In 2006, my wife and I started following some of the suggestions of Dave Ramsey. One of which, he recommends using cash to pay for certain expense categories. We were reluctant to start using cash. The idea of it made us uncomfortable at first. What happens in the grocery store if you get through ringing up and you need more? The answer is simple actually. You put something back. Okay, that works.
Let’s look at an example for Gas:
I pull in my truck, press the pay outside with credit button and fill up. I let it run until I hear it stop. The total is $67.84.
What if I pulled up with $60 dollars cash in my pocket? I press the pay inside with cash button. I start pumping and stop on $60 dollars’ worth (actually most of the times I get $60.01!).
I just saved $7.84 which I apply elsewhere in my budget. This seems like a silly concept but it works. I can vouch that it works. That $7.84 in gas doesn’t really get you much further anyways, especially these days.
I have actually come to love paying for gas with cash. Using cash money feels good and since you are working off of your zero based budget, you already know that the $60 is for gas and nothing else.
Some out there may argue about cash back rewards for gas. You give up these if you use cash to buy your gas. I would bet that the total amount of overage that you save by buying in cash increments amounts to more than your cash back rewards. On top of that, some gas stations are offering discounts for gas when you pay with cash. The local station near me gives a 3 cent per gallon discount when paying with cash. I recommend reading this article which talks about asking for a discount when paying with cash.
There is a restriction that is innate to using cash for purchases. You can only spend as much as you have on you. This applies to all cash purchases, but is highly evident with groceries and gas. If you can get past the mindset that cash is old school and obsolete, I’m sure you will see the benefits of paying cash for gas.
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