Techniques of Cash Management

Using a debit card can help to curb unnecessary spending.
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Cash management is vital in the business world, and it is equally as important at home. Young families can get ahead of the game by learning to manage their cash wisely, keeping expenses low while consistently setting aside money for savings, investments and bills. Several simple techniques of cash management can help you to make strides in this challenging area.

Bank Accounts

Depositing all of your income into a single bank account can make it a bit easier for cash to slip through your fingers. Setting aside specific amounts of money into savings accounts or secondary checking accounts can help you to stick to your budget. If you put a portion of your paycheck in a secondary account for rent, utilities, savings, charitable contributions and debt immediately, you will know that you can safely spend whatever is left in your main account on food, entertainment and other things.

Time-Bound Investments

Placing your money in a time-bound investment can help to keep it safe while earning a reasonable return. Certificates of deposit (CDs) and bonds are two ideal options for making your cash productive over a set period of time. Choose investments that either cannot be withdrawn for some time or that incur large early-withdrawal penalties to discourage you from dipping into your funds for “emergencies” that could be handled in other ways.

Tracking Expenses

Get in the habit of asking for and keeping receipts for every purchase you make. List your expenses by name in categories to get a clear view of exactly where your cash is going each week. Many of us would be surprised to see just how much cash we spend on things such as coffee, video games and bars a few dollars at a time.


Become a savvy shopper to cut down on your expenses across the board. Try generic products rather than name brands; certain products do not lend themselves well to generic production, while other products can be duplicated with an equivalent or higher quality at a much lower price. Take advantage of coupons and bulk-purchase promotions. Find alternatives for entertainment expenses. Families in urban areas, for example, usually have access to many free movies at the library, which can save hundreds on video rental expenses.

Debit Card

A large number of people have a tendency to spend actual cash much more easily than cash in an account with a debit card. For those of us with holes in our wallets, keeping the majority of our money in the bank and only taking out a minimum amount of cash each pay period can help to avoid impulse purchases and other unnecessary spending.

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