By Dave Ramsey
Everyone knows this universal truth: The bigger a woman’s purse, the more she’ll cram into it. The same goes for the humble wallet—all those nooks and crannies are too easily filled with old business cards, empty gift cards and expired coupons.
So make life easier by cleaning out your money holder. Because when it comes to budgeting, digging for your dollars shouldn’t be half the battle. Here are the only five things you really need in your wallet.
Yes, cash is bulky. There it is. But cash is also powerful.
It can get you a bargain—try flashing cash as you negotiate for your next car. It can keep you accountable—as your cash dwindles, so does your grocery budget (and we all like to eat). And it can keep you from buying that awesome grill on impulse—because if you can’t pay cash, you can’t afford it.
Credit cards may be sleeker and sexier, but can they do all that?
A big wad of cash, however, isn’t necessarily going to solve all your problems. It’sthe plan behind those tens and twenties that make them work. So before the month begins, sit down and give every dollar a name (groceries, clothes, entertainment, fun money). And instead of allowing your dollars to just float around unorganized, separate your bills with the envelope system. You can even get a simple insert to put inside your wallet, so you know how much you’ve spent in each category as the month goes by.
However you choose to organize, make sure the workhorse of your wallet is cash—not credit. It’s king for a reason.
2. Driver’s License
You need your driver’s license to drive, to fly, to cash a check, and even to buy certain over-the-counter medicines. And some folks (not you, of course) need it when they get pulled over for speeding, purchase alcohol, or want to see that new R-rated flick. No matter how you use it, this state-issued ID does a lot, so don’t forget it!
3. Debit Card
Debit cards are super handy when it comes to booking travel, filling up with gas, or shopping online. Plus, debit cards have the exact same fraud protections as their credit counterparts, as long as you run the transactions as credit. And while your debit card can’t get you into real trouble (ahem, debt) like a credit card, it can make it easier to overspend.
So instead of making swiping a habit, restrict your debit card usage to budget categories you wouldn’t normally pay cash for. Because using dollars and cents for everything else can drastically improve the way you spend and save your money.
4. Insurance Cards
Medical emergencies and traffic accidents don’t warn us beforehand. They just happen. That’s why we pay for insurance coverage in the first place. So don’t forget to carry proof!
While most of us keep our vehicle insurance cards in the car (which is fine) it’s smart to keep your prescription drug and medical cards in an easy-to-get-to place in your wallet. Hopefully you won’t need them, but at least you’ll finally know where they are if and when you do.
5. Membership Cards
Between all those loyalty cards and punch passes, you should have a few membership cards that are actually useful. Keep the important ones like Costco, Sam’s Club, AAA and your gym membership in your wallet. But for everything else, opt for key ring cards (or just leave them in an envelope in your glove box) to cut down on all the clutter.
When it comes to your wallet, less junk means more control. So take control of your life and your money by straightening up the way you handle both. You may even find that long-lost twenty somewhere!
That alone is worth five minutes of cleaning.