Cash Stuffing

Cash stuffing: Saving goes old school

Many younger Americans – whose phones are often filled with apps to help with everything from driving to investing – are turning to a method of saving that would make their great grandparents proud.

Cash stuffing is exactly as it sounds: Stuffing money into envelopes with labels like mortgage, insurance, utilities, entertainment, and savings. It’s a way of budgeting, but with physical money instead of digital transactions. The thinking goes, once the cash is gone for a certain item – say, entertainment – it’s gone.

#CashStuffing: A social phenomenon

YouTube, TikTok and Instagram offer hundreds of how-to videos. A quick online search reveals thousands of posts carrying the cash stuffing hashtag. So . . . why?

Well, the reality is, people tend to spend less when they’re using cash than if they’re just swiping a card or making an electronic transfer. According to a 2023 Fundera by nerdwallet report, the average value of a cash transaction was $22, compared with $112 for non-cash transactions.

Physically dividing up your money can also make you more aware of how much you’re actually spending on things, and that can curb overspending and impulse purchases.

Saving without envelopes of cash

Cash stuffing may help some people save money, but it’s by no means a time saver! Chances are, you probably have other things to do than stuff money into envelopes each month.

We have more sophisticated (and less time-consuming) strategies to help you build an emergency fund. Improve your cash flow. Invest in your retirement. And save at least 20% of your income, no envelopes needed.

Pub12153 2023-156064 Exp. 5/25 *pre-approved content*