Picture this: you’ve been queuing forever for your things, and as you finally approach the head of the queue after seemingly YEARS of waiting, you hear 3 horrifying words: “Sorry, cash only.”
How inconvenient! You scoff. Who even carries around cash nowadays? In the age of Paylah, Paywave, Grabpay and a plethora of other virtual payment options, carrying around cash could even be considered a faux pas in this generation.
And there’s certainly no reason to! Even our hawker centers are moving towards cashless options and all for good reason: virtual payments are safer, more convenient and even more effortless. There’s no need to fumble for coins or do the mental acrobatics in your head. There’s no need to feel the weight of your money leave your pocket, and you can go about your merry way ignorant of the dwindling number in your bank account. Suddenly you’re down to your last $2, and it’s only the 15th day of the month.
As we progress towards a Smart Nation, going cashless is inevitable and welcomed, filled with enticing benefits like cashback and split payments as an optical illusion to distract you from how your money is Houdini-ing away from your bank account.
This is why it’s important to update the ways we protect our money as the world updates the ways we handle money. It’s even more crucial to always stay conscious of your spending and plug up those pesky leaks, no matter how uncomfortable it is to do so. Hence, we came up with 5 easy tips for you to use to stay financially woke and keep up with the convenience without compromising on your cash!
TIP #1 –– KNOW YOUR LIMITS ––
Virtual payment options are increasing, and the exclusive benefits that come with each of them that can sometimes lead us to juggle multiple accounts and payment methods. There are only so many balls you can keep in the air before your act comes tumbling down, so unless you’re trying to look like BooBoo The Fool, learn which payment methods are the ones you use most frequently and are most accessible to you.
For instance, if you frequently use the Grabpay option for taking Grabs and for Grabfood, the money you top up into your Grabpay account should be taken accordingly from your transport and dine out budget (not sure how to budget your income effectively? Hop over to our 6 JARs article for budgeting made easy). Yes, ordering delivery does count as eating out, even if you’re eating it alone in your underwear.
If you use DBS bank, it also might be wiser to switch from using Paynow to Paylah, where the latter allows you to set a daily limit which can help you control and keep track of the money that leaves your account. Similarly, set your tap-to-pay limit on your debit cards.
The bottom line is –– don’t rely on auto-top up and limit yourself to 3 main channels of virtual payment.
TIP #2 –– MINIMISE IMPULSE BUYS ––
A single grain of rice can tip the scale, and that’s exactly what all those small purchases are doing to you. What’s the big deal with spending $1 on a box of Pocky, $3 on a face mask or $5 on bubble tea? Well, all these pesky small leaks definitely add up, because leaky taps don’t come in downpours, they slide past our attention in small drips, only coming to our attention once the exorbitant bill drops into our lap.
That’s why it may be smarter to have a set amount of cash ($10-$20) solely for these small purchases and think twice before you buy it. Some things can be lived without, trust me. You won’t die because you made the mature decision not to indulge in Hotstar when you know you’re going home for dinner soon.
TIP #3 –– SPLIT PAYMENTS ARE AN OPTICAL ILLUSION ––
This has become an increasingly popular payment method for many online retailers, and it’s enticing too. Suddenly, that $100 ASOS order that’s been sitting in your cart is only $25 dollars right now, and you happily whip out your card, ready to click check out and browse some more. Now, let me stop you right there chief. If you don’t have enough money to make the full payment right now, you’re in no position to be making split payments.
If you can’t afford it once, what makes you think you’d be able to afford it over a period of 4 automatically deducted payments. Let’s be real with ourselves booboo. You’re less likely to remember you even made the split payment and more likely to be scratching your head down the line, wondering why you’re suddenly 25$ short the next month.
TIP #4 –– FORGET ABOUT YOUR FRIENDS’ BIRTHDAYS, NOT YOUR SUBSCRIPTIONS –
Who doesn’t like free stuff? And yes, while being a kiasu Singaporean does play a role in our love for free things, there’s a very real science behind the positive emotions that free things elicit from our brains. Dan Ariely’s bestseller Predictably Irrational delves deeply into this, but in short: in a capitalistic system, free stuff feels like an unexpected gift or a reward, and this sensation of joy is likely to impact your subsequent choice.
And that’s exactly how game and app developers lure you into their web because they know you can’t resist signing up for free trials or free subscription periods. And then one of two things happen: you either forget to cancel the subscription, or you end up liking their product enough to keep up with the continuous payments.
This may seem like a no brainer, but you’d be surprised how in-app payments are often overlooked in personal budgeting. An easy fix is to set a reminder to cancel those free trials right after you sign up for it. Keep a log of all your monthly subscriptions and make sure that it’s factored into your budget. Alternatively, it may be better to do a one time or yearly payment for all your subscription services, which ends up being cheaper for you anyway.
#TIP 5 –– LOOK YOUR FAILURE IN THE EYE ––
Your bank account statement? Look at it. Stare at it. Memorise it. Take a red pen and circle all the redundant purchases you made, add it up and soak in the shame of your spinelessness.
Let the regret flow through your mind:
“Why did I take so many grabs?”
“How could I have spent so much on bubble tea?”
In the age of virtual payment, the worst mistake you can make is to avoid looking at your foolishness in the eye, especially since you won’t be able to feel the weight leave your wallet. So make it a point to go through your bank statement at the start of every month because the only way to stop making mistakes is to be aware you’re even making any at all. Ignorance may be bliss, but being financially trapped definitely is not.
if you’re worried that your habit of overspending when you’re cashless is starting to eat its way into your precious savings, look into opening a SAVINGS ACCOUNT, or a fixed deposit account, especially to keep your long term savings expenditure. Talk to your trusted financial advisor if you’re unsure about which savings account to open, or other alternative options that can help keep your finances in check. Don’t have a trustworthy Financial Advisor? Head over to our SyncWealth App to connect with one now.
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