The verdict on 3 TikTok money trends

More and more people are turning to social media for tips on budgeting, saving and investing. TikTok, in particular, appears to be a favoured source of inspiration. The hashtag #MoneyTok, for example, has racked up 29.8 billion views while #savingmoney has had close to seven billion views.

Some of the savings tips and strategies have proven to be more popular than others with a number of TikTok money trends going viral. We take a look at three that have taken off, how they work and whether they are any good.

Cash stuffing

Cash stuffing is one of the biggest money trends on TikTok. The hashtag #cashstuffing has had a whopping 1.9 billion views and features roughly 103,000 posts. Funnily enough, cash stuffing is not a new concept but it has experienced a resurgence thanks to the social media platform.

So what exactly is cash stuffing? Essentially, you group your spending into different categories – for example, groceries, petrol, dining out – and set a spending limit for each of them. You then prepare an envelope for each category (which is why cash stuffing is also referred to as ‘envelope budgeting’ or an ‘envelope system’), withdraw the total cash you need and ‘stuff’ each envelope with the allocated amount.

When it’s time to pay a bill or buy something you have to use cash from the relevant envelope. The money in each envelope is meant to last until your next pay (or whatever time period you choose). You can even buy labelled cash envelope wallets so you don’t have to carry paper envelopes around.

Keep in mind that you won’t be able to pay for everything with cash. Some expenses such as your mortgage, rent, streaming services and other utilities may still have to be paid electronically.

The great thing about cash stuffing is that it’s a tangible way to keep an eye on your spending so that you can stick to your budget. It’s easier to lose track when you use cards. Research suggests that people also tend to spend more when they use cards than they do when they use cash which is another benefit of cash stuffing. Another perk of using cash is that you can avoid card surcharges often charged by retailers.

Cash stuffing isn’t without its downsides though. Having cash in envelopes rather than money in the bank can mean you miss out on interest. That being said, if it’s money you would be spending you probably wouldn’t accumulate much interest anyway. Then, of course, it can be risky carrying around large amounts of cash or even keeping it at home. Finally, making trips to the ATM to withdraw cash and setting up your envelopes can be time-consuming.

The verdict on cash stuffing

It can be a good way to manage your money – especially if you’re prone to blowing the budget or racking up debt. Just take care with your cash when you’re out and about and store it somewhere safe at home. Make sure you still keep savings in a bank account where it can earn interest.

If you like the concept of breaking down your budget into spending categories but aren’t a fan of the cash element, many banks will let you set up multiple free accounts. You can treat each account as an envelope and even label it by giving it a name.

Source: https://vt.tiktok.com/ZSFpGwfAJ/

100 envelope challenge

Envelopes seem to be a recurring theme in TikTok money trends. While cash stuffing is best described as a budgeting method the 100 envelope challenge is a money-saving strategy. And if it goes according to plan, this trend will see you save $5,050 in 100 days.

It works like this: Label 100 envelopes from 1 to 100. Each day, you pick an envelope and then you fill it with the corresponding dollar amount. So, you put $1 in envelope one and $90 in envelope 90.

You can fill the envelopes in sequential order or you can shuffle them up and pick one at random each day. The advantage of choosing them randomly is that you’ll be alternating between smaller and larger sums rather than the amounts getting progressively bigger.

The drawbacks of the 100 envelope challenge are similar to those of cash stuffing. You won’t earn interest on your money, having that much cash at home isn’t the safest option and getting the necessary amounts of cash for each envelope can be a hassle.

These can all be overcome by not using cash for the challenge. You can still label your envelopes and pick them out each day but rather than stashing cash in the relevant envelope you transfer the amount into a specified savings account.

The verdict on the 100 envelope challenge

The 100 envelope challenge is great in theory but how realistic is it for most people? If you think you can complete the challenge, that’s great. If you want to give it a go but are concerned it’s not feasible you can make some tweaks so that it better suits you. Maybe you pick an envelope every second day or just twice a week instead of daily. You’ll still reach that $5,050 goal – it will just take you longer. Or perhaps you make it a 50 envelope challenge (which incidentally will mean you can still save a tidy sum of $1,275 in 50 days).

Source: https://vt.tiktok.com/ZSFptNMm1/

Loud budgeting

We have comedian Lukas Battle to thank for the term “loud budgeting” which he describes as the opposite of “quiet luxury”. What started off as a joke in a TikTok video of his 2024 ins and outs quickly became a viral sensation.

Loud budgeting is all about being open and honest about your financial situation and what you’re willing to spend money on. As Battle explained in a follow-up video, “It’s not ‘I don’t have enough’, it’s ‘I don’t want to spend’.”

So it’s more than just being mindful about your spending but being vocal about your goals and priorities and not feeling embarrassed about it. Let’s say your friends want to go out to an expensive restaurant but you don’t want to spend that much money because you’re saving for a holiday. Rather than feeling pressured to go along with it you can tell your mates you don’t want to spend cash on a pricey dinner so you’ll give it a miss or meet them for a drink afterwards.

The verdict on loud budgeting

Loud budgeting can reduce the pressure of keeping up with the Joneses and can help you achieve your financial goals. However, you don’t want to say no to every social invitation that comes your way. Try to come up with free or cheap activities that will help you get that balance right.

Source: https://vt.tiktok.com/ZSFpGKwV8/

Cover image source: comzeal images/Shutterstock.com