Layout:
Home > Envelope System

Envelope System

November 27th, 2009 at 07:55 pm

Do any of you use the envelope system advocated by Dave Ramsey? Well, I do, but only for my regular grocery shopping and mad money. For more than a month now, I have been going to the bank and getting out a certain amount of cash to spend on groceries. For the first payday of the month, I always allocate more. That's when I stock up on stuff and when I also am usually out of a lot of stuff. At first, I was only doing this because my debit card number had been stolen and so I was without a card for about 10 days. Now, I see that this system actually works to keep me on track with my spending. Sometimes, things happen for a reason. I can actually predict within $5.00 or $10.00 what I will spend and not feel deprived at all. Before this, I think I probably spent a lot more because the money was "invisible." By the way, my mad money is money I can spend for snacks, lunches, etc. without having to worry about it.

5 Responses to “Envelope System”

  1. skydivingchic Says:
    1259366397

    Love the envelope system. For a long time I had never heard of the system, yet I naturally wanted to think of my money in "buckets." Then I found Mvelopes, which is based on the envelope system, but allows you to track everything electronically so that you can use your debit or credit cards. Everything just clicked - I could put my money in "buckets" without needing to open up a whole bunch of different accounts or track things manually on a bunch of spreadsheets. LOVE it!

  2. LuxLiving Says:
    1259410856

    I don't use actual envelopes anymore, but use the same theory as envelopes, Mvelopes, etc., in the You Need A Budget (dot com) software. I found that with cash in envelopes I was not trustworthy - I would borrow quite consistently from one envelope or another to make things happen. Not good.

    With the 'spending plan' software mentioned above I found I hated things going red (overbudget) in my categories when I overspent so it curbed me from bad habits fairly quickly and I learned to estimate what enough was in each category so I didn't underfund certain envelopes.

    Long before I used envelopes I used to use baby food jars to do budgeting with. That method also worked well with teaching my kiddos about the budgeting process.

  3. DeniseNTexas Says:
    1259413998

    My parents and grandparents used the envelope system for many years. Most people did, I think! And DH and I used Dave's system for about a year then got uppity and figured we could do fine without it. We did so much better when we used it and we both know its time to get back to it but we haven't done it yet. After our spending lately we really must. I think I'll talk to him about it this weekend, maybe tonight after I get off work.

  4. sharmanl Says:
    1259431635

    We used the envelope system for years. We used it for my husband's school tuition, our daughter's diapers, formula, entertainment, cleaners, dining out, groceries, and gas for the car. It is a great system to implement to live on a "cash" basis. I tell all my coaching clients to use the envelope system. I know it works. It helped us to stay debt free even with a child and a husband full-time in school. Using the system takes disclipine and self-control. No doubt about it!

  5. Broken Arrow Says:
    1259548929

    I've always used the envelope system, before I even heard of Dave Ramsey. And yes, I still use it today, although the money is no longer physically separated into actual envelopes anymore. Rather, they're virtually separate on computers, or specifically, my PDA.

    Physically, the entire lump of money still sits in my credit union account, all earning 3% APY. I track it down to the last cent too, so it works for me.

Leave a Reply

(Note: If you were logged in, we could automatically fill in these fields for you.)
*
Will not be published.
   

* Please spell out the number 4.  [ Why? ]

vB Code: You can use these tags: [b] [i] [u] [url] [email]