Cash-only approach can save you money

Using cash can save more than you think.

According to an ABC News Report, one family saved 24 percent by paying cash and avoiding all plastic.

How did they do this? The family cut up eight of the nine credit cards they own. The ninth card they froze in a cup of water, to use only in extreme emergencies. By spending cash, necessities and groceries are bought but the extras are forgotten.

By looking over all expenditures paid in cash at the end of the month, it is clear how much is spent, and how much one can do without spending. Grabbing the card when all the cash is gone is a quick fix, but is extremely detrimental. Credit cards can encourage impulse purchases, such as that beautiful dress that won't be worn, or that triple latte that really isn't necessary.

ABC News reports that the family saved $1800 by the cash-only approach.

The only downside? The paper approach may slow down today's fast paced lifestyle. Searching for that one dollar bill and storing your change will take longer than whipping out the credit card. This is a downside we can probably afford to deal with.