‘Cashstuffing’: The TikTok trend helping people save money during the cost of living crisis

The amount of cash in circulation has been steadily decreasing over the past few years. Contactless payments have replaced it. However, a new trend has emerged among younger generations that brings banknotes back into the heart of how we handle money.

For those willing to try and save money during time of high inflation and a cost of living crisis, “cashstuffing” would have you withdraw your monthly, biweekly or weekly total budget and separate it into separating physical folders, each allocated to a different use.

While online banking apps offer ways to budget people’s savings, those who swear by the trend say using physical money changes your approach to spending it.

The trend hashtag, which is popular among Gen Z, Millennials and others on TikTok has been viewed by more than 520 million people alone on the social media site.

How does it work?

The “cashstuffing” budgeting method involves taking money from their account (enough to meet their monthly, biweekly, or weekly budget minus rent and bills) and dividing it into different folders. Each folder can be used for groceries, dinner with family, holiday savings, etc.

The trend doesn’t restrict the number or the types of expenses, and it doesn’t provide any specific amount of money people should save, but follows the common rules of budgeting.

But, however much you put in the envelope, that’s the amount of money you’re allowed to spend that month. At the end, you can review your monthly expenses, track them in a spreadsheet, or reshuffle the categories.

If you have any extra money, you can put it in your savings.

Is it really a way to save money?

For some people, seeing the physical banknotes can give them a better idea of how much money they’re actually spending, whereas tapping card payments can often have an almost “unreal” quality to it.

By using cash and having their entire monthly budget laid down in front of their eyes, people can see immediately when they’re running low on money, and what categories they’re overspending for.

If people have run out of money for their socialising, for example, they’d then turn down an outing with friends, or they’d suggest they and their pals spend a money-free time together, maybe taking a walk instead of going to the pub.

You can also check your online banking app to do this. However, seeing the money being spent and having to physically give it to another person can help people become more aware of the importance of their savings.

Additionally, it is important to limit spending to cash to prevent people with a bad spending habit from getting into debt. Online purchases made using Buy Now,Pay Later (BNPL), credit cards, or overdrafts are all examples of how to avoid going into debt.

But there’s one significant downside to this trend: security.

It is much safer to have large amounts of money at home than having savings in a bank.

“Cashstuffing” also doesn’t allocate savings for investments.

However, in times where most people are struggling even to save money at month’s end, this seems like a secondary problem.