You will often hear me recommend that you use cash for purchases whenever you can. There are many reasons for this.

The most common argument I hear against using cash is: 'I spend it too fast', followed closely with 'then I wouldn't get the points on my credit card'. The credit card issue is a separate one, and is easily answered as well, but the first issue needs to be addressed before you can benefit from the credit card points anyway.

If you want more money you need to know how much more; you need to know what you want it for; and you need to have these reasons written down. Some of these things will be fairly close to your purchasing grasp today, and some will be for luxury items you currently enjoy but really 'should' be using that money for other things. Some examples might be the lunches or coffee out you currently enjoy easting out, or the new digital doodad you've been eyeballing for months but don't quite have the cash available to buy it.

When you use cash, you will be forced to make some decisions about you upcoming spending ahead of time, thereby creating a sort of mental budget. When you use cash for your purchases you also get change back. For most people that money goes right back into their wallet for the next purchase and the little bits left over get stashed in a jar somewhere at home waiting for that someday when you're going roll it all up and take it to the bank.

Right now, decide with a paper and pen what sort of things you would like to have more money for. Write them down, and then for the most immediate and important ones allocate a place you can start to accumulate money for. If you want to have more money to eat in restaurants, then designate that you will put all the $5 bills you get back as change from your regular purchases. If you'd like to have money for that digital doodad, then decide right now how much you'd like to accumulate, where you'll begin your 'cash stash' and which denomination of currency you're going to allocate to the cause.

When you make your regular cash purchases take that denomination of currency and keep it separate from your regular spending money. Or, just for fun, when you get change, rather than putting it back in your wallet to spend, put it in your pocket. When you get home empty your pockets into your pre-designated savings places.

This technique works for many types of saving, spending, and giving plans and has many benefits besides being able to have the things you want from your money. You just have to do it and keep doing it - knowing that the money will come when you are being intentional and strategic in your planning.

Copyright 2006 Tracy Piercy CFP

MoneyMinding Inc. and Tracy Piercy accept no liability for the content of this article or for the results of any actions taken or not taken, on the basis of the information provided. The content is intended for informational purposes only and is not a substitute for professional, personal financial advice.