing this experiment during a short month (thanks, February, for doing you!), I was going to cut myself a little slack on the last day of my fourth week, since it was technically the first of a new month and I’d be back to using a credit card (if I wanted). I did use my Starbucks app for a coffee, but other than that, was able to stick to cash.


The biggest takeaways from my month on a cash diet? To plan, and to plan for the unexpected. Although I usually track my spending after the fact (sometimes even a couple of weeks after the fact), taking five minutes to look at my calendar on a Thursday night and plan out where my money might go was a huge help in staying on track. Even when I went over budget or unexpected things came up, I was more or less able to make up for it.

Taking five minutes to look at my calendar on a Thursday night and plan out where my money might go was a huge help in staying on track.

Additionally, I’ve learned that the unexpected needs its own budget. Moving forward, I’m going to open a new savings account as the electronic version of my “Costco” envelope — for things that aren’t part of my weekly or monthly budget exactly, but don’t want to pull from my major savings. I’m starting with a small number — $20 per week — and plan to build on it and change as needed.

One thing I’m still figuring out is how to balance those non-essential spending things with social outings. I’m still not entirely sure what will happen if I ever need to buy new clothes and also go out in the same week, but I’ll cross that bridge when I come to it.

And, finally, I think I’m going to stick with cash as much as possible. I was shocked by how much easier it was for me to keep track of things with cash — the complete opposite of how I’d been rationalizing my credit card use before this experiment. Once I can get into a good groove with staying on track for groceries and build up my new savings, I will switch back to using cards for certain expenses so I can continue getting cards benefits (hello, travel miles), but otherwise, I’m feeling good about keeping things analog for now.


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