Gen Z Embraces “Cash Stuffing” Trend: A New Way to Budget
In a world where digital wallets and online bill payments reign supreme, Gen Z is turning heads by embracing a new trend called “cash stuffing.” According to a 2023 survey conducted by The Harris Poll for Credit Karma, 69 percent of Gen Z report using more cash now than they did the year before, with 23 percent using cash for most of their purchases. This trend has gained popularity on TikTok, where users are sharing their experiences with this unique budgeting method.
So, what exactly is cash stuffing? It’s a way of managing personal spending by using physical cash. Also known as the “cash envelope system” or “envelope budgeting,” cash stuffing involves placing cash into labeled envelopes for different expenses and using only that cash throughout the month. This method helps individuals control their spending and stay within their budget limits.
The benefits of cash stuffing are clear. By limiting spending to the cash on hand, individuals can avoid overspending and make more thoughtful purchasing decisions. The act of physically handing over cash for purchases can also provide a better understanding of spending and encourage financial discipline. Additionally, using cash prevents the accumulation of credit card debt and supports stronger willpower and financial control.
However, there are risks associated with cash stuffing as well. Keeping large amounts of cash at home or on your person can pose a security threat in case of theft or loss. Additionally, paying in cash means missing out on the purchase protection and rewards offered by credit cards. Cash transactions are also harder to track compared to electronic payments, which can lead to overspending or borrowing from one envelope to fund another.
For those interested in trying cash stuffing, there are a few steps to follow. First, determine your budget across different spending categories and allocate cash to each category. Then, withdraw the necessary cash from your bank account and place it into labeled envelopes. Throughout the month, spend only the cash available within each envelope and track your expenditures to ensure you stay within budget.
While cash stuffing may not be suitable for everyone, there are alternatives that capture the spirit of this budgeting method without the need for physical cash. Prepaid debit cards, budgeting apps, and certain credit cards can help individuals budget across spending categories and track their expenses effectively.
In conclusion, cash stuffing can be a useful tool for those looking to reign in their spending and stay within budget limits. However, it’s important to weigh the benefits and risks of this method and consider alternative options that may better suit your financial goals. Whether you choose to embrace cash stuffing or explore other budgeting methods, the key is to find a strategy that works best for your individual financial situation.