Envelope method?

[TheStreetCeo]

I was thinking of starting the envelope method to help bring down my families grocery monthly expense. We're pretty good at budgeting money but our grocery bill gets out of hand and after reviewing the expenses every month I can see we make our bi-weekly grocery trip and then there are a lot of little trips that seem to add up. So, I thought the envelope method might work. If I put $450 in cash at the beginning of the month, maybe it would help us spend less money and that mini trip to the grocery store might slow there by reducing our monthly expense. there are 5 members in our household.

Any thoughts to this approach?

[Broken Arrow]

I like the envelope system. I still use it to this day, even if I've moved on from physical envelopes, to spreadsheets, to dedicated personal finance software. Conceptually, it's still the same. Simple but effective.

As for input on how to structure the envelopes, I guess we would require more detail? Generally speaking though, it may be best to have an envelope for each bill, and for discretionary spending, an envelope for each family member. Something along those lines.

[TheStreetCeo]

All I need an envelope for is groceries. I don't have any debt other than my mortgage. My utilities are what they are. Discretionary spending is very low. For example my wife and I spend less than $25 a week on non essential items.
We've had a tough 5 years staying a float and have mastered the wants and needs with one tiny problem. When we want steaks on a whim, we buy steaks. If we want a treat, we buy a treat. If we want a "special" dinner, we go out and buy the ingrediants for a special dinner. For example last night, we hadn't thought about dinner until 6pm so I went out and came back with $34 worth of fresh veggies, chicken, brown rice, quinoa, and coconut oil. Nice healthy dinner but expensive. We had plenty of food around the house, I just wanted something different. That's the lion we need to tame.
BTW, if you haven't tried cocnut oil instead of veg. oil, you should. It's awesome with fresh veggies!

[littleroc02us]

I believe the envelope system would work great for Groceries. Just by splitting the $450 into bi-weekly envelopes. Using cash always forces you to stay within budget, as long as you remain discplined. We use the envelope system for spending money, going out money and Target money. It works great because we cannot overspend. I think we may have to start an envelope for groceries as well.

[Debt Vigilante]

I never really got into the envelope system. To me, it just seems like if I budget a certain amount for something, I simply spend what is budgeted - no more. If you know you want to spend $125 per week on groceries, just don't spend more than that. Granted there are no kids in the picture, my wife and I know exactly what we are getting when we go to the store. It has seriously gotten to the point where we can estimate within about $5 how much we are going to spend any given week.

Now there are miscellaneous expenses like: soap, toothpaste, deodorant, toilet paper, paper towels - you get the idea; for those we have a separate account. Even if they are purchased at the same time as our food, I use the receipt to separate the food vs misc expenses.

[TheStreetCeo]

Now there are miscellaneous expenses like: soap, toothpaste, deodorant, toilet paper, paper towels - you get the idea; for those we have a separate account. Even if they are purchased at the same time as our food, I use the receipt to separate the food vs misc expenses.

Speaking of that, I lump all that stuff into our "grocery' bill. I have a hard time understanding why those purchases are separated from that grocery bill. I understand their not groceries, but when do most people buy that stuff? When their gorcery shopping right? So what are the benefits to separating that expense?

[ActYourWage]

I find the grocery bill to be the hardest to really keep consistent in my household. While money and emotions play a big part in how one handles money, this is especially true when one is dealing with money, food and emotions. Food makes us feel good and it is very easy to listen to our emotions when buying food. It really boils down to being discipline and having a plan with our buying. The same is true with working out and eating right. I do believe the envelop system would help one be more discipline and allow them to better stick to the spending plan.

[Debt Vigilante]

Speaking of that, I lump all that stuff into our "grocery' bill. I have a hard time understanding why those purchases are separated from that grocery bill. I understand their not groceries, but when do most people buy that stuff? When their gorcery shopping right? So what are the benefits to separating that expense?

I used to do that, and the ONLY reason I changed to the system I am on now is because I wanted to see how much it cost us to eat well each month. My wife and I are more in to healthy eating, and I wanted to see what the food bill was like compared to some people in my circle of friends.

But you are right, unless you have some motivation or desire to separate the costs, I would put them in the same budget category. Its a personal thing for me.

[TheStreetCeo]

That makes sense. My family and I east healthy too. I almost threw up when I saw how much coconut oil costs. 9 bucks for the size of a peanut butter jar. thats crazy, but it's better for you than vegatable oil.

[Debt Vigilante]

That makes sense. My family and I east healthy too. I almost threw up when I saw how much coconut oil costs. 9 bucks for the size of a peanut butter jar. thats crazy, but it's better for you than vegatable oil.

LOL...the wifey and I settled for a nice medium - canola oil.

[hopefulfirefly]

I've heard all the chatter about coconut oil, I need to get some! I'm a vegetarian so I love new ways to spice up my veggies!

I'm sure you do this or have done it or don't do it by choice...but...as a suggestion to keep your grocery bill down, coupons! I spend very little time each week (perhaps 45 minutes a week) organizing coupons & literally save hundreds a month. I have a list of "must be free" items that I will not pay a single penny for (toothpaste, toothbrush, shampoo, etc.) and it's really cut down on our costs. Just a thought

[snafu]

Kudos on getting so many spending categories under control. $450. for two adults seems high so I wonder if a menu plan would end dinner time dash to the grocery for $34. unplanned expenditure. it's not written in stone, you can change meals around but you will have items on hand and save your wife a ton of stress...what shall I make for dinner as she turns the key in the door. Likewise, with plan-overs one prep allows for two healthy, enjoyable meals.

[snshijuptr]

I would recommend planning out meals for the week instead of the envelope system. By writing a list and sticking to it, you can still have your favorite meals without having "treats". You could also combine the two methods. Just make sure youndont get frustrated and "cheat" by eating out to satisfy your cravings.

[TheStreetCeo]

LOL...the wifey and I settled for a nice medium - canola oil.

Nice, there's nothing wrong with that either!

[TheStreetCeo]

I would recommend planning out meals for the week instead of the envelope system.

Not a bad idea. I've heard it before but never really consdier it. I bought the Quicken Home and Business software that was recommended by Debt Vigilante and that tracks the spending a lot better than i thought so i kind of scraped the envelope idea.

This idea of planning out the meals for a week would work well I think. Not to mention the wife won't have to call me every stinking day while i'm at work and ask me what I want for dinner.