Cash Tracking and Money Psychology

Just heard about Tweet What You Spend on the radio. While it’s not what I thought it was originally, it does address a real issue: cash tracking. (Granted, if you’re going to pull out your phone and open Twitter and then type in a note about what you’ve spent, it’s probably just as easy to use some sort of spreadsheet program or other customized budgeting app.) A staple of financial education, cash tracking helps people better understand their money habits. A credit card will produce a list of purchases each month to answer the question, “How much did it cost?”, “Where did my money go?”, “What did I buy?” or “How did I spend my money?” that’s not the case with cash, which leaves no trail.

In terms of tracking, it’s no wonder the site is making the news right around New Year’s. After all, New Year’s resolutions generally involve behavior change in some form. Much like changing one’s eating habits or embarking on a diet, transforming spending, saving, or financial priorities is a common goal. Keeping a diary of current habits proves helpful in identifying areas for change and visualizing potential improvements. In the context of a game, Money Habitudes enriches individuals’ understanding of their money-related habits and attitudes, offering a comprehensive perspective on spending and saving.

Encouraging individuals to delve deeper into their financial habits and attitudes, this potent teaching tool poses advanced questions about when, why, and with whom money is spent. For instance, while cash tracking might reveal an unexpected $15 spent on coffee last week, a thorough analysis could uncover that the unnecessary expense was influenced by factors like rushing, treating a friend, or avoiding a meeting without a brand-name brew.