Do you use an envelope system?

[AlligatorBaby]

If so, how do you do yours? Just wondering

[Exile]

If you mean budgeting one's income for various monthly bills such as groceries, laundry, utilities, etc. and placing the money for these items in marked envelopes, DW has been doing this for years, and it works very well.

[snafu]

When we started out we used a 'jar' system. We labelled jars for discretionary spending: Food/restaurant, Transportation, Clothes, Entertainment, Gifts, Household-non food. We put agreed sums in ea. jar and when the money was gone, the spending stopped in that category. The challenge was to get to the end of the month before getting to the end of the money.

We each got a cash 'allowance' for personal use that was non accountable. 5% Savings, Rent, utilities, car payments were considered non-discretionary and paid 1st.

It worked well and taught us to be disciplined with spending.

[skydivingchic]

I've used Mvelopes for about two and a half years with great success. It is virtual envelope system which allows me to spend using my credit and debit cards instead of cash. Spending is assigned to electronic envelopes just like cash would come out of specific envelopes in the traditional system, so I always know how much I have left in any given category.

[zetta]

I use envelope-base budget software from Personal Budget Software - Free Home Budgeting Program for the Family and highly recommend it. It's a lot cheaper than Mvelopes (which I have also used in the past).

Personally, I'm in a position where I don't need to maintain a strict budget (large emergency fund and investment portfolio), so I use it mainly for tracking my spending and planning for future changes. When the twins are born, I'll probably be more strict with the budget for the year or two that I return to being a SAHM.

[boosami]

My friends are big fans of the Envelope System and have used it for years. If I remember correctly, they have about 8 different categories, but I couldn't tell you what they are. They figured them out by keeping track of every penny and then going back and grouping them into like categories.

[irmanator]

I sort of do, I have ebanking and billpay and auto save. Then i figure out whats left this week and take that out of the atm. I put my gas money in the ashtray of the car. (I can only buy 10 worth at a time till i find a new gastank.) Then I put 3 aside for the garbage, i drop that off and it goes by wt. but I rarely do it on payday. Then i do grocery shopping with some of whats left. Then i am done spending till next Friday. Works for me and since my savings is automatic I got it covered.

[cantretire]

I used an envelope system when I was young - sooooo many years ago! - and it worked great. Now the internet is my envelope system. I don't really need envelopes no, but in a way I do it virtually. All my monthly bills are paid automatically or online and I have that carefully budgeted and tracked in an Excel file. My rent is paid by check as are some rare expenses. The only cash I need is for groceries and a bit of pocket money. I take out $X on payday and that's it until the next payday. I just make it last. I do keep about $30-40 as 'emergency milk money', but I find I rarely need it. (I also keep a few hundred hidden, but that's for big emergencies.) If I need any additional cash for a special occasion/gift, I budget for that as well and will keep that separate from my regular cash until that day.

Envelopes are a great system for a lot of people. Give it a try and tweek it to your own needs.

Good luck with whatever system you use!

[AlligatorBaby]

Thanks! It was interesting reading what everyone does.

[lehresman]

I used to use a spreadsheet to manage my envelopes, but that got tedious entering all the transactions manually. So I created a website that manages my envelope budget (see my signature). It lets you import transactions from my bank, so it only takes about 10-15 minutes a week to update my budget.

As far as envelopes go, I tend to go a bit overboard. I have 30 envelopes currently for various spending and saving categories. Different people have different needs, but I like to have a detailed budget. I know some people who just have two envelopes: Groceries/Gas and everything else.

[watsoninc]

I have never used an envelope system. I do use the internet and a detailed excel workbook to manage my income statement and balance sheet. Nearly, all my monthly bills are paid automatically or online, and I have that carefully budgeted and tracked in an Excel workbook. My HOA dues and one utility are paid by check, as are some rare expenses. The only "cash" I need is for groceries and blow money, and I use my debit/check card (I have a monthly budget for this).

Envelopes are a great system for a lot of people but are little too tedious for my present needs.

[croland]

I've used an envelope system before, but I found it restricting sometimes and opt'd to use a double-entry application. I know several individuals who love it and it's easy to get up and running.

[AsiaTraveler]

We only do "envelopes" in areas that we historically overspend in- right now, gas, food & household purchases. I say "envelopes" because we don't use literal envelopes full of cash.

Our church's youth group sells scrip (gift cards where they get a small percentage of the face value) , so we purchase those at the beginning of the month for the grocery store, gas station, and walmart. That is most of the system, but there is some money still in the food budget. We keep track of that on the outside of the envelope where we store our gift cards (in the truck) and simply subtract (to the nearest quarter) whenever we make a non-gift card purchase.

It works for us and has really gotten on budget on track!

[Runaway Finances]

We developed a system based on cash. Determine the fixed expenses. Subtract fixed expenses from income and what is left is for discretionary spending. That amount is reduced to a weekly amount. You take that amount on Friday each week. That money is for all spending away from the home (haircuts, groceries, clothes, gas, eating out, entertainment). Not much to think about....just look in your wallet/purse as to how much cash you have, and if you have enough cash to buy what you want, then buy it if you want. The trick is to NEVER spend more than your weekly cash. Everyone that has followed the plan says it has changed their lives and marriages (they no longer fight over money). It is a pretty simple concept, but you still have to want to get your finances in order or it won't happen.