‘Cash padding’ helps South Australian family with $12k in debt

A revived trend that has given cash a new purpose has helped a South Australian couple rebuild their lives after years of credit card debt and financial stress.

After purchasing their first home, Nissa, a mother of two, and her husband were faced with the bitter truth that they were losing $12,000 a year due to “reckless spending.”

The stunning discovery was the “last straw” for the now 31-year-old, prompting the couple to change their spending habits and take a hard look at budgeting.

“It was shocking to realize how much money we were losing,” Nissa told news.com.au.

“It was like pouring water into a strainer and wondering why there wasn’t any left in it.”

Nissa stumbled across her family’s saving grace on YouTube, which was a video about an old-school method of saving, now known as “cash stuffing.”

The budgeting trend is to take money (usually your monthly earnings) from your bank account and allocate it to a folder, envelope, or case that represents a specific spending category.

The folders can represent weekly shopping budgets, fuel costs, mortgage payments, bills or holiday savings.

“A cash-stuffing video came up on my tips page on YouTube and I was hooked,” Nissa said.

The trend is very popular in the US and UK, however it is slowly starting to gain popularity in Australia. The hashtag “stuffed with cash” has amassed over 532 million views on TikTok.

While the method of saving money closely mirrors how some people organize their bank accounts online, there is a psychological aspect behind the trend that is not always experienced through internet banking.

Daniel Jovevski, CEO and founder of WeMoney, said behavioral scientists have found that physically seeing how much cash a person has in their name stimulates a sense of “pain” when they see the money go, preventing the urge to spend. plus.

“When we pay in cash, we feel a bit of pain when we see the amount of money coming out of our wallets or envelopes,” he told news.com.au.

For Nissa, the cash-saving trend brought a joy she didn’t feel through Internet banking.

“(There is a) sense of accomplishment. I am physically seeing my funds grow, I am physically seeing the improvements in our financial stability, and we are slowly getting closer and closer to not living paycheck to paycheck,” he said.

“Being physically able to hold the money, count it and watch it grow, to me that is so much more inspiring and motivating than seeing a number on a screen.”

One concern that comes with stuffing cash is how to do it safely, fearing that theft, fire, or simply misplacing it could result in the loss of hundreds of dollars.

While Nissa enjoys seeing her savings grow, she admits that she has a limit to the amount of cash she keeps at home.

“The cash envelopes we use for everyday expenses don’t stay ‘full’ for long,” he said, explaining that the contents of the envelope are a reflection of how much money the family needs for essentials.

Then, once her other packs reach a certain amount, Nissa will deposit her savings into a locked account at the bank.

“I keep track of how much money is going to go to what things and then I keep saving,” he said.

“The folders I use are A6 size and they are small. They are quick and easy to grab and I often take my cash envelope folder with me when I run errands.”

Nissa and her husband have now made up for the $12,000 they were losing each year and have since saved an additional $1,600 in the last six months, but their success has not been without its challenges.

“I’ve been trying to make the cash stuffing method work for us for the last four years and it wasn’t until the last six months that it worked, and that’s because I was trying to make everyone else’s methods work. Nisa said.

“Everyone’s finances are different, everyone’s expenses are different, and everyone’s debt is different, so we found that having a combination of a few methods works best for us.”

One particular inspiration that helped Nissa’s family grow their savings is Australian small business owner Caroline of CAROCASH, who helped Nissa “find her groove” with the cash-stuffing system.

“Since I changed my system and adapted it to our personal situation, our finances have improved,” said Nissa.

Nissa encourages anyone struggling with their finances to give cash stuffing a try and suggests that savvy would-be savers look to others for inspiration as a starting point.

She recommends searching YouTube for a how-to guide on the method, and suggests that those lacking inspiration look to Etsy for Australian-made cash-stuffing supplies like cash folders and wallets.

“I’ve learned that it’s a system you tweak as you go,” Nissa said.

“Baby steps, zero-based budgeting and cash envelopes – we’ve taken aspects of all of them and turned them into a system that works for my husband and me.”

“That’s the best thing about all this, there are no rules. Just do what works and what’s comfortable for you.”

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