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VAuroch comments on Boring Advice Repository - Less Wrong Discussion
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Points against this: Money spent via card has much less immediate mental impact than spending cash. When you pay more thanyou make in a month, you realize it only at the end of the month. When you spend cash, you feel the impact on your finances directly.
The pattern I use, which I stumbled upon mainly by accident: For necessities, use a card (I use debit, but this is interchangeable with credit from this perspective). For luxuries, use cash. This insulates you from impulse purchases and has a short feedback loop discouraging you from spending too much.
Drawbacks: This doesn't work for online purchases and may hurt somewhat in that regard.
Interestingly, I've been using card and online banking for so long that I seem to have internalized "money is the number stored in the bank's computer/my mental register". Recently I came into a steady flow of cash (long story), and I didn't want to go to the bank every damn week to deposit it, so I started paying for groceries and restaurants with that cash. It felt like giving away play money and getting real goods and services in exchange. "You mean I can give you some colored paper slips, and you'll just give me $100 worth of groceries? It doesn't reduce the money I have in the bank? And I'm not going to jail for this?" It was weird.