Why I am Never Going Back to Mobile Payments [For Majority of My Purchases]
Discover how switching from mobile payments to using cash has transformed my relationship with money and improved my financial stability.
I have always been a tech-savvy person and love using apps to make my life easier. I have apps for everything - from ordering food, and booking cabs, to managing my finances.
However, as much as I love these apps, I have to admit that some haven’t been the best for my finances. Specifically, the ones that allow me to make digital payments. I used to think they were super cool and convenient, but over time, I realized that they were turning me into a spendthrift.
So, I decided to take a step back and re-evaluate my relationship with these apps. I realized that it's best for me to give up on digital payments (at least for now and to some extent) and go old school by turning to cash.
It's not that I've completely given up on digital apps, but I am definitely in the process of cutting down my usage. And let me tell you, it's been a game-changer for me. It's like I've rediscovered the joys of using cash, which has made me financially stable.
My Issues With Mobile Payment
In my world, budgeting and mobile payments don't mix. It was always a nightmare. I often found it difficult to keep track of my spending and stick to a budget when using mobile payments.
The ease and convenience of just a tap or a click made it too easy to overspend without even realizing it. It was a constant battle to resist that temptation to overspend.
Moreover, I was making impulse small buys left and right. I would make multiple payments throughout the day, even for something as small as a cup of tea, and those little expenses would add up.
As a result, I would find myself going over my budget and not understanding how it happened.
Now, you all might be thinking, “Hey, it's not the app's fault, it's just your bad spending habits.” And, I get that. But, let me tell you, it's not that simple.
See, when you got a payment app on your phone that makes buying things so simple, it's pretty hard to keep things in check. And I am sure most of you would agree with this.
Research that backs this up
When I started realizing that I had an issue of overspending when using mobile payments, I started looking for something to back this up and be sure about this whole affair.
And I found a research paper on the consequences of mobile payment usage and how it influences on consumer behavior.
The research found that mobile payments reduce the “pain of paying” and evoke the "pleasure of paying" by enhancing the ease of completing transactions. The study used EEG measures to provide evidence of this "pleasure of paying" in addition to the "pain of paying" and found that mobile payments enhance purchase likelihood and that this enhancement applies to both hedonic and utilitarian products.
That’s not all…
If you have used mobile payment apps before, I am sure you're aware of the cashback, scratch cards, and gift vouchers. Well, that is nothing but positive reinforcement that encourage customers to adopt and continue using the app.
Furthermore, there’s something called gamification. It is the application of game-like elements to make an experience more compelling. Fintech apps utilize it to capture customers' attention and prolong their interest.
Switching to Using Cash
So, after determining the demerits of excessive use of digital payments, I switched to cash.
But is it making any difference? Of course, yes!
Ever since I switched to using cash, I've been noticing some positive changes in my money habits. It's only been a short time, but I can already tell that my budgeting is improving.
And it's not just about budgeting, using cash has also made me more mindful of my spending habits. I am more conscious of my purchases now and it's helping me make better financial decisions.
The temptation to overspend is also decreasing. It's not that I don't overspend at all, but it's happening less frequently. I am starting to see the benefits of using cash and I am feeling more financially confident.
But What’s So Special About Cash?
Okay, so these benefits didn't just appear out of nowhere. There are actually some good reasons why I am experiencing them. When we use cash, it changes the way our brain is wired.
Simply put, the use of cash as a medium of exchange has unique psychological effects that cannot be replicated by digital methods.
Let me break down a few of the psychological effects of using cash for you.
The tactile sensation of cash in hand
Physical cash in your hand makes the spending experience more real and tangible. When you have cash in hand, it creates a physical sensation that is not present when viewing a digital balance on a phone.
This physicality serves as a reminder that the money being spent is real and not just a virtual representation. This reminder can also serve as a powerful motivator for individuals to be more mindful of their spending habits.
The impact of cash on memory retention
Paying with cash is also believed to have a positive impact on memory retention and budget tracking.
When using cash, individuals are more likely to remember their purchases later on, leading to greater awareness of their spending habits. In contrast, digital payment methods such as apps often result in a lack of attention to transactions and a failure to adequately track expenses.
The barrier of parting with physical cash
The use of cash has also been found to lead to increased feelings of regret and dissatisfaction. And this physical act of handing over cash can be a psychological barrier that makes it more difficult to overspend.
While spending money in cash, you are more likely to think twice before making a purchase when you have to part with physical cash, as opposed to just tapping your phone.
It can be a powerful tool to help control your spending habits and improve your overall financial stability.
The Practices I Swear By, and You Must Too
Apart from all the psychological understanding and tweaks, there are a few habits that I have inculcated recently. And I suggest that you too incorporate these little tricks and see the magic.
Give your wallet a makeover
Trust me, a clean, organized wallet can bring peace to your mind. And here are some tips for a wallet makeover that I follow and you should too:
Stash cash: Instead of relying solely on your credit card or phone, stash some cash in your wallet. Seeing the physical bills will help you feel better about your money and yourself.
Always carry cash: Make sure your wallet never runs out of cash. Having some cash on hand will give you peace of mind and the flexibility to make purchases without relying on electronic methods.
Organize cash properly: No one wants to dig through a mess of crumpled bills. Organize your cash properly, so you know exactly how much you have and where it is.
Say goodbye to receipts and bills: Keep your wallet clutter-free by getting rid of any unnecessary receipts and bills. Your wallet should only hold the essentials.
Put a 24-hour pause
Spontaneous purchases are one of the main reasons why I end up in financial instability.
For instance, whenever I am at a supermarket for groceries, I end up buying some unnecessary stuff. And that point, it seems a little innocent, but it adds up.
Now, what I try to do is put a 24-hour pause. What I mean by that is I say “no” to that purchase at first even if "yes" feels like the easier option. I go home and give myself an extra day to reflect on the purchase.
Trust me this helps a lot in bringing the necessity of the item to light and breaks the spell of impulsiveness.
So next time you're about to make a spontaneous purchase, take a step back, and say "I'll buy it tomorrow". Your wallet will thank you for it.
Spend time with your money
Doesn’t matter even if it sounds silly, but you must start treating your money like your wife or husband. You must understand your money, respect your money and spend time with your money.
I have been ignoring my spending for a long time. I would just avoid my bank statements and bills, as it would allow me to have temporary relief. However, it wasn’t doing good in my financial state.
Now, I am trying to change it. I spend time with my money. I review my finances weekly and look at it as quality time rather than a chore. I look forward to creating those excel sheets and doing those calculations.
And the more I am doing it, the more confident I am becoming.
I might be in a debt or I might not have the desired amount after my evaluations, but I have the confidence that I will make things work as I am more aware of my finances.
If you want to learn more about respecting money, then I have a pretty detailed blog for you. Click the button below to read it.
The Closing Lines
I don't want to impose my beliefs on you, but I just wanted to share my personal experiences and shed some light on the topic to help you in making an informed choice.
Every individual's financial situation is unique, and what works for me may not work for you. Also, I understand that both cash and mobile payment methods have their own advantages and disadvantages.
Which is why it is important for you to evaluate your own financial needs and habits to determine which method works best for you. Some of you may prefer the simplicity and convenience of mobile payment while some may benefit from budgeting control and decreased temptation to overspend with cash.
The key is to find a balance that works for you and to make informed decisions about your financial management.
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