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Two Hundred Dollars in an Envelope

Posted on Friday, January 27, 2023 in Financial Education

Cash Stuffing: The TikTok Trend

Have you heard of ‘Cash Stuffing?’ It is a budgeting tool which has gained a lot of attention on TikTok. Hashtags #cashstuffing #SavingsChallenge #Cashenvelopesystem #Debtfreejourney #cashstuffingbinder abound. Videos under #cashstuffing have garnered more than 854 million views.

Young people are saving money and paying off debit through ‘cash stuffing.’ And the way in which they are inspiring others is phenomenal through this social platform. The videos feature colorful, personalized cash binders with compartments labeled for different budget categories such as gas, food, rent, and entertainment.

Amazon marketers have also capitalized on the trend by offering hundreds of budget binders, envelopes, labels, and pouches.

How ‘cash stuffing’ works

The concept of ‘cash stuffing’ is not new; it is similar to the envelope (or jar) budgeting system which involves dividing cash into different envelopes that represent various spending categories. It is intended to control your spending each month by limiting you to using only what is available in each envelope.

The revival of this budgeting and savings approach may have more to do with high inflation. Rising home energy costs and skyrocketing gas and food prices have everyone scrambling to find a way to cover expenses. Individuals and families are making tough choices about where they can cut their budgets, without going into credit card debt.

Limiting daily expenses, such as how much you to spend on coffee and gas, to cash-only has also proven to be a motivator for TikTok users to stay within their budget. One TikTok user, whose videos focus on living frugally, explained “if you can touch it and see it [meaning your cash money], it all seems much more real than spending blindly with a debit or credit card.”

While TikTok users are shifting their spending habits due to inflation, they are also discovering ways to set aside money in their budget each month to either pay off debt (especially credit cards), to start an emergency savings fund, or to put money away for a dream financial goal.

One mom on TikTok explained how she puts aside a small sum each month for her kids. Out of that envelope she purchases birthday and holiday gifts, as well as pays for them to participate in school activities.

Another single parent on TikTok has started a Dream Home envelope. He is saving for a down payment on a home to build a better future for himself and his son.

Safety First

While having envelopes or binders filled with cash can be a great budgeting tool, keep in mind the risk of potential loss and your personal safety of keeping all that cash at home.

If you would experience a fire, your entire life savings could end up in ashes. Homeowners’ and renters’ insurance only covers a limited amount of cash if lost or destroyed.

Sharing information on social media about the fact that you have cash at home could also put you at risk from sticky fingered relatives and friends, thieves, or follow-home criminals.

If you accumulate a sum of money, it is best to keep it in the bank where it can earn interest and be insured. Reliance State Bank offers several saving options that can provide you with access to your cash when you need it or keep it safe while you save for a longer-term goal.

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