Cash is Common Sense

Cash helps teach financial basics in early life, and its tangible nature—plus the ‘pain’ of handing it over—help people of all ages to budget, stay in credit and build savings.

Cultures around the world have traditions of giving cash to children—such as for Eid or Christmas, Chinese New Year or a Korean child’s first birthday—and as well as being an easy, universal gift that’s always going to be appreciated, there are often lessons hidden in the fun. Such presents are among the first opportunities for a child to learn financial responsibility, making decisions over whether to spend or save their money, counting it and keeping it in a safe place.

With age comes greater responsibility and increasing demands on an individual’s finances, and cash can help once again. ‘Cash stuffing’ is a new trend for young people, but it has decades-old credentials. It takes advantage of the physical nature of banknotes and coins, plus a little human psychology, to help people find the optimal balance of incomings and outgoings.

The stuffing side of the technique refers to placing cash into envelopes, each of which is allotted to a particular expense, starting with essentials—such as rent, groceries and transportation—and progressing through to luxury items or savings. These latter envelopes are filled last, only when the former have been adequately covered.

The helpful psychology comes into the spending side. There is a scientifically-observed ‘pain of paying’ with physical money that makes people think twice before handing over their hard-earned cash. While a swipe or a tap renders a value transfer invisible, feeling and seeing money leaving one’s hand is a tangible experience, and can deter frivolous and unnecessary expenditure.

A popular expression in Germany is Nur Bares ist Wahres, which is often translated as ‘cash is king’ but more literally means ‘only cash is true’. Nowadays, while a multitude of payment options exist, each with their own benefits, none are simpler, more intuitive or more common sense than banknotes and coins.

But this is just one of the joys of cash! Look for us on your social media channel of choice to see our full series and find out more about how cash supports a friendly, resilient and joyful world.