I Spent Two Weeks Using Only Cash — Here's What I Learned

I’ve always considered myself fairly financially conscious. Well, financially conscious in the sense that I’m conscious of all the “golden rules of finance” — don’t spend money you don’t have, watch your daily spending, save whenever you can — I just don’t do a great job of actually following them. Let’s think of it as operating on a “what you don’t know can’t hurt you” policy: As long as I don’t look at my bank account, it’s like I’m not even spending money, right? (Wrong.)

Somehow, I made this system work for most of my young life. But when I moved to New York City this spring and suddenly found myself face-to-face with Manhattan’s infamously steep prices ($15 for a vodka-cranberry?! Really?!), the years of unsolicited lectures from my (very financially savvy) parents on the importance of watching your spending didn’t seem so annoying. Oh, and I had just started interning with the Work & Money team at Refinery29. Yeah, the irony wasn’t lost on me, either. Suffice it to say, it was time to get my act together.

I resolved to boldly go where other more financially aware women have gone before: I would try using cash for two weeks to see if I could finally save money. I based my model on a blog post by Ramit Sethi, personal finance advisor and author of I Will Teach You to Be Rich. He claims that by using only cash for two weeks, you can save up to 18% of your usual two-week spending.

Hypothetically, this shouldn’t be too hard. As a college student doing a three-month-long internship in New York, I don’t have many financial responsibilities. I’m extraordinarily lucky and privileged in that I received a $1,250 stipend from my school, and my parents pay my monthly rent at a women’s boarding house, which includes breakfast and dinner each day. To top it off, my parents generously contributed an extra $750 to my three-month budget and set up a credit card in my name for “emergencies,” which I apparently have a lot of due to how quickly I’ve been running through my available credit.

So partially for the sake of this meager budget, but mostly to satisfy my competitive streak, I chose to take my experiment one step further. Sethi says using only cash can save you 18% of your two-week spending. I decided to subtract 18% from just one week’s worth of spending, and make that number last for two weeks.That’s right, folks: I, the super spender, would try to make 18% less than what I usually spent in just a week last for an entire 14 days.

Would it work? Would I be able to survive on a cash-only, two-week, super-tight budget? Or would I cave to the pressure of the trusty debit card in my pocket? And most importantly, would this change how I spend forever?

Ahead, I’ve compiled the four pros and two cons I learned on my cash-only roller coaster ride of an experiment, interspersed with some real-world advice from certified financial planners much more knowledgeable than myself.

Illustrated by Paola Delucca
Before I even began using only cash, I had to track how much I spent during a typical week of credit and debit spending (and yes, some cash, too). As you might have predicted, I was positively shocked by how much I spent over just seven days. I blew $364.94 just in credit and debit card use alone — I couldn’t even remember how much cash I had in my wallet at the beginning of the week, so my actual spending was probably more.

This step is crucial to understanding your finances, even beyond its jumping-off purpose for my experiment. Although it might seem like common sense, tracking what you’re spending each week is often the first thing financial planners recommend, including Marguerita Cheng, a certified financial planner and CEO of Blue Ocean Global Wealth.

“I think most people really aren't aware of how much they're spending, [because] it is hard,” she says. But tracking can give you “an idea of what you're spending money on…[and when you] see where your money is going, then perhaps you can make adjustments.”

Armed with my newfound knowledge of how much I spend on a weekly basis, I used my rusty math skills (read: iPhone calculator) to calculate 18% of my approximately $365. This left a grand total of $300 I could parse out over the course of the two weeks. Bring it on.
Illustrated by Paola Delucca
Because I had only withdrawn a set amount of cash, I had to think of creative ways to get around my usual haphazard method of throwing a card at nearly every expense that came up during my daily life. Cheng recommended putting only half of what I’d taken out in my wallet, and aiming for a $20 limit per day. Since breakfast and dinner are included in my rent, this limit was more than enough for my weekdays, when I only really needed to pay for lunch.

But of course, the lures of the aforementioned $15 vodka-cranberry made my weekend budgeting significantly more challenging. Having only $20 dollars in my pocket lead me to take a long, hard look at every menu I was handed, and choose accordingly, even turning down certain items I would have normally purchased without hesitation (insert vodka-cranberry here). Beyond that, I was forced to plan ahead, texting my friends sometimes days in advance to make sure our weekend plans didn’t include trips to NYC’s swankier establishments.

Stephen Barnes, the chief investment officer at Barnes Investment Advisory, had a similar reaction when he and his partner went through their own experiment of using only cash for dining out.

“Using cash did change our behavior in terms of what we chose off the menu and those types of things,” he explains. “When you're offered something like another glass of wine, you can see how much money's in your pocket and you can look at what it costs, and say, ‘No, I think I'll pass on that second glass of wine.’ That makes a pretty big dent real quick.”

Barnes’ experiment with using only cash was so successful that he and his partner managed to save 25% on their weekly food budget, and they continue to use cash-only when dining out. His experiment also lead him to recommend clients similarly use only cash for any extraneous purchases.

“The closer your payment decision is to the purchase choice, the more likely you are to modify your choice based on what mode of payment you're using,” he says. “So yes, I recommend cash for any point-of-sale purchase decision.”
Illustrated by Paola Delucca
As I said, breakfast and dinner are included in my rent. Therefore, I shouldn’t be spending any money on eating out for those meals, right? That’s what I thought, too. But as I began my first cash-only week, I realized fairly quickly that I’d developed a pattern of eating dinner out — even though I’d already paid for my daily meals.

If that wasn’t bad enough, walking around with just $20 in my pocket forced me to confront head-on my tendency to impulse buy. I noticed when I looked over my debit card statement from the previous week there were many small, one-off charges — ranging from a $4 pair of drugstore sunglasses to a $50 online order of cruelty-free, vegan, organic, coconut-oil infused biotin pills. Who even needs that?! I’d chalked those purchases up to a suspiciously spend-heavy week, but having only a set amount of money readily available made me realize that my “I absolutely need this right now!” spending was actually becoming a habit.

“Using only cash forces you to challenge your expenditures a whole lot more,” says Glenn J. Downing, a certified financial planner for CameronDowning. “You'll think about whether you need a large coffee or whether a small coffee will do. Any number of little decisions, over a two-week period in time, can add up to hundreds of dollars.”

In my entire two-week experiment, the only “me” thing I bought was a Moleskine notebook — and only because it was 20% off. Most of my expenses were things I needed to survive, like food for lunch or an occasional cab when walking or the subway would be just a little too sketchy. Compare that to my usual spending on pills I know I’ll never use and cheap sunglasses that will probably break within a week, and I managed to knock off a pretty sizable chunk of my budget.
Illustrated by Paola Delucca
An added, totally-unforeseen bonus: This experiment forced me to become much more innovative when it came to fashion and cuisine. Before my experiment began, I’d convinced myself I absolutely needed to buy new going-out wear for a big event. Turns out, I wasn’t willing to cough up $70 for a new dress when that would translate to about three days without lunch (um, no). My lack of monetary resources actually inspired me to become more creative with how I reused and combined the “boring” pieces in my closet. By layering and accessorizing and even tying or pinning my clothes in different ways, I created a “new” outfit I didn’t know I had — all for a whopping $0.

Speaking of lunches, I soon realized just how much of my budget was eaten up by food. While this isn’t a bad thing at all (a girl’s gotta eat!), I definitely wasn’t being as careful or economical as I could have been. Case in point, my usual average-sized grilled cheese from the shop just down the block cost $10. Expensive, but convenient. But one day, unwilling to spend half my day’s ration on one measly sandwich, I ventured just a few more blocks down the street. It was there I stumbled into an Italian deli and discovered the mother of all meatless sandwiches: a whole wheat baguette sliced down the middle and filled with tomatoes, mozzarella, basil, and olive oil. When I say this thing was big I mean big, like the length-of-my-arm big. The best part: It was only $11. So for just a dollar and a few blocks more, I had lunch for not just one, but two days, and in the process discovered the best vegetarian panino this side of the Atlantic.
Illustrated by Paola Delucca
As with all things, though, there’s a catch. It’s not like sticking to paper money will take you down the fast-and-easy yellow brick road to becoming the next Wizard of Wall Street. In fact, while using only cash might make budgeting easier for some, sometimes feeling your money physically in your pocket could sabotage your thrifty goals.

“Let’s say a guy goes to a bar and he’s got a hundred dollars in his pocket,” says Jonathan Swanburg, a certified financial planner and investment executive at TriStar. “Sometimes, if you have a $100 in your pocket, you end up spending a $100. You buy a round of drinks, you tip a little extra...You sort of have that money [already there], so it’s gone.”

While I managed to circumvent this pitfall by limiting the amount of cash I was carrying on a daily basis, it’s important to note just using cash alone won’t necessarily limit your spending. The key to a successful cash-only experiment is a combination of prior budgeting and being mindful of how much money you actually have at hand — and the will to stick to your plan. For me, knowing I had to publish the results of my experiment kept me from burning through the money in my pocket just because it was there. Anticipating that the most brutal critics of all — the Internet — would have court-side seats to my personal success or failure was an extremely effective motivator to not overspend.

Of course, not everyone attempting to modify their spending will broadcast their experience on the Worldwide Web for all to read, so even something as simple as telling family or friends of your budgeting plan may help keep you accountable. Who knows — they just might be inspired to join you.
Illustrated by Paola Delucca
And then, on the tenth day of my successful and fairly stress-free only-cash experiment, the unexpected occurred.

I found myself in a card-only restaurant.

And had to use my debit card.

It wasn’t much, just $10.80. But I found myself wondering why I’d swiped instead of just walking away. There were, of course, a myriad of reasons, some better than others: I’d already received my food; I didn’t want to be rude; I was tired and hungry; I only had a few minutes left before I needed to return to the office. But the reality is, there are many areas of our lives, especially in cities, where using only cash just isn’t always practical, or even feasible.

Using only cash could, for example, limit your ability to shop online, an option which can sometimes be cheaper than buying in-person, says Swanburg. In addition, “if you put [expenses] on a credit card you get that 2% cash back, or you get those points, which at the end of the year really start to add up,” he says. Using a credit card helps build credit — necessary if you want to buy a home or a car at some point. Not to mention the importance of a credit card if an emergency situation crops up: $20 in your pocket isn’t going to get you far if your car breaks down on the side of the road in the middle of nowhere.

Furthermore, although I might’ve saved money using only cash for two weeks, the benefits might be only short-term.

“People recommend you take ‘spending holidays’ where you just don't spend money for ‘X’ amount of days, and that's how you put money away,” Swanburg says. “But the reality is, all those do is just postpone those expenses for another day. Yeah, you may eat ramen and hot dogs for that two-week period, but that's not really what you want to do, so you're probably going to splurge on something when you're done.”
Illustrated by Paola Delucca
And splurge I did.

By the end of the two weeks, I’d used only $250 of my $300 budget. While I was excited, I was also exhausted. It had been a long 14 days of turning down social invitations because I knew I’d be tempted to spend more money than I could, of buying the cheapest lunch options I could find, of almost ritualistically checking my wallet to make sure I had money. It reminded me almost of a diet. I had “starved” myself of buying what I wanted for so long that I “binged” first thing I could, ordering five things on Amazon I’d held off buying during my cash-only two weeks. So, yes, I managed to save money, but I also managed to blow what I’d saved fairly quickly after my two-week test was over.

I’ll concede that using only cash for a period of time works. But if you’re going to try this at home, I’d recommend a less extreme route.

Maybe, like Barnes, choose only a facet of your budget with which to use cash, whether it’s eating out or trips to the nail salon. Or choose a budget that’s less constrictive, so you can afford some “me” things without feeling like you’re totally blowing all your hard work.

But, as always, the most important takeaway remains: choose a money management technique that works for you. I might not use only cash from now on, but if there’s one thing I’ve learned from this experiment, it’s knowing that the rest of my emergency money will be used for just that: emergencies.