Even though you may have heard the term “pain of paying,” you’ve probably not given it much thought.
Did you know that scientific experiments using MRIs show that spending with cold hard cash triggers brain activity in the same regions as physical pain?
From this research, it is easy to hack your way into spending less with cash.
You see, using plastic to pay does not trigger the same pain sensation. This means that you are more likely to spend more using a credit card because you do not experience the natural stopping mechanism cash incites when you physically see and feel that your wallet is almost empty.
Dan Ariely, a Duke University psychology professor talks about this concept in his book, Dollars and Sense. He uses principles from neuroscience to show readers how to save more money. He says anything which makes transactions smoother, including credit and debit cards or using the Amazon one-click buying process, reduces the pain of paying. Thus, encourages you to spend more.
Other studies show that people using credit cards leave bigger tips than those who pay with cash. And people using credit cards make larger purchases than people using cash. These studies confirm the idea that we view cards as “Monopoly money” rather than a part of our budget.
Furthermore, people underestimate how much they have spent when they use plastic cards to pay. When you hand over cash and get change, you are better able to remember how much you’ve spent for each and every purchase.
Withdraw Cash Wednesday encourages people to withdraw the cash they are going to spend for the week from ATMs on Wednesdays to discourage unnecessary spending with plastic cards. You’ll benefit from the responsible spending and savings practices that go along with using cash, and be better able to stick to your budget.
No pain, no gain. Join the Withdraw Cash Wednesday movement today and get started using cash to save money