I received this insightful email from Carol, a DebtIntoWealth client...

My Oklahoma dustbowl parents instilled in me a lot of the ideas presented in the Debt Into Wealth program.  I learned early the value of saving, paying my bills on time and keeping a spotless credit report. My husband and I had been progressing nicely towards debt freedom, when life threw us a curve that really set us back.  That problem was caused by identity theft where we found that although banks say your funds are insured and they have you covered, after 7 months, we are STILL waiting for a refund of several thousand dollars.  We cancelled all our credit cards and had been trying to only use cash.  That took some getting used to!!  We still use checks to pay the mortgage and utilities.

More and more it seems like our financial system is crumbling down before our eyes.  We wish that there were still banks that had NO ACCESS to the internet.  Plastic cards and paying on line may be handy, but we have found that they can cause more havoc than any person deserves in a life time.  Maybe it’s time to try a NEW-old idea! 

Lets all return to using cash!   

Here are some of our learning experiences. The first thing we found was that it takes about 2 weeks to activate that part of your memory that keeps track of how much cash is sitting in your wallet.  Until your “running total” becomes part of your subconscious be careful how much stuff you put in your shopping cart.  If you ditch your checking account and use money orders, shop around.  We found some groceries charge 35 cents per order, some places charge a dollar or more.  Despite TV commercials to the contrary, merchants really do like cash.

Big purchases, (for us cattle feed, fertilizer, FUEL!) you can get a cashiers check from your bank for the bulk and make up the extra with cash. You will need to keep good records, no more monthly statements to show where the money went.   But all in all, the way our parents and grandparents did it was really the better way.

 

Slowly we are recovering, and we hope soon to be comfortable with the “pay as you go” way of life.  We are encouraging our kids to try the Debt Into Wealth system, but just like us at that age, they think they are invincible.  Time has a way of showing them the real truth.  If anyone has any other helpful suggestions, we’re all ears! 

 

A favorite saying of my grandparents was “when the going gets tough, the tough get going!”  I believe their way of planning, saving and using cash to pay as you go is the same system that will help us to get out of this credit nightmare we live in today.  Care to join us?

What do you think? Any helpful suggestions for Carol? What was it like when you first started trying to live on cash? How did you feel? What did you learn? How did your financial picture change?

I lived several months in a part of Mexico where debt-cards were used to balance table legs, not buy food -- or anything else, for that matter. Cash -- Pesos -- was the currency of the realm. I noticed several things...

1. Paying cash was often painful. And with a 10 to 1 Pesos to Dollars exchange rate, you had to physically count out a lot of Pesos to buy stuff. This only exacerbated the pain. Plastic never felt this way.
   
2. Didn't need to budget. When I was out of Pesos, I was out of budget. Time to call it a day.
   
3. Where the rare institution accepted debt-cards -- think Costco, Walmart, Sams -- there were always two prices on the sticker. One for credit, one for cash. Guess which price was lower.

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Greg Moore is the Creator of the Wealth Building System
'DebtIntoWealth -- Lessons from My Journey to Debt Freedom'

   "My husband is due to retire from the Navy in just two
    years at a young 42 years old, and right around then,
    using your system, we'll be completely debt free, which
    means  we could literally never have to work another day,
    if we choose."    -- Andrea Davis, South Korea

You CAN get out of debt and break the addiction. Click now:
http://www.debtintowealth.com/stretcher.html

"We are encouraging our kids to try the Debt Into Wealth system, but just like us at that age, they think they are invincible. Time has a way of showing them the real truth. If anyone has any other helpful suggestions, we’re all ears!" My kids are the same way. I don't have any advice, but I do have sympathy. They live on credit and don't see anything wrong with it. Since we don't have the big house and a new car, they don't see the advantage to paying cash. If they can get it on credit, why not enoy it? That's their attitude. I use a credit card for online purchases and I use online banking, but we stick to cash and checks for rest. Money orders are more expensive than checks, so I wouldn't do that. To me, it works better to use checks, because I'm not going to write a check for a dollar or two the way I'd spend cash. I keep a little cash ($10) in my wallet, but when it's spent, I don't replace it until the next month. I don't worry about identity theft, but it's never affected me. It might be different if it had.

I have three children (two will in college this fall) and am married to my second husband (not the children's father). When we became a big blended family we bought a huge old house so everyone could have space to be alone. Not the greatest idea but the children loved having their own spaces. This old house is constantly in need of repair and as the years passed we found ourselves borrowing more and more to meet expenses. Of course, we were NOT meeting expenses but borrowing to stay where we were. For the last six months we have been going through our expenses and realizing we have to change our way of life right NOW in order to retire in ten years when my husband is 65.

So now we are living cash only. At first it was terrifying because there are always events like birthdays, graduations, anniversaries that we were used to celebrating with presents and dinners out. And to stay on the cash payment plan we had to give up some of our old expectations. But now it's easier, and I am used to cooking every meal and making our own repairs, and finding free stuff to take the children to for together times.

 The only advice I have for people who have been living on credit cards for a long time is to accept that the first month or so will be very hard as you adjust to a much lower expense allowance. Track every dime, and review where the excessive costs are. Then be willing to downsize, cut back, sell things, and work more to get back on track. We are quickly paying off debt and by the time we sell our current home and move to a smaller place we will be able to stash double into retirement accounts compared to what we can do now.

Peace