July 29, 2025 • 24 mins
Cash is nowhere near as popular as it once was. But before you go completely cashless, there are a few benefits to still embracing notes and coins. Join Canna Campbell - a financial planner for 20 years - and Fear & Greed's Michael Thompson as they look at the benefits and risks of going cashless, and why cash envelopes can still work as a budgeting system.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
Welcome to How Do They Afford That? The podcast that
peeks into the financial lives of everyday Australians. I'm Michael Thompson.
I'm the author of two novels like How I Dropped
That In There? Now Cannah and the co host of
the podcast Fear and Greed. Business news As always, I'm
with Canna Campbell, financial planner, founder of Sugar Mama TV,
the financial literacy platform covering YouTube podcasts, books, Instagram threads,
(00:23):
TikTok and more. Hello, good morning, how are you? I
am well, and I am looking forward to today's episode
because it's it's something that I've been noticing for a
while and it's a bit of a it's a bit
of a mystery.
Speaker 2 (00:37):
Really.
Speaker 1 (00:38):
We're going to talk about cash. Okay, cash It was
once king, Cash is king, right, and I just don't
know whether it is anymore.
Speaker 2 (00:46):
I feel like it's made a little bit come back.
Speaker 1 (00:48):
Oh really, Well, the thing is it's nowhere near as
popular as it was previously. So fifteen overall, right, fifteen
twenty years ago, the stats show that almost seventy percent
of transactions in Australia used cash. Seventy percent wow, which
I was surprised by that. Then in twenty twenty two,
(01:09):
so you fast forward, it had gone from seventy percent
down to thirteen percent of transactions in Australia used cash
has probably gotten lower since then, because that was a
few years ago. Now it's gotten so unpopular really that
the government has announced the businesses selling essential goods and services.
(01:29):
So I think kind of supermarkets and the like will
actually be forced to keep accepting cash because chances are
those businesses don't actually want to accept it anymore. So
my question for you today, kind of after that lengthy
preamble filled with my own opinion, why not just go cashless?
(01:50):
Because in our household we don't we really don't use cash.
Is there a disadvantage to not having cash? Is it
bad for the budget to be cash free? Is it
harder to teach your kids about money if you're not
using cash? Do we lose track of our finances? It?
There's a lot to unpack here, Yeah, I know, and
I'm just piling it up. Is going cashless in your
(02:13):
household a bad idea? Kind of Why have we moved
away so much from cash? Is it just because it's dirty?
Speaker 2 (02:23):
Look, I think COVID was the biggest catalyst moving away
from cash. We became so much more aware of all
the gems and bacteria and you know, all those distancing
contactless rules and a lot of us obviously when with
the lockdowns we were forced to do all of our
shopping online. But then so well, since then, there's also
been obviously advancements and technology with tap and go, you know,
(02:46):
with our phones, our watches and you know, digital wallets.
Like I think when I walk out the door most
of the time, I just don't even take a wallet,
I just take my phone and slip it in my pocket.
And then obviously things like loyalty programs, you know, all
again saved on your phone, digital seats, even your tickets
to concerts and movies that they're all like now on
our phone, there's not really as much need.
Speaker 1 (03:07):
So it's a combination of things. Then that in that
it was both the physical side of it. With COVID,
there was really no one wanted to be using cash,
touching cash, exchanging it because we weren't seeing other people
and there was just this real aversion to anything that
could be carrying any kind of infection. But at the
same time, technology has increased and developed to the point
(03:29):
where payment options are so good that it's maybe not necessary.
Speaker 2 (03:34):
And I'd also say there's a bit of a social
lifestyle trend, you know you I mean, I awkwardly went
to Yochi the other day for a play date and
left my phone at home, and you know, but when
I got home, I was able to pay with Thissu's
mobile phone numbers. So you know, there's it's become more fashionable.
And also it's incredibly efficient and convenient.
Speaker 1 (03:54):
To be cashless. Just a quick question, what did you
say you went to yo Chi?
Speaker 2 (03:59):
Don't go to yo Chi because it's where all your
rent money and mortgage payment's got to die.
Speaker 1 (04:04):
Yo Chi yo Chi?
Speaker 2 (04:05):
What is that? It is essentially imagine Sizzler back in
the day. Did you go to Sizzla?
Speaker 1 (04:10):
Did I go to Sisla? I went to Sizzler for
my thirtieth birthday, right, I dragged a whole bunch of
people a lot. No, because I'm like, you know what,
there are very few Sizzlers left. Like, so this is
a decade ago.
Speaker 2 (04:22):
Now I'm stop going to Sisla.
Speaker 1 (04:23):
When I was thirteen, well, I wanted to relive the
glory days of Sisler and Unfortunately, the glory days were
well passed it at that point that we went for
my thirtieth. But yes, I remember Sizla well and the
cheese oh yeah, and the dessert bar.
Speaker 2 (04:38):
So that's like yo chi but with frozen yogurt, so
you you know, get to pour your own frozen yogurt,
and there's like the original tart is my personal favorite,
I highly recommend. But then there probably be maybe forty
different flavors of toppings from mini like Mochi's to corn
flakes to cheesecake. It's insane, and then biscof and pistachio
(05:01):
cream and tell her, okay, but that's why it is.
You literally go in there and walk out seventy dollars later.
Speaker 1 (05:07):
Who was putting conflicts on frozen yoga?
Speaker 2 (05:11):
Don't knock it till you try it, Honestly, I want
I insist that you can miss it yog and okay,
report back, all right, just go alone, otherwise it will
be painfully very expensive.
Speaker 1 (05:23):
Okay, all right, So do you use it? Do you
use cash? I mean, if we can put the frozen
yogurt to one side for a minute, do you ever
actually use it now in your own life?
Speaker 2 (05:35):
Yes? Interesting you say that because previously no, not at all.
But with the rising cost of living and you know,
budgets being so tight, Tom and I have agreed that
with our own separate sanity money that we each get,
that's the equal amount we give it to each other
in cash, So that money I get, Tom gets his,
and I can use that money to pay for coffees
(05:56):
or if I want to get a haircut, or if
I want to get my nails done or massage, I
pay for that out of my own cash. And I
actually really quite like having that cash around me. It
kind of feels a little bit boogie. There's a bit
of I don't know, there's something a nice energy about it.
And Tom has that, you know, if he's getting clients
and stuff coffees, he just likes to have it then
(06:17):
for comfort.
Speaker 1 (06:18):
It's a good backup. I actually have my wallet here.
I never carry my wallet, but I found it in
my bag here when I walked into the studio, and
I am going to check to see whether I have
this is this goes to show how cashless we have become.
I do not remember the list.
Speaker 2 (06:34):
That's a brick, that's not a wallet.
Speaker 1 (06:37):
I mean, I don't actually remember the last time I
opened this thing. Because you don't use physical cards anymore,
you don't use anything within this I don't even show
my driver's license because that's on an app. Now I'm
going to see if there's any cash in there, because
this is how little cash I have actually used. Well,
that part's not looking good. The moths are flying out
(06:59):
of that part, and oh look at that. Oh you're
rich ten dollars around ten bucks. But I mean, I
did not know that was even in there. It has
been that long since I used cash. Is there a
risk in what I'm doing? Is there a risk in
going so cashless that that financially I am going to
lose track of where I'm up to?
Speaker 2 (07:21):
I do think so, you know, I think you can
very easily overspend. I think you can impulse purchase because
you know, especially online shopping and buy an hour, pay later.
Is also someone like yourself that has twenty something different
bank accounts. It's really hard to stay on top of
the digital trail if you're trying to do a budget
(07:43):
and stick to it. So that can make it really
hard to stick to that budget.
Speaker 1 (07:46):
Harder though, to keep on track of the cash trail,
right because if you've spent money here and there, unless
you've actually said, hey, can I have a receipt for that,
you're not going to know where that was.
Speaker 2 (07:57):
Well, this is the thing, is I believe when you're
using money. There are lots of studies around this, but
it actually physically hurts to use money. It's physical cash.
Speaker 1 (08:06):
Yeah, that's the pain of paying theory, right, breaking that one.
Speaker 2 (08:10):
Hundred dollar note, like you know, you think, oh, you
know what, I'll skip that coffe because I don't want
break this fifty or so.
Speaker 1 (08:15):
It's less about the tracking of it and more about
the almost the psychological element of having to hand it
over knowing that you're going to get back less money
than you hand it over, whereas you do not think
about that when you're just tapping.
Speaker 2 (08:27):
And I think also, you know, when we if we
were to go completely cash less, that you know, we're
starting to exclude some important people within our society, like
you know, the elderly, are the homeless, they don't have
digital wallets, low income earners, people who you know don't
have a bank account for whatever reason. You know, I
don't think we can go completely cashless. We're not. We're
(08:49):
not there yet.
Speaker 1 (08:51):
Well, That was actually going to be my next question
for you, as in who benefits from using cash? What
types of people, what types of households. But really, I
mean the elderly is for me, is the one where
and you often hear stories of older people going and
withdrawing large sums and that's then their money for the
(09:12):
next couple of couple of weeks.
Speaker 2 (09:14):
They're the grandparents that put the twenty dollars node in
the birthday card, and that's something really special. I think
about that, and I think we need to respect and
honor that need.
Speaker 1 (09:24):
Okay, who benefits, Sorry just to cut you off, but
that's fine.
Speaker 2 (09:29):
Look anyone that's on a tight budget, I think having
cash can be really powerful because it puts you back
in the driving seat and you know that that's what
you've got, you've got to make it last, and you're
a lot more attentive and mindful when you are actually
using it. It can be very helpful for people who
are drowning in debt and really need to do the
deep work to look at how they spend money, and
(09:52):
having that cash you can actually help them eventually pay
that debt down. Then I'd also say people you know
who've got maybe impulsive spend behaviors where they just tend
to just burn through money quite quickly. Having that awareness
of cash can actually stop them because they actually physically
see the exchange of values when they're using that cash,
rather than tapping away. Because that's when you tap and
(10:14):
wave your card is pretty mindless. You don't actually physically
think and go, my bank account's going to drop by
one hundred and fifty nine dollars, Whereas when you're hanging
over a hundred dollars note, a fifty dollar note and
some coins to make up that amount, you're a lot
more aware. Sometimes, I would say children and teenagers who
are trying to learn about financial literacy. However, in my household,
(10:36):
I'm actually trying to teach my kids how to navigate
a cashlest society, which I guess we can come to.
Speaker 1 (10:41):
Yeah, I will ask you about that, because it kind
of feels like you may as well prepare kids for
the world they're going into.
Speaker 2 (10:47):
Right exactly, That's exactly my point, And people get quite
shocked when I say, you know, no, we don't have
jars and piggybanks and stuff like that in my home.
Speaker 1 (10:55):
In the second part of the episode, because we'll take
a break shortly, but I do want to talk to
you about some of the benefits of still using cash
and some budgeting systems as well, because I know that
there are some systems, and you talked about potentially low
income households for instance. Yeah, people in debt that might
actually benefit from using cash almost as a way of budgeting,
(11:16):
and a couple of ways to organize that. So we'll
get to that in a sec but just quickly spending categories,
I suppose we'll call them where using cash still makes
sense for me. I can't think of any because everything
I do is just either a direct debit transfer or
(11:37):
a tap and go. Where does it still benefit yourself
or the vendor if you're using cash.
Speaker 2 (11:47):
Well, not necessarily vendor, but of course will include them.
But the first thing off my mind is babysitters.
Speaker 1 (11:54):
Okay, they want to be.
Speaker 2 (11:55):
Paid the time moment you get home, and it's great
to pay them in cash. Also, you know someone who
maybe comes around, like I have a handyman that comes
around every now and again to break all the thing
fix all the things my kids and Tom have broken,
and I like to pay him cash and he really
appreciates it. As well, and often when I say can
I give you cash, he just knocks a little bit
off as well because he's grateful. Then obviously, you know,
(12:16):
going to the local markets, you know, if you're going
to buy some fruit and vegetables, or you're buying arts
and crafts, you know, as I said, that personal discretionary spending.
So you know, if I get my nails done, they
you know, say how would you like to pay? And
you know if I pay cash, they'll knock five dollars
off the bills. Obviously they're saving in the transaction costs.
And also I've noticed a lot of places, particularly cafes,
(12:39):
I'll actually have a sign that says, you know, we'd
appreciate if you can pay in cash as.
Speaker 1 (12:42):
Well, without meaning to be too negative or I'll just
be a devil's advocate on this. How much of this, though,
is people trying to dodge tax Yeah, essentially, And when
you give the examples of say, cafes that would prefer cash,
how much of that is not perhaps being reported or
perhaps in the cash economy within the within trades as well.
(13:07):
It is, It is an issue.
Speaker 2 (13:09):
It is, But also the ato are not stupid, Yeah,
they understand that you know, a cafe could be a
cash business, just like the dry cleaners also could be,
you know, a cash business. So and you know, it's
funny you say. The other day I was chatting to
an accountant and they said, AI is quite incredible. You
know that they can pick up so much now as
to who is laundering money. He's not probably declaring their income.
(13:30):
And I do to the cafe's credit when I pay cash.
I still watch them registered on the you know, the
cash registers.
Speaker 1 (13:37):
You can still get a receipt exactly.
Speaker 2 (13:38):
And I don't think i've ever actually not seen someone
properly logic because at the end of the day, the
employee's got to put what's going on in the till
to make sure it's balances, and there's the floats still
at the end of the day. So I think you are, yeah,
he's up, buddy. Okay, it's all businesses out there. They're
not trying to like I know, but under they're taxes.
Speaker 1 (13:57):
The ATO has been very clear in the past about
cracking down on the cash economy and on things that
are not being declared. So I think if you don't
want to be part of that, then you just make
sure that whatever you're doing, even if you're paying cash,
that you are able to get a receipt for it,
Because if you're able to get a receipt for it,
then it is going through the books.
Speaker 2 (14:12):
Yes, all right, fair enough.
Speaker 1 (14:16):
It kind of took us off in an odd direction there.
I've come into the studio of it fiery today.
Speaker 2 (14:21):
Sorry, I'm the compassionate, empathetic one.
Speaker 1 (14:24):
Yeah, no, that's okay. It's the clash of personalities that
makes this podcast a hit.
Speaker 2 (14:30):
But do you know, to your credit, it's just it's
like speeding, you know, is there only amount of time before.
Speaker 1 (14:36):
You get caught.
Speaker 2 (14:36):
And if you get caught, the ATF coup would go
back many, many years and you could be up for
fines and penalties and a whole pile of headaches.
Speaker 1 (14:44):
That sounds intense. Okay, quick break. When we come back,
we're going to talk about budgeting using cash, the JAR systems,
the cash envelope system. It's very exciting. We'll be back
in a second, all right. Can we are talking about cash?
(15:05):
Is cash or cash less best for the budget? We
talked a bit about whether using cards and apps and
things about whether it makes it easier or harder to
track your spending or whether it's easier to overspend. And yes,
I think we've established that if you're just tapping and going,
it is probably easier to overspend because you don't have
that pain of paying of handing over the cash. Does
(15:30):
then can we assume from that then that using cash
would help you stick to a budget better than using
cards or digital wallets.
Speaker 2 (15:38):
Yes, And I think it would actually slow down that
consumption as well.
Speaker 1 (15:41):
Yeah, it makes everything more inconvenient.
Speaker 2 (15:44):
Yeah, and got to ration that money out. Yeah, for
the pay cycle.
Speaker 1 (15:49):
Can you imagine turning up at school or something to
pay like kids, like an excursion or something, and turning
up with cash.
Speaker 2 (15:56):
Well, when I get an invoice from my son's school,
which is just a local public school, it actually says,
if you'd like to come and play cash, you Canada
Front counter.
Speaker 1 (16:04):
Well, I remember when you're in primary school and you'd
go to school with a little envelope with coins and
stuff in it to pay for whatever it was an
excursion or something. It costs like two dollars or something.
I imagine, But I mean cash was everywhere and that
was completely normal. It is completely flipped on its head, now,
what know? Yeah, I feel like I'm much more passionate
(16:26):
about this than you are.
Speaker 2 (16:27):
But also you remember, like I am in the process
of decluttering a whole pile of stuff, and some of
this stuff will go on like gum Tree and Facebook Marketplace,
where you know people may turn up paying thing for
things in cash, So it does sit in our economy.
Speaker 1 (16:43):
Can I have a little vent about how much I
am frustrated by Facebook, Marketplace and other things?
Speaker 2 (16:48):
Why not?
Speaker 1 (16:48):
Yeah? About everything else it is? It feels like now
we reached a point where unless you're selling something that
is worth say hundred dollars for instance, that it's not
worth your time. That goes into it because if you
have something up there for ten dollars and you get
thirty inquiries, all going hi, is this still available, and
(17:11):
you're right back, yes it is, and then half of
them won't respond. A couple of them will ask you
can you move on the price? A couple will ask
where it is and like it's in the ad? Read
the ad. Don't you find that it almost is better
to just say, hey, this is free, donate it to Vinnie's,
donated to the Salvos, and it gets it out of
your house. It goes to a good cause and you
(17:33):
don't have that drain on your time and your resources.
So I'm very angry.
Speaker 2 (17:37):
Clearly you've not done your research. Don't you see people
who have in the top of listing their ad like
the description says, if it is still up here, it
is still available.
Speaker 1 (17:48):
No one pays any attention to that.
Speaker 2 (17:50):
Well I do, because I am quite the Facebook marketplace consumer.
Oh okay, fine, and those things I paid for it
in cash.
Speaker 1 (17:57):
Well, I'm only going to sell to you from now.
Speaker 2 (18:01):
I do not want your junk.
Speaker 1 (18:02):
It's not junkets, quality stuff. Cash budgeting, the cash envelopes
or the jar systems, do they have a place in
modern budgeting? How do they actually work?
Speaker 2 (18:13):
I definitely think they do, and I used to when
I was a single mother on a tight, tight budget.
I had the envelope system going myself for certain expenses,
particularly like special expenses like getting my hair done, and
every week I'd put twenty dollars in an envelope, which
I had it written on the envelope, you know, hair
card or hair color, so that you know when it
came time for me getting my hair done, I had
(18:36):
the cash ready to go, and I can actually pay
my hairdresser cash as well. So it's the jar system
and the envelope system. Very simple. You just put in
a certain amount of money, typically on a consistent basis,
and the same amount and watch a pile up so
that when that expense comes around, you've got the money
ready to go and you're not dipping into buy now,
pay later or using credit cards. You know, you're a
(18:59):
lot more in control, and I think it teaches some
really healthy habits. And as I said, when you use
cash you tend to slow down your consumption. I think
that awareness actually stays with you for quite some time.
Speaker 1 (19:12):
Okay, So you have a whole stack of envelopes, or
a whole stack of jars, one for rent, one for groceries,
one for medical, all those kinds of things, and you
just when you get paid, you get it in cash
and you divvy it up between those and that's okay.
So it is essentially just similar to the budgeting systems
that we've talked about in the past, where you might
(19:32):
have a couple of different accounts set aside for different things.
You are just doing it in cash so that you
can tap into that pain of paying, the slowing down
of the spending and really that assessment of do I
really need this before I hand over the cash.
Speaker 2 (19:45):
And I think the dopamine hit of seeing that cash
in those envelopes or the gold coins in that jar
are really exciting. You actually do want to keep going,
and you respect the system and how it's supporting you,
and you know your financial journey.
Speaker 1 (19:57):
And I suppose that would be helpful and for kids
to see that kind of thing as well, because it's
hard to talk children through at an online budget system,
whereas you can that's a very physical, practical demonstration to
show them jars, to show them envelopes, and to show
them that money building up and what it's been allocated to.
Speaker 2 (20:17):
So with Rocco, I initially did cash, and he had
his little piggy bank and we had money in that,
but obviously COVID came around and that sort of all
went out the window, and I now don't do cash
around my kids. The only thing Rocco will get is
a couple of coins at the on a Friday to
get some lollies after school, and that's really that's the
entime he gets cash. But I am teaching him, maybe
(20:37):
from an ediqua point of view, you know, for example,
if he has to you know, he's got a bike
and he can earn pocket money and things like that.
So if I'm running out of milk, for example, you
know he can. I'll give him some cash and he'll
go to the shops by and I'll like, let I'll
explain to him, Okay, this is how you check the
most cost effective milk and give it a bit, make
it a bit of a I guess, a comprehensive exercise
(20:59):
with money and the etiquette of coming home with the change,
but also with the receipt. Just polite money management and
the importance of being really transparent communicating this cost this much.
I chose this brand of that bank. Is that's on
special Like it's that he's actually learning a lot and
gives me now lect just won't go to the supermarket.
Speaker 1 (21:18):
I love the fact that you are teaching him to
ask for a receipt. This is kind of music to
my ears.
Speaker 2 (21:23):
I think it's really polite. If someone says, do you
mind grabbing me something like, you just let them know
I'm not trying to if it's a bit more expensive
of what found. It just makes it really transparent. This
is how much the milk cost. If you think that
was a bit more expensive, I'm not stealing from you.
Here's the evidence, and it just I think it's a
form of protection. And that's where I explained to Rocker.
Speaker 1 (21:40):
To make sure the money's not going into the cash economy.
The one type of person that we haven't mentioned yet
that uses cash are the cash hoarders, right, And we
see a lot of stories about the number of banknotes
that are out in circulation at the moment in Australia,
(22:02):
and there is so much There is so much cash
out there even though I'm not using it, You're not
using it a huge amount, right, Yet there is more
cash out there than ever before. It is tucked away
under mattresses.
Speaker 2 (22:19):
It is kind of you know, criminal activity perhaps.
Speaker 1 (22:24):
Ah, yes, potentially dealers. Does it ever make you worry though,
when you hear stories about people hoarding their money because
I don't trust the banking system and you're like, you're
missing out on compound interest.
Speaker 2 (22:34):
It makes me really sad that they have that complete
lack of trust and faith in the system. And you know,
of course the obvious is they're missing out on interest.
But even worse if they get robbed that money is gone.
They can't claim.
Speaker 1 (22:48):
On no proof of it. Yeah, okay, finishing with one
question for you, and you have to give me a
definitive answer. You may not sit on the fence on
this one. What is better for the budget? Cash or cashless?
Speaker 2 (23:04):
Cash? Oh? Oh wow, it is quite Try it for
a week. It's going to be annoying as an extra
adminute involved carrying cash. And also people will get pushed
back from you. You know, you have to pay for
something and they don't have the right exact amount of change.
That's going to irritate some people. But it's amazing how
much more aware of your spending habits and how much
(23:28):
over consumption happens in our lives that we have absolutely
no idea of, and then we wonder where all our
money has gone. I think cash is very powerful and
it's something I would recommend for anyone, as I said,
who's drowning in debt and is on a debt free
journey and really needs to do that insightful work where
they look at the way that they're literally burning cash.
Speaker 1 (23:51):
I want to do this a one week cash trial.
Speaker 2 (23:54):
Can I add one little tip though as well? Okay
for those of you who are on that debt Free
journe and cannot fathom the idea of money for whatever reason,
maybe it's dirty or it's just an inconvenience. Can I
recommend that they check their bank accounts every morning and
night so that you have that complete awareness as to
when you are tapping the impact in watching your bank
(24:16):
balance regularly drop. That's really important. Okay.
Speaker 1 (24:21):
If we want to find more information from you, where.
Speaker 2 (24:24):
Do we reach you? Best place to get in contact
with me is on Instagram at Sugar mam My tv.
Speaker 1 (24:29):
Okay, and you can hear me every day with Sean
Aylmer on Fear and Greed business News. You can use.
Thank you very much for listening to how do they
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Welcome to How Do They Afford That? The podcast that
peeks into the financial lives of everyday Australians. I'm Michael Thompson.
I'm the author of two novels like How I Dropped
That In There? Now Cannah and the co host of
the podcast Fear and Greed. Business news As always, I'm
with Canna Campbell, financial planner, founder of Sugar Mama TV,
the financial literacy platform covering YouTube podcasts, books, Instagram threads,
(00:23):
TikTok and more. Hello, good morning, how are you? I
am well, and I am looking forward to today's episode
because it's it's something that I've been noticing for a
while and it's a bit of a it's a bit
of a mystery.
Speaker 2 (00:37):
Really.
Speaker 1 (00:38):
We're going to talk about cash. Okay, cash It was
once king, Cash is king, right, and I just don't
know whether it is anymore.
Speaker 2 (00:46):
I feel like it's made a little bit come back.
Speaker 1 (00:48):
Oh really, Well, the thing is it's nowhere near as
popular as it was previously. So fifteen overall, right, fifteen
twenty years ago, the stats show that almost seventy percent
of transactions in Australia used cash. Seventy percent wow, which
I was surprised by that. Then in twenty twenty two,
(01:09):
so you fast forward, it had gone from seventy percent
down to thirteen percent of transactions in Australia used cash
has probably gotten lower since then, because that was a
few years ago. Now it's gotten so unpopular really that
the government has announced the businesses selling essential goods and services.
(01:29):
So I think kind of supermarkets and the like will
actually be forced to keep accepting cash because chances are
those businesses don't actually want to accept it anymore. So
my question for you today, kind of after that lengthy
preamble filled with my own opinion, why not just go cashless?
(01:50):
Because in our household we don't we really don't use cash.
Is there a disadvantage to not having cash? Is it
bad for the budget to be cash free? Is it
harder to teach your kids about money if you're not
using cash? Do we lose track of our finances? It?
There's a lot to unpack here, Yeah, I know, and
I'm just piling it up. Is going cashless in your
(02:13):
household a bad idea? Kind of Why have we moved
away so much from cash? Is it just because it's dirty?
Speaker 2 (02:23):
Look, I think COVID was the biggest catalyst moving away
from cash. We became so much more aware of all
the gems and bacteria and you know, all those distancing
contactless rules and a lot of us obviously when with
the lockdowns we were forced to do all of our
shopping online. But then so well, since then, there's also
been obviously advancements and technology with tap and go, you know,
(02:46):
with our phones, our watches and you know, digital wallets.
Like I think when I walk out the door most
of the time, I just don't even take a wallet,
I just take my phone and slip it in my pocket.
And then obviously things like loyalty programs, you know, all
again saved on your phone, digital seats, even your tickets
to concerts and movies that they're all like now on
our phone, there's not really as much need.
Speaker 1 (03:07):
So it's a combination of things. Then that in that
it was both the physical side of it. With COVID,
there was really no one wanted to be using cash,
touching cash, exchanging it because we weren't seeing other people
and there was just this real aversion to anything that
could be carrying any kind of infection. But at the
same time, technology has increased and developed to the point
(03:29):
where payment options are so good that it's maybe not necessary.
Speaker 2 (03:34):
And I'd also say there's a bit of a social
lifestyle trend, you know you I mean, I awkwardly went
to Yochi the other day for a play date and
left my phone at home, and you know, but when
I got home, I was able to pay with Thissu's
mobile phone numbers. So you know, there's it's become more fashionable.
And also it's incredibly efficient and convenient.
Speaker 1 (03:54):
To be cashless. Just a quick question, what did you
say you went to yo Chi?
Speaker 2 (03:59):
Don't go to yo Chi because it's where all your
rent money and mortgage payment's got to die.
Speaker 1 (04:04):
Yo Chi yo Chi?
Speaker 2 (04:05):
What is that? It is essentially imagine Sizzler back in
the day. Did you go to Sizzla?
Speaker 1 (04:10):
Did I go to Sisla? I went to Sizzler for
my thirtieth birthday, right, I dragged a whole bunch of
people a lot. No, because I'm like, you know what,
there are very few Sizzlers left. Like, so this is
a decade ago.
Speaker 2 (04:22):
Now I'm stop going to Sisla.
Speaker 1 (04:23):
When I was thirteen, well, I wanted to relive the
glory days of Sisler and Unfortunately, the glory days were
well passed it at that point that we went for
my thirtieth. But yes, I remember Sizla well and the
cheese oh yeah, and the dessert bar.
Speaker 2 (04:38):
So that's like yo chi but with frozen yogurt, so
you you know, get to pour your own frozen yogurt,
and there's like the original tart is my personal favorite,
I highly recommend. But then there probably be maybe forty
different flavors of toppings from mini like Mochi's to corn
flakes to cheesecake. It's insane, and then biscof and pistachio
(05:01):
cream and tell her, okay, but that's why it is.
You literally go in there and walk out seventy dollars later.
Speaker 1 (05:07):
Who was putting conflicts on frozen yoga?
Speaker 2 (05:11):
Don't knock it till you try it, Honestly, I want
I insist that you can miss it yog and okay,
report back, all right, just go alone, otherwise it will
be painfully very expensive.
Speaker 1 (05:23):
Okay, all right, So do you use it? Do you
use cash? I mean, if we can put the frozen
yogurt to one side for a minute, do you ever
actually use it now in your own life?
Speaker 2 (05:35):
Yes? Interesting you say that because previously no, not at all.
But with the rising cost of living and you know,
budgets being so tight, Tom and I have agreed that
with our own separate sanity money that we each get,
that's the equal amount we give it to each other
in cash, So that money I get, Tom gets his,
and I can use that money to pay for coffees
(05:56):
or if I want to get a haircut, or if
I want to get my nails done or massage, I
pay for that out of my own cash. And I
actually really quite like having that cash around me. It
kind of feels a little bit boogie. There's a bit
of I don't know, there's something a nice energy about it.
And Tom has that, you know, if he's getting clients
and stuff coffees, he just likes to have it then
(06:17):
for comfort.
Speaker 1 (06:18):
It's a good backup. I actually have my wallet here.
I never carry my wallet, but I found it in
my bag here when I walked into the studio, and
I am going to check to see whether I have
this is this goes to show how cashless we have become.
I do not remember the list.
Speaker 2 (06:34):
That's a brick, that's not a wallet.
Speaker 1 (06:37):
I mean, I don't actually remember the last time I
opened this thing. Because you don't use physical cards anymore,
you don't use anything within this I don't even show
my driver's license because that's on an app. Now I'm
going to see if there's any cash in there, because
this is how little cash I have actually used. Well,
that part's not looking good. The moths are flying out
(06:59):
of that part, and oh look at that. Oh you're
rich ten dollars around ten bucks. But I mean, I
did not know that was even in there. It has
been that long since I used cash. Is there a
risk in what I'm doing? Is there a risk in
going so cashless that that financially I am going to
lose track of where I'm up to?
Speaker 2 (07:21):
I do think so, you know, I think you can
very easily overspend. I think you can impulse purchase because
you know, especially online shopping and buy an hour, pay later.
Is also someone like yourself that has twenty something different
bank accounts. It's really hard to stay on top of
the digital trail if you're trying to do a budget
(07:43):
and stick to it. So that can make it really
hard to stick to that budget.
Speaker 1 (07:46):
Harder though, to keep on track of the cash trail,
right because if you've spent money here and there, unless
you've actually said, hey, can I have a receipt for that,
you're not going to know where that was.
Speaker 2 (07:57):
Well, this is the thing, is I believe when you're
using money. There are lots of studies around this, but
it actually physically hurts to use money. It's physical cash.
Speaker 1 (08:06):
Yeah, that's the pain of paying theory, right, breaking that one.
Speaker 2 (08:10):
Hundred dollar note, like you know, you think, oh, you
know what, I'll skip that coffe because I don't want
break this fifty or so.
Speaker 1 (08:15):
It's less about the tracking of it and more about
the almost the psychological element of having to hand it
over knowing that you're going to get back less money
than you hand it over, whereas you do not think
about that when you're just tapping.
Speaker 2 (08:27):
And I think also, you know, when we if we
were to go completely cash less, that you know, we're
starting to exclude some important people within our society, like
you know, the elderly, are the homeless, they don't have
digital wallets, low income earners, people who you know don't
have a bank account for whatever reason. You know, I
don't think we can go completely cashless. We're not. We're
(08:49):
not there yet.
Speaker 1 (08:51):
Well, That was actually going to be my next question
for you, as in who benefits from using cash? What
types of people, what types of households. But really, I
mean the elderly is for me, is the one where
and you often hear stories of older people going and
withdrawing large sums and that's then their money for the
(09:12):
next couple of couple of weeks.
Speaker 2 (09:14):
They're the grandparents that put the twenty dollars node in
the birthday card, and that's something really special. I think
about that, and I think we need to respect and
honor that need.
Speaker 1 (09:24):
Okay, who benefits, Sorry just to cut you off, but
that's fine.
Speaker 2 (09:29):
Look anyone that's on a tight budget, I think having
cash can be really powerful because it puts you back
in the driving seat and you know that that's what
you've got, you've got to make it last, and you're
a lot more attentive and mindful when you are actually
using it. It can be very helpful for people who
are drowning in debt and really need to do the
deep work to look at how they spend money, and
(09:52):
having that cash you can actually help them eventually pay
that debt down. Then I'd also say people you know
who've got maybe impulsive spend behaviors where they just tend
to just burn through money quite quickly. Having that awareness
of cash can actually stop them because they actually physically
see the exchange of values when they're using that cash,
rather than tapping away. Because that's when you tap and
(10:14):
wave your card is pretty mindless. You don't actually physically
think and go, my bank account's going to drop by
one hundred and fifty nine dollars, Whereas when you're hanging
over a hundred dollars note, a fifty dollar note and
some coins to make up that amount, you're a lot
more aware. Sometimes, I would say children and teenagers who
are trying to learn about financial literacy. However, in my household,
(10:36):
I'm actually trying to teach my kids how to navigate
a cashlest society, which I guess we can come to.
Speaker 1 (10:41):
Yeah, I will ask you about that, because it kind
of feels like you may as well prepare kids for
the world they're going into.
Speaker 2 (10:47):
Right exactly, That's exactly my point, And people get quite
shocked when I say, you know, no, we don't have
jars and piggybanks and stuff like that in my home.
Speaker 1 (10:55):
In the second part of the episode, because we'll take
a break shortly, but I do want to talk to
you about some of the benefits of still using cash
and some budgeting systems as well, because I know that
there are some systems, and you talked about potentially low
income households for instance. Yeah, people in debt that might
actually benefit from using cash almost as a way of budgeting,
(11:16):
and a couple of ways to organize that. So we'll
get to that in a sec but just quickly spending categories,
I suppose we'll call them where using cash still makes
sense for me. I can't think of any because everything
I do is just either a direct debit transfer or
(11:37):
a tap and go. Where does it still benefit yourself
or the vendor if you're using cash.
Speaker 2 (11:47):
Well, not necessarily vendor, but of course will include them.
But the first thing off my mind is babysitters.
Speaker 1 (11:54):
Okay, they want to be.
Speaker 2 (11:55):
Paid the time moment you get home, and it's great
to pay them in cash. Also, you know someone who
maybe comes around, like I have a handyman that comes
around every now and again to break all the thing
fix all the things my kids and Tom have broken,
and I like to pay him cash and he really
appreciates it. As well, and often when I say can
I give you cash, he just knocks a little bit
off as well because he's grateful. Then obviously, you know,
(12:16):
going to the local markets, you know, if you're going
to buy some fruit and vegetables, or you're buying arts
and crafts, you know, as I said, that personal discretionary spending.
So you know, if I get my nails done, they
you know, say how would you like to pay? And
you know if I pay cash, they'll knock five dollars
off the bills. Obviously they're saving in the transaction costs.
And also I've noticed a lot of places, particularly cafes,
(12:39):
I'll actually have a sign that says, you know, we'd
appreciate if you can pay in cash as.
Speaker 1 (12:42):
Well, without meaning to be too negative or I'll just
be a devil's advocate on this. How much of this, though,
is people trying to dodge tax Yeah, essentially, And when
you give the examples of say, cafes that would prefer cash,
how much of that is not perhaps being reported or
perhaps in the cash economy within the within trades as well.
(13:07):
It is, It is an issue.
Speaker 2 (13:09):
It is, But also the ato are not stupid, Yeah,
they understand that you know, a cafe could be a
cash business, just like the dry cleaners also could be,
you know, a cash business. So and you know, it's
funny you say. The other day I was chatting to
an accountant and they said, AI is quite incredible. You
know that they can pick up so much now as
to who is laundering money. He's not probably declaring their income.
(13:30):
And I do to the cafe's credit when I pay cash.
I still watch them registered on the you know, the
cash registers.
Speaker 1 (13:37):
You can still get a receipt exactly.
Speaker 2 (13:38):
And I don't think i've ever actually not seen someone
properly logic because at the end of the day, the
employee's got to put what's going on in the till
to make sure it's balances, and there's the floats still
at the end of the day. So I think you are, yeah,
he's up, buddy. Okay, it's all businesses out there. They're
not trying to like I know, but under they're taxes.
Speaker 1 (13:57):
The ATO has been very clear in the past about
cracking down on the cash economy and on things that
are not being declared. So I think if you don't
want to be part of that, then you just make
sure that whatever you're doing, even if you're paying cash,
that you are able to get a receipt for it,
Because if you're able to get a receipt for it,
then it is going through the books.
Speaker 2 (14:12):
Yes, all right, fair enough.
Speaker 1 (14:16):
It kind of took us off in an odd direction there.
I've come into the studio of it fiery today.
Speaker 2 (14:21):
Sorry, I'm the compassionate, empathetic one.
Speaker 1 (14:24):
Yeah, no, that's okay. It's the clash of personalities that
makes this podcast a hit.
Speaker 2 (14:30):
But do you know, to your credit, it's just it's
like speeding, you know, is there only amount of time before.
Speaker 1 (14:36):
You get caught.
Speaker 2 (14:36):
And if you get caught, the ATF coup would go
back many, many years and you could be up for
fines and penalties and a whole pile of headaches.
Speaker 1 (14:44):
That sounds intense. Okay, quick break. When we come back,
we're going to talk about budgeting using cash, the JAR systems,
the cash envelope system. It's very exciting. We'll be back
in a second, all right. Can we are talking about cash?
(15:05):
Is cash or cash less best for the budget? We
talked a bit about whether using cards and apps and
things about whether it makes it easier or harder to
track your spending or whether it's easier to overspend. And yes,
I think we've established that if you're just tapping and going,
it is probably easier to overspend because you don't have
that pain of paying of handing over the cash. Does
(15:30):
then can we assume from that then that using cash
would help you stick to a budget better than using
cards or digital wallets.
Speaker 2 (15:38):
Yes, And I think it would actually slow down that
consumption as well.
Speaker 1 (15:41):
Yeah, it makes everything more inconvenient.
Speaker 2 (15:44):
Yeah, and got to ration that money out. Yeah, for
the pay cycle.
Speaker 1 (15:49):
Can you imagine turning up at school or something to
pay like kids, like an excursion or something, and turning
up with cash.
Speaker 2 (15:56):
Well, when I get an invoice from my son's school,
which is just a local public school, it actually says,
if you'd like to come and play cash, you Canada
Front counter.
Speaker 1 (16:04):
Well, I remember when you're in primary school and you'd
go to school with a little envelope with coins and
stuff in it to pay for whatever it was an
excursion or something. It costs like two dollars or something.
I imagine, But I mean cash was everywhere and that
was completely normal. It is completely flipped on its head, now,
what know? Yeah, I feel like I'm much more passionate
(16:26):
about this than you are.
Speaker 2 (16:27):
But also you remember, like I am in the process
of decluttering a whole pile of stuff, and some of
this stuff will go on like gum Tree and Facebook Marketplace,
where you know people may turn up paying thing for
things in cash, So it does sit in our economy.
Speaker 1 (16:43):
Can I have a little vent about how much I
am frustrated by Facebook, Marketplace and other things?
Speaker 2 (16:48):
Why not?
Speaker 1 (16:48):
Yeah? About everything else it is? It feels like now
we reached a point where unless you're selling something that
is worth say hundred dollars for instance, that it's not
worth your time. That goes into it because if you
have something up there for ten dollars and you get
thirty inquiries, all going hi, is this still available, and
(17:11):
you're right back, yes it is, and then half of
them won't respond. A couple of them will ask you
can you move on the price? A couple will ask
where it is and like it's in the ad? Read
the ad. Don't you find that it almost is better
to just say, hey, this is free, donate it to Vinnie's,
donated to the Salvos, and it gets it out of
your house. It goes to a good cause and you
(17:33):
don't have that drain on your time and your resources.
So I'm very angry.
Speaker 2 (17:37):
Clearly you've not done your research. Don't you see people
who have in the top of listing their ad like
the description says, if it is still up here, it
is still available.
Speaker 1 (17:48):
No one pays any attention to that.
Speaker 2 (17:50):
Well I do, because I am quite the Facebook marketplace consumer.
Oh okay, fine, and those things I paid for it
in cash.
Speaker 1 (17:57):
Well, I'm only going to sell to you from now.
Speaker 2 (18:01):
I do not want your junk.
Speaker 1 (18:02):
It's not junkets, quality stuff. Cash budgeting, the cash envelopes
or the jar systems, do they have a place in
modern budgeting? How do they actually work?
Speaker 2 (18:13):
I definitely think they do, and I used to when
I was a single mother on a tight, tight budget.
I had the envelope system going myself for certain expenses,
particularly like special expenses like getting my hair done, and
every week I'd put twenty dollars in an envelope, which
I had it written on the envelope, you know, hair
card or hair color, so that you know when it
came time for me getting my hair done, I had
(18:36):
the cash ready to go, and I can actually pay
my hairdresser cash as well. So it's the jar system
and the envelope system. Very simple. You just put in
a certain amount of money, typically on a consistent basis,
and the same amount and watch a pile up so
that when that expense comes around, you've got the money
ready to go and you're not dipping into buy now,
pay later or using credit cards. You know, you're a
(18:59):
lot more in control, and I think it teaches some
really healthy habits. And as I said, when you use
cash you tend to slow down your consumption. I think
that awareness actually stays with you for quite some time.
Speaker 1 (19:12):
Okay, So you have a whole stack of envelopes, or
a whole stack of jars, one for rent, one for groceries,
one for medical, all those kinds of things, and you
just when you get paid, you get it in cash
and you divvy it up between those and that's okay.
So it is essentially just similar to the budgeting systems
that we've talked about in the past, where you might
(19:32):
have a couple of different accounts set aside for different things.
You are just doing it in cash so that you
can tap into that pain of paying, the slowing down
of the spending and really that assessment of do I
really need this before I hand over the cash.
Speaker 2 (19:45):
And I think the dopamine hit of seeing that cash
in those envelopes or the gold coins in that jar
are really exciting. You actually do want to keep going,
and you respect the system and how it's supporting you,
and you know your financial journey.
Speaker 1 (19:57):
And I suppose that would be helpful and for kids
to see that kind of thing as well, because it's
hard to talk children through at an online budget system,
whereas you can that's a very physical, practical demonstration to
show them jars, to show them envelopes, and to show
them that money building up and what it's been allocated to.
Speaker 2 (20:17):
So with Rocco, I initially did cash, and he had
his little piggy bank and we had money in that,
but obviously COVID came around and that sort of all
went out the window, and I now don't do cash
around my kids. The only thing Rocco will get is
a couple of coins at the on a Friday to
get some lollies after school, and that's really that's the
entime he gets cash. But I am teaching him, maybe
(20:37):
from an ediqua point of view, you know, for example,
if he has to you know, he's got a bike
and he can earn pocket money and things like that.
So if I'm running out of milk, for example, you
know he can. I'll give him some cash and he'll
go to the shops by and I'll like, let I'll
explain to him, Okay, this is how you check the
most cost effective milk and give it a bit, make
it a bit of a I guess, a comprehensive exercise
(20:59):
with money and the etiquette of coming home with the change,
but also with the receipt. Just polite money management and
the importance of being really transparent communicating this cost this much.
I chose this brand of that bank. Is that's on
special Like it's that he's actually learning a lot and
gives me now lect just won't go to the supermarket.
Speaker 1 (21:18):
I love the fact that you are teaching him to
ask for a receipt. This is kind of music to
my ears.
Speaker 2 (21:23):
I think it's really polite. If someone says, do you
mind grabbing me something like, you just let them know
I'm not trying to if it's a bit more expensive
of what found. It just makes it really transparent. This
is how much the milk cost. If you think that
was a bit more expensive, I'm not stealing from you.
Here's the evidence, and it just I think it's a
form of protection. And that's where I explained to Rocker.
Speaker 1 (21:40):
To make sure the money's not going into the cash economy.
The one type of person that we haven't mentioned yet
that uses cash are the cash hoarders, right, And we
see a lot of stories about the number of banknotes
that are out in circulation at the moment in Australia,
(22:02):
and there is so much There is so much cash
out there even though I'm not using it, You're not
using it a huge amount, right, Yet there is more
cash out there than ever before. It is tucked away
under mattresses.
Speaker 2 (22:19):
It is kind of you know, criminal activity perhaps.
Speaker 1 (22:24):
Ah, yes, potentially dealers. Does it ever make you worry though,
when you hear stories about people hoarding their money because
I don't trust the banking system and you're like, you're
missing out on compound interest.
Speaker 2 (22:34):
It makes me really sad that they have that complete
lack of trust and faith in the system. And you know,
of course the obvious is they're missing out on interest.
But even worse if they get robbed that money is gone.
They can't claim.
Speaker 1 (22:48):
On no proof of it. Yeah, okay, finishing with one
question for you, and you have to give me a
definitive answer. You may not sit on the fence on
this one. What is better for the budget? Cash or cashless?
Speaker 2 (23:04):
Cash? Oh? Oh wow, it is quite Try it for
a week. It's going to be annoying as an extra
adminute involved carrying cash. And also people will get pushed
back from you. You know, you have to pay for
something and they don't have the right exact amount of change.
That's going to irritate some people. But it's amazing how
much more aware of your spending habits and how much
(23:28):
over consumption happens in our lives that we have absolutely
no idea of, and then we wonder where all our
money has gone. I think cash is very powerful and
it's something I would recommend for anyone, as I said,
who's drowning in debt and is on a debt free
journey and really needs to do that insightful work where
they look at the way that they're literally burning cash.
Speaker 1 (23:51):
I want to do this a one week cash trial.
Speaker 2 (23:54):
Can I add one little tip though as well? Okay
for those of you who are on that debt Free
journe and cannot fathom the idea of money for whatever reason,
maybe it's dirty or it's just an inconvenience. Can I
recommend that they check their bank accounts every morning and
night so that you have that complete awareness as to
when you are tapping the impact in watching your bank
(24:16):
balance regularly drop. That's really important. Okay.
Speaker 1 (24:21):
If we want to find more information from you, where.
Speaker 2 (24:24):
Do we reach you? Best place to get in contact
with me is on Instagram at Sugar mam My tv.
Speaker 1 (24:29):
Okay, and you can hear me every day with Sean
Aylmer on Fear and Greed business News. You can use.
Thank you very much for listening to how do they
afford that? Remember to hit follow on the podcast, and
the very best thing you can do is tell somebody
else send them a link to this episode and help
spread the word about how do they afford that? Thank
you for your company. Join us again next week
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The official podcast of comedian Joe Rogan.
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Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Special Summer Offer: Exclusively on Apple Podcasts, try our Dateline Premium subscription completely free for one month! With Dateline Premium, you get every episode ad-free plus exclusive bonus content.