Going back to debit and cash - Credit card use and cashbacks probably increase overall spending


I have been cutting on credit card use and started avoiding using cashback cards because I feel they screw up my decision making and lead me to spend more money.

I have started doing the following:

  • Avoid using credit cards and using debit cards instead
  • Paying with transfers from my bank account instead of card payments
  • If a credit has to be used, I immediately set up a transfer from my bank account to the credit card account
  • Funding Revolut via transfers as much as possible (I still need the better exchange rates)

I am contemplating the following:

  • Disabling Apple Pay / Google Wallet on phone and watch
  • Going back to mostly cash, though I find it really tough
  • Ditching Cumulus and Supercard (or collect for someone else)

There is empiricial evidence that I am right about doing this:

How do you deal with tempation spending?
Do you think I am overdoing it?
Has anyone done an AB test, like spending cash only in some months and then compare with usual spending over a duration?

I am interested in your experiences.


I believe that I am using my credit card as if it was a debit card. If you already control your spending, a credit card should not change your behaviour.

Ben Félix imply that not using a credit card is at your disadvantage. You will fund customer credit card advantages by not using one.
I Can’t find the episode where he mentioned it if someone can linked it.

If you want to refrain your purchase behaviour you could make it painful.
I have tried to log every spending monthly in an excel sheet and it refrained my little spending purchases…

I am not paying with my phone yet so no Google/Apple pay for me but I use mostly cards and cash only at farmer markets.


As little budgeting as I do, I budget my recurring expenses ahead. Just as I do with my savings, which are among the first things that get set aside (transferred) from my chequing account after receiving my salary. This leaves me rather tight over the rest of the month.

I always try to pay my credit card bills in full every month - that’s actually part of my budgeting strategy and holding myself accountable (to myself) every month. Precisely because I do not keep track of my credit card balance over the course of a month.

Because I budgeted relatively tightly, in advance my impending credit card bill always remains something kind of looming in the dark. And I’d consider my budgeting a personal failure, if I can’t pay that next bill off in full from my monthly salary.

:point_right: In short: I’m calculatedly going into debt with my credit cards.
And living in perpetual “fear” of being unable to pay it back.

So that encourages me to underspend on my daily expenses - rather than just blowing a positive cash balance on something because “I can still see so much money remaining for the month, I might just treat myself to…” on my current account and with a debit card.

I’m even worse with cash. Having some always makes me feel “rich” and want to spend it.

Oh my god, I’m exactly the same with cash :joy:

People can jack up prices all they want by using their CC. I don’t care about funding others as long as I spend less in the end.

Ben Felix’ point of view is always “What would a rational person do?”
If that were the case, cashback would not have any effect on people.
Since I am not rational enough, I have to trick myself into ignoring these advantages.

I’ve tried tracking my spending various times over the last few years. The longest I could keep doing it was 6 months. In the very beginning it was useful, but after a while I felt it did not change my behaviour.

Tried that for a few years. In the end, the stress made my spending even higher because I was always thinking about not overspending.

Interesting about the cash, I’ve never considered that point.
It’s a good system, although I have tried that same approach and have failed.

For me it’s just less stressful to have a realistic spending budget per month. Constraining myself too much is just adding some general anxiety that will lead to overspending.

My goal is to transfer everything away for regular expenses and savings and then leave a realistic budget on my account that I can spend or not.

That’s purely psychological though (if you watch out for credit card surcharges, that have largely been abolished anyway).

I don’t know what you mean by “purely psychological”.

There is empirical evidence that credit card use and cashbacks both increase overall spending by consumers and end up costing you more than if you hadn’t had a cashback.

I have reduced my credit card usage significantly because of this. I pay more often doing transfers from my bank account and by using my debit card.
I am about to remove Apple Pay and Google Pay because I suspect it fucks with my brain and leads to more spending. I suggest everyone to do some AB-Testing.

I’ve been thinking about going back to cash to reduce impulse buying. I am not quite there yet.

This may be going off-topic. I’ll move the discussion to a new thread.

The fact that the average American consumer does it doesn’t mean that we should generalise that to everyone. Especially not in a Mustachian forum like this - and when some of the things Pietro asked about paying with a card above are clearly necessities (health insurance, electricity).


I do believe that some people on this forum make fewer mistakes like this.

But I also think that the majority people are overestimating their ability to avoid this mistake.
I remember that someone here bought a 15’000 CHF watch and bragged about a 5 % cashback. I wonder if that person had bought that watch without the cashback.


I track our household expenses for around 4 years now and there was no change in spending after we started using a cashback credit card.

We buy what we need and instead of paying with a debit card we pay with a credit card now whenever possible. I don’t even think about the cashback when buying something and only realize it every few months when we get the cashback credited.

Same here. Moreover, I am not using my money (it remains at the bank account which generates interest) but the credit card companys money (which is insured as well, if I get scammed. Happened once.).

Always make sure to pay the whole amount. The interest on outstanding CC amounts are ridiculous.

I had a credit card until 2020.

I didn’t like to have a credit card since it was always fully paid at the end of the cycle payment (something like 11.01 to 11.02; WTF) but always had a deficit at the end of the month. It makes me nuts… At that time I hadn’t a monthly budget but never paid interest on my credit card. Also, I was using it only for Internet purchase so it was useless.

Now I use Twint or Neon ans consider my neon account like a credit card but with « real » money.

I don’t see the point (for now) to have a credit card since I can afford all I need with my setup.

Also, I think that having a credit card can be dangerous if you think that you can afford something without having the money for… So without using your emergency fund; it happens for few friend who has to pay interest for a long time…

In the end, budgeting comes down to what works for you.

I don’t think I‘m constraining myself too much with my budget, it’s quite a realistic one. Maybe even too generous for some die-hard Mustachians.

For instance, I don‘t set myself strict budgets on food / meals. That would really take away quality of life for me if I did. If some take-away food or lunch costs a 20 or 25 CHF, I don’t really think about the price, if I enjoy it.

But I do strive to balance that out with keeping to a habit of regular self-cooking and vegetarian days (saves a lot - something I could still improve and do more regularly). And not treating myself to expensive 5 CHF espresso/coffee - even when my colleagues from work consider me and mock me for being cheap, when I‘m accompanying them.


In my experience, a person’s personality can have some impact on how effectively they can use rewards and credit. I’m sure there are people who can benefit from rewards credit cards. So I can only speak for myself.

I ran A/B tests on myself several times, using primarily: rewards credit cards for 1 year; cash for 1 year, debit cards for 1 year. I then compared the data across the 3 different years. In my case, cash-only resulted in the lowest spending and highest savings. I’ve run this A/B test twice in two different decades, both times with the same results.

Now I use cash for physical expenses and Transferwise (prepaid) for online spending. I only load the prepaid card with the exact amount I plan to spend on a purchase in order to avoid the proven psychological inclination towards careless/higher spending when using cashless payments. This setup works very well for me.

It’s worth mentioning though, that I have a large family, so reaching my financial goals requires more penny-pinching than it would for someone in a different situation.