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Ever heard of the cash-only tip for managing your spending? If you try this strategy, you might find yourself using an ATM more often to withdraw your weekly or monthly cash "allowance."

In theory, this is a great idea because it should limit how much you can spend to how much cash you have on hand. But it might not be the most effective way to manage your money and you might want to skip using an ATM and rely on your debit card instead.

Why Plastic Might Provide a Better Way to Spend

If you want to better manage your cash flow without worrying about overspending, your debit card can be a useful tool. Unless you keep all of your receipts, you can't track cash easily. With a debit card, you simply need to log into your online account with your bank to quickly get a list of all of your recent transactions.

Not only can you pull up your statements and go through them, but if you spend on a debit card you have the option to link your bank account with a budgeting software or system. That may make it even easier to track and understand your spending, without worrying about the risk of overspending that can come with a credit card. With a debit card, you can't spend more than you actually have.

Debit cards also provide much more security than cash. If cash is lost or stolen, there's little to no recourse for you — that money is likely gone. On the other hand, if your debit card is lost or stolen, your bank offers levels of consumer protection that can help you recover those funds — even if someone fraudulently takes money from your account using your card. Plus, it's easier than ever to lock or unlock your card if it gets lost or stolen by going online or using your smartphone.

Plastic provides other useful perks as well, such as account alerts and banking tools that can help you better manage your money so that you can meet your goals and build good spending habits. You also don't need to worry about withdrawing from an ATM that isn't associated with your bank, which often comes with fees. If you need cash, debit has you covered with the cash back option that allows you to take money from your account when you check out at most retailers. That way, you don't have to make an extra stop at the ATM when you go out. Instead, you can just get cash back while getting groceries or stopping in at a convenience store.

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

By selecting any external link on, you will leave the KeyBank website and jump to an unaffiliated third party website that may offer a different privacy policy and level of security. The third party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend, or guarantee any product or service available on that entity's website.

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