Budget Envelopes

15 09 2010

Rolist Financial Group wants to share with everyone our “Budget Envelopes”.  By no means is this a fancy organization system.  In fact, it only set us back a whopping $2 from Ebay.

Each and every time we leave the house this puppy comes along with us.  It’s a permanent item in my purse and is just one my tools of the trade.

Let us dissect the idea of budget envelopes.

What are Budget Envelopes and how can they help me?

  • Budget Beginner.  Everyone should implement a spending plan into their lives and budget envelopes allow you to follow through with this plan.  At the beginning of every month, account for all money with a Budget Chart.  
  • Create Spending Categories.  Each envelope should be named (i.e., Food, Gas, Postage, Eating Out, etc.).   You will see from the above photo, my Budget Envelope organizer provides category samples.  A rule of thumb would be to categorize expenses that are paid for with cash.  Using your budget chart, allocate how much money will go into each envelope.
  • Curbs Spending.  The idea behind using budget envelopes is to curb your spending.  Ideally, you should only spend the allotted amount within each envelope.  This translates to: when the money is gone, it’s gone
  • Spend Only What’s in the Envelope.  As stated above, budget envelopes help curb spending.  Your goal is to spend only the cash inside each envelope for the month.  You will learn how to stretch the dollar!  If, by chance, you spend all the money within an envelope prior to the month end, you need to fight the temptation to charge or withdraw money from savings.    Reign in your dedication to save more and spend less.  You may struggle in the beginning but the end result is more money in your pocket. 
  • Leftover Money.  Redepositing any leftover envelope money into your savings account should be your goal.  Sometimes I love seeing just how much money I won’t spend!  It’s a great feeling depositing that unspent money.

Since switching over to a cash-only-household, our spending has been curbed tremendously.  With that said, our savings grew and money woes disappeared!  Everyone should welcome a budget/spending plan into their lives – it truly pays off.

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