Cash Envelopes: Your Best Solution to Spending Less

Creating and sticking to a household budget is no small feat, especially if you are new to budgeting. Chronic overspending causes carrying credit card debt, so it’s crucial to master budgeting and learn to live below your means.

Good Debt vs Bad Debt

The cash envelope is a budgeting system that only uses cash to pay for specific cost categories. Each cash envelope holds the money you allocate to that category for the month.

Good Debt vs Bad Debt

What are Cash Envelopes?

Use cash envelopes to control discretionary expenses for these categories: – Groceries – Eating Out – Entertainment/Fun Money – Clothing and Accessories – Personal Care  – Home Purchases  – Spending Money – Gifts

How do You Use Cash Envelopes for Budgeting?

 Tracking your spending is the best way to figure out where your money is going. Track yourself every day for two or three months to get a clear picture of your spending habits.

Decide on Your Cash Envelope Categories

Next, head to the bank to withdraw the money to place in your cash envelopes. Withdraw the funds in congruence with when you get paid.

Pull Money Out of the Bank

Using cash envelopes will help you stick to your spending plan. Once your envelope is empty, you stop spending in that category until you withdraw more money after receiving your next paycheck or until the following month, whichever comes first.

Spend Your Money Carefully

There may be times when you have money left over in your cash envelopes at the end of the month.

Assign Leftover Money a Job


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