I came across this idea a while back. We have been using it for two years and it seems to be working pretty well for us. I thought you might be interested in it too if 1- you can’t handle cash budgeting but 2- you need to keep track of your spending in a real way, or 3- you just want to be able to see where you money goes to set up some kind of budget no matter how tight or loose that might be.
Here’s a detailed video that started it all for me.
I have tried a few different ways to use this type of system, including the way Jordan explains it in the video, but settled on what I am sharing here because it works best for our family and including a FREE download of my envelopes.
- Print 12 envelopes and label them for the year. These are stored in my monthly folders (post coming soon). Doing all the prep at once really helps me eliminate the excuses and be prepared for success.
- With a big magnetic clip, hang envelope on refrigerator. I choose this place because it’s central and the stopping point after entering the house from any adventure that includes spending. This has only been an issue when there is online shopping- because we have to remember to write it down in the kitchen.
- Record spending in the appropriate category with the date. If you have a monthly budget for each category, you can write it next to the category heading and keep a running total as you add expenses. For example. We budget about $450 a month on groceries. So entry would look like this : 10th- Aldi, $110 // $340, 17th- Aldi, $98 // $242
- File receipt in envelope. I try to write a big “K” on receipts I want to keep after the end of the month (might be needed for a return or exchange kind of stuff). All gas, grocery, or restaurant receipts are tossed without thought at the end of the month.
- Move extra to savings at the end of the month. (This is kind of hit or miss for us right now, but it’s a great idea in theory.)
A few things I like best about this budgeting method-
- It’s flexible with our life and income.
- It doesn’t require major input or calculations that were holding us back from budgeting at all.
- It’s simple and accessable – no technology needed.
- It’s one step.
- It’s visual- we can see right away where we are spending our money and adjust accordingly.
It’s not a perfect system. It’s not hard core, but it’s been working for us and we can see where our money is going, which is have the battle in controlling spending.
Print your own envelopes. Get our envelope file HERE. Set up to print on standard envelopes.
I’d love to know if it works for you or if you have any suggestions.
It’s your day,