9 Reasons Using Cash Instead of Credit Cards Creates Financial Freedom

Here are 9 Reasons Using Cash Instead of Credit Cards Creates Financial Freedom.

This is inspired by the fact that switching to cash only 2 months ago has saved us so much time and stress!

We actually have no credit card debt, and haven’t for years, however, using credit cards to pay our monthly expenses was making us overspend without us even realizing it!!!

My husband Jomel used to ask me about our spending, now he knows exactly where ever penny is going.

He also spends WAY LESS with cash (he spends 176% more with credit cards than with cash!!!!).

Now we work less, and have more money than just 2 months ago, and can continue to add money to all of our investment accounts!

Wow!

I wrote this blog post about 9 Reasons Why Using Cash Instead of Credit Cards Creates Financial Freedom to help you understand why this happens.

Reason #1 Using Cash To Spend Fires Pain Sensors in the Brain

I learned this from watching a Dave Ramsey video back on October 20, 2020.

He said there are scientific studies that show that using cash sets off pain sensors in the brain, and they don’t fire off when we use credit cards.

It has to do with our feeling that as we spend cash, we are not going to get all of our money back.

When we spend on a credit card, and get the credit card back, we feel like we are not losing anything.

Reason #2 Using Cash Prevents Overspending

Using cash will keep you from overspending.

This is because, you have a finite amount of cash on you, and you can’t actually get more unless you leave the store and go get more.

Just leaving the store might make you realize that you didn’t need to make the purchase anyway.

Reason #3 Using Cash Prevents Borrowing Money

Because you are using cash, you are no longer borrowing money on credit cards when you spend.

No more borrowing money!

Wow!

Reason #4 Using Cash Forces You to Budget Your Spending

Because you have a finite amount of money on you, you need to figure out how to budget what you have to get what you need.

You will become aware of your spending more.

Reason #5 Using Cash Makes Money Harder to Get – So You Spend Less

You need to go to a bank or ATM to get cash, that’s more work.

Just having that extra step will make you less likely to spend as much.

Reason #6 Using Cash gives you a physical Way to Touch Money And Feel More Abundant

I find that spending in cash makes me feel richer.

Feeling rich is important, because that’s the first step to actually being rich.

Reason #7 Spending Less Money, Leaves You More Money

Because you spend less with cash, you end up having extra money in the bank every month!

That will make you feel richer automatically =)

Reason #8 If You Are Using Credit Cards Now and You Switch to Cash, Your Decreased Spending Can Be Used to Pay Down Debt

If you are using credit cards now, you are probably overspending.

So switching to cash will make a big difference in the amount of savings you can have.

You can use those savings to pay down your credit cards and never have credit card debt again!!!

If you don’t have credit card debt, like us, then you can use the money to pay off your mortgage.

Think about how much less money you would spend every month if you didn’t have to pay your mortgage!!!

Reason #9 Your Increased Savings Can Be Invested Into Stable Passive Income Investments to Create Financial Freedom

Now that you have increased savings, you can invest into stable passive income investments to create financial freedom.

Some stable investments are long term US treasury bonds, preferred stocks, rental properties, savings accounts, CDs, the All Seasons Portfolio and so on.

When your passive income is greater than your expenses, you are financially free!

Conclusion

Cash spending and using savings to invest for financial freedom might be the easiest way for you to create real and lasting change in your finances.

From our 2 month experiment, my husband and I have found our expenses drop a huge amount.

This allows my husband and I to work less but still pay for our 2 bedroom condo in Waikiki, healthy and nutritious food and all that we need.

Just try it for yourself for 1 month!

Put away the credit cards and only keep cash in your wallet.

You’d be amazed at the difference!