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With a few envelopes you can save big – or at least avoid running out of money at the beginning of the month. The envelope method, also known as ‘cash stuffing’, is especially popular in the US and is creating a real hype on Tiktok.
For example, Judia Griner (25) started this saving trick two years ago when she was still a student at a university in Virginia. “I somehow had to pay for my tuition with my money and didn’t want to build up too much debt,” the 25-year-old told AFP news agency. And debt quickly arises if – as is quite common in the US – everything is paid for by credit card.
She used to have no overview of her finances, says Griner. “I swiped my card and hoped the money would be enough.” More than 200,000 people now follow her on Tiktok. Jasmine Taylor (31) felt the same way. She has been filming herself doing household chores since early 2021 – and now has more than 620,000 followers on Tiktok. She shopped impulsively, Taylor says, and her finances were in bad shape.
“I saw the money disappear”
With cash stuffing, everything is paid in cash. The monthly salary is taken and put into labeled envelopes, which become clearly defined budgets: for running costs, rent or purchases, for example. There are savings goals for every budget.
Griner saved the equivalent of about 6,700 francs, as she says. A problem of her generation is “consumerism” and “excessive spending”. However, with the envelope method, she saw “how I spent my money, how it disappeared”. That helped her “slow down her purchases”.
Videos with the hashtag #cashstuffing have now been viewed 930 million times on Tiktok. According to Priya Malani, financial advisor for young professionals, this also has to do with the economic situation in the US. “With so much disturbing news — crypto crash, market declines, looming recession — it is only natural that people would want a little more control,” she says. Holding a banknote gives you a soothing feeling.
The envelope method has one major drawback
But Jason Howell, professor of wealth management at American University, warns, “2023 is probably the worst time to keep your money in cash.” Because there the money does not yield interest – and inflation loses its value. Jasmine Taylor therefore pays the money she has saved to the bank of the equivalent of 900 francs.
Howell and Malani doubt that the Tiktok trend around the envelope method will herald a cash comeback in the US. In a Pew Research Center survey, four in 10 Americans said they had not paid cash at all in a typical week in the past year.
However, according to Judia Griner, the envelope system is “the best way for beginners to keep track of their expenses.” It helped her to “develop confidence in money”. (AFP/jmh)
Source: Blick
I am Amelia James, a passionate journalist with a deep-rooted interest in current affairs. I have more than five years of experience in the media industry, working both as an author and editor for 24 Instant News. My main focus lies in international news, particularly regional conflicts and political issues around the world.
