e Cash Diet
Paying strictly with cash money (no plastic!) most of the time is ideal for anyone who is routinely surprised by the length of their credit-card statement, the echo in their empty bank account or how often they get dinged with overdraft fees. Of course, there will be some exceptions to the rule – like buying a plane ticket – but beyond that, do your best to use paper notes exclusively. Even one month of cash dieting can give you a more reliable understanding of your main money leaks.
Add up your monthly post-tax income. Subtract your fixed bills (rent, bond, utilities, transportation, cellphone, loans) as well as any amount you put towards retirement and/or savings.
Use the leftover amount as your spending money for the month. If this is your first cash diet, set aside a R1 000 buffer for surprise expenses such as an impromptu doctor’s visit.
Divide your stash by four to give yourself a smaller fixed amount of cash to use each week, and withdraw only that amount – seriously, only that much! – from the ATM.
Track how fast you’re spending. When you’re out of cash, no more spending for that week – or month! If you have any money left over, roll it into your spending for the next month.