I received an email from a reader the other day, asking about cash vs. debit cards, and he gave me permission to share with you all. The question was:

If one were to stick to paying cash for everything, would one have a higher tendency to spend more often with cash or with a debit card?

Before I adopted a “no debt” policy, I would have said one would have a higher tendency to spend more often with cash. I used to be the kind of person who couldn’t carry cash around, or I’d spend it. All of it. But I had a credit card to fall back on, so it was really no big deal if I ran out of money. I could always get more, even if I had to pay a nasty interest rate. Yes, that’s how money-dumb I was in my college years.

After I got married, my husband and I used the credit card for emergencies only. I still spent any cash that I had. Having the safety net of the credit card somehow made it easier to spend cash. And since I never really knew the balance of the checkbook, spending actual dollar bills was much safer than using a debit card.

Since I’ve gotten my financial life in order, though, I find that I have a tendency to spend more money with a debit card than with cash. I think there are several reasons.

First, my debit card is always available. When I’m out shopping, I always have my debit card with me. If I see a sale on something I wasn’t planning on buying, I can buy it with a debit card. If I were to use a cash only policy, I wouldn’t be able to buy without cash on me. There are advantages and disadvantages to using either.

On the one hand, it’s nice to have money available in the event that you run across a great sale on something you really need. Paying a sale price is always better than paying full price. On the other hand, if you’re using cash only, you may miss out on some deals if you don’t have the cash. But you will be forced to stop and think about every purchase, which is a good thing. Too often sales aren’t good deals, because you didn’t really need the item to begin with.

Second, using a debit card gives you a sense of somewhat unlimited funds. If you’re grocery shopping with a budget of $100, and your groceries ring up at $105, it’s easy to forget the budget and pay for the entire amount with the debit card. If you only have $100 cash, though, you will have to put something back. I think it’s easier to stick to a budget with cash only.

Finally, since I tend not to spend change, spending cash actually helps me to save money. When I get home from shopping, I put my change into the change jar. If I get 50 cents in change every day, that’s $3.50 a week in the change jar. Or $14 a month. Or $182 a year. If I make a commitment to use the money in the change jar toward paying down debt that $182 has a pretty good impact. If I use a debit card, I don’t have any change to put in the change jar, and that $182 is used on other things.

I will confess that I mostly use my debit card, because it’s convenient. But after writing this post, I’m seriously considering switching to cash. I do think there is a tendency to spend less with cash than with a debit card. Maybe next week I’ll experiment to see if I notice a difference.

What do you think? Do you tend to spend more with cash or with a debit card?