Saving Money

Ask for New Bills in High Denominations to Curb Spending

Mihir Patkar, Gawker Media

Ask for New Bills in High Denominations to Curb Spending

Want to stop yourself from spending too much? Head to your bank and get some crisp new bills, ideally in denominations of $50 or $100, because you are less likely to spend them than smaller, worn-out ones.

Forbes quotes two recent studies, which suggested that the look and value of the note has a direct impact on the likelihood of spending it. The first study, by authors Fabrizio Di Muro of the University of Winnipeg and Theodore J. Noseworthy of the University of Guelph, suggested that people are more likely to spend a worn bill while they attach a sense of pride to new bills.

Consumers will spend more to get rid of worn bills because they evoke feelings of disgust but are more likely to hold on to crisp new currency, according to a new study in the Journal of Consumer Research.

The second study, by Priya Raghubir and Joydeep Srivastava, focussed on the likelihood of spending big bills over small ones. Forbes writes:

Our brains find it easy to break $5s, $10s and even $20s but will balk at breaking a $50 or $100. This is because the smaller bills are a psychological equivalent of a petty cash account, and so spending them is much more justifiable.

Sounds like a pretty easy way to curb spending.

11 Life Hacks - For Your Wallet | Forbes

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