What Is Cash Stuffing And Why Are Millennials Using It?

Cash stuffing is a relatively new concept. You might have heard about it on social media, but you’re unsure what the term means. We’ll explain cash stuffing in the following article, and we’ll also talk about whether it can potentially work for you.

What is Cash Stuffing?

Everyone has different ways of paying bills and handling debt. Some people will look to consolidate multiple debts into single monthly payment plans. Others are okay with having various bills due over the course of a given pay period.

The point is that a budgeting or payment strategy you implement might work for you but not for someone else. That’s kind of what’s going on right now with cash stuffing, which some financial experts regard as a little controversial.

The basic idea is that you’re only spending physical cash on your expenses. You create category-based envelopes and label them according to your monthly bills. Then, you put physical money in those envelopes in anticipation of paying those bills.

Why is Cash Stuffing Appealing?

The question many people have about this technique is what purpose it serves. You could just as easily pay your bills with a check or credit card.

The response that most individuals give who use this strategy is that it takes away the pressure of keeping track of your expenditures in your head. If you use this technique, you cash your paycheck and put the money you owe for each bill in the appropriately labeled envelope.

Then, you’ll know for sure the money is going toward the proper expenditure. In other words, you’re not tempted to spend cash you don’t have on frivolous purchases because you’ve earmarked that money and put it in the correct envelope.

Why Do Millennials Like This Method?

If you’re on social media, you might also notice that cash stuffing is becoming popular with members of the Millennial generation. Most people consider Millennials to be individuals born between 1981 and either 1994 or 1996.

The reason most Millennials give for why they like this method is that it encourages them to be disciplined with their spending. Inflation is wreaking havoc with the monthly budgets of many families and individuals right now. It can be tough not to overspend if you have a tight budget.

If you’re a Millennial and use the cash stuffing method, you avoid using a credit card. If you can stay away from credit card usage, it’s harder to overspend. Part of what’s appealing about credit cards is that they’re so easy to use, so you can overextend yourself if you have one.

Potential Drawbacks

While the cash stuffing fad seems great for maintaining spending discipline, it comes with some potential drawbacks. For one thing, if you have cash in envelopes at home, you make yourself a more tempting target for thieves.

There’s nothing to say someone will break in and rob you, but you can always report credit card theft to the company, and they’ll cancel the card. You can’t do that if someone steals physical money from you.

The other issue is that it’s a little more difficult to pay for some things in cash. It’s easy enough to make a credit card payment online for something like the gas bill. The company will probably not be too happy with you sending them cash in an envelope every month instead.

Should You Try Cash Stuffing?

Whether you’re a Millennial or not, cash stuffing may appeal to you. There’s no question that it can curb your spending habits and encourage financial discipline. On the other hand, if you try it, you open yourself up to theft if you always have envelopes of cash at home. It’s also harder to pay for certain things with physical money.

If you think the benefits outweigh the drawbacks, you can try cash stuffing and see how it goes for you.