I got a credit card in high school because one of my friends told me that I should start working on my credit rating before I left home for college.  She was right, although maybe ahead of her time.  Actually getting the credit card gave me the opportunity to make up for the somewhat inadequate student loans that I was offered by putting my extra expenses on my credit card.  I hadn’t learned much about budgeting back then, although I did  relatively well, I did go into all kinds of different debt.

When I got out of school, I remained broke.  When it was time to start paying off my student loans, I was still broke.

By that time, I had figured out that I was much less likely to spend by not using a bank account and by not using a credit card.  It was the first time that I chose paper over plastic.  Rather than depositing my money and removing it slowly with a debit card, I cashed my check every month and budgeted that way. I found (and still find) that I am much less likely to spend if I am handing over bills than if I use a debit or credit card AND that I was much less likely to stay on a budget if I had a physical stash that I was using to monitor myself.

This is not really a groundbreaking discovery, but instead something that has been understood for quite some time.  A 2008 NPR story reports that this is psychologically rooted in that there is a difference in feeling between actually spending the money versus agreeing to pay the money at a future time.  It notes that the average spending at McDonald’s goes up from $4.50 with cash to $7.00 with credit.

Using cash only also supports my aesthetic and political sensibilities. I appreciate the added benefits of keeping my money local and under the radar.

More recently, I had some experience with bartering. It was a great way to practice massage without simply giving bodywork away. Barter served to build up my reputation, client and referral base. But the more skilled and busy that I have become, I have been less willing to barter. Sometimes, it ended up feeling like an unequal trade andother times it has created scheduling or tracking difficulties and stress.  I also ended up consuming many more services than I would normally, getting my hair done frequently and receiving private pilates instruction (although I do miss these things, they are just more extravagant than my budget actually allows.  I am at the point, where it is worth it to pay people for their work and for me to get paid for mine.  I have my schedule clear for paying clients and I can schedule with any provider that I want without dealing with feelings of obligation or micro-managing the relationship. It was as if I rediscovered the idea of money. It was invented for sensible reasons, but I know all about where good intentions lead…