Get started using a cash envelope system with this step by step tutorial.
Do you find it hard to control your spending? Does the end of the month come and the money is already gone?
Do you wish you had an easy way to track your everyday spending to help you keep on budget?
I know when we started our debt free journey I needed help to control my spender ways.
What I’m sharing today was one of the most important ways we took control of our money and clawed our way out of debt. You can take control of your money too!
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I know I’ve talked about using cash for most of our purchases. I’ve talked about how it helps to keep us on budget.
But did you know it’s probably the one most important change we made when we decided to work on becoming debt free?
You read that right, using cash was one of the most important changes we made to become debt free only second to making and keeping a budget each month.
It changed the way we purchased items. It helped me to break my spending for entertainment cycle. It made us stick to our budget because once the money was gone it was gone.
If you’ve been putting off trying to use a cash envelope system, don’t put it off anymore! Below you’ll find how to set up a cash envelope system, that’s personalized to you and your family.
You’ll find why you need a cash envelope system and how it can help you stay on budget.
As well as resources to set up your own cash envelope system. With a printable cash envelope and register, you can get for free. See how below.
Don’t put off trying this great way to take control of your money one more day. At least grab the free printable envelope and register below and give it a try.
Why Use a Cash Envelope System
You might be thinking why do I need to use a cash to shop anyways, does it make that big of a difference?
I know I used to think that way too. I used to think I’ll be careful, I’ll monitor what comes out of the bank account, I won’t overspend my limits.
But there is something about handing over a card or swiping it. It doesn’t really register that you are spending money.
But when you have to hand over cash out of your wallet, that makes a big difference. Your brain registers that money has been exchanged. That you have just given up something, your cold hard cash, for the items you are purchasing.
I’ve found using cash does make a big difference in my spending and I think it can help you too.
How to Get Started with a Cash Envelopes
There will likely be a little adjusting time to using cash. It’s not as easy as swiping your debit or credit card. It takes a little planning. It takes a little calculating of what’s in your cart so you don’t overspend.
But it will make a difference if you try and stick with it.
Let’s get started on setting up your cash envelope system….
First, you’ll want to decide where you will pay cash. Make a list of items you purchase in person regularly. Things like groceries, gas, prescriptions, clothing, car repairs, etc.
Second, once you have your list of items you want to set up in your envelope system, it’s time to decide how much money to place in each envelope.
At our house, we place the amount of money we will need for the month in each envelope at the beginning of the month. My husband gets paid once a month so it works out best for us.
But if you get paid weekly or bi-weekly, it might work better to put just the amount you need each week or the amount you’ll need for half the month in the envelopes.
If you have a budgeted amount for each of the items it will be easy to figure out. If you don’t have a budgeted amount already you’ll need to estimate your spending.
Take a guess and place what you think you’ll need for the week in each envelope and see how it goes.
Third, each time you shop take the envelope you’ll need with you and use cash for your purchases. It’s really that easy.
I don’t actually carry my money envelopes anymore with me. I take out what I’ll need for each trip out to shop and place the remainder back in the envelope when I get home. But I’ve been using this system for years and most of the time I know how much I’ll need when I shop.
When you are starting out, it might be good to bring the envelope so you’ll have all the money with you if you need it. At least until you get better at estimating how much you’ll be spending on each trip.
Picking the Best Cash Envelope System for You
Now that you know how to set up your cash envelope system, you need envelopes. There are quite a few options to choose from. You can go super cheap to almost free to a purchased system. I’ve explained them below.
Regular Plain Envelopes
Now you can use standard envelopes and write each category on the front of the envelope. It works I’ve used plain envelopes for years this way. It’s the cheapest way to start but does have a drawback.
One drawback is if you want to track how much is in the envelope you need to write your total or how much you’ve removed with the new total each time on the envelope. When the envelope has been written on many times you’ll need to replace it.
Or you’ll need a tracking sheet to place in with the cash. This works quite well and the envelopes last longer.
Print Your Own Envelopes and Tracking Sheets
If you want something a little nicer, you can find a set of cash envelopes in the store. Each one has a register on the front and I’ve included extra register sheets to staple to the front or to place inside with the cash.
When you sign up for our email list, you can get a coupon code to get the printable cash envelopes for free. Just click the button to sign up below and we’ll send you the coupon code.
Purchase Ready Made Envelopes or Holders
There are a few options for purchasing ready-made cash envelopes. The Spendvelope cash envelope system or the Budget Keeper Envelope system are good options. They are color coded envelopes you can add your category to the front of. The Budget Keep Envelopes also are tear and water resistant.
A longer lasting option but a more expensive one than the printable above or the paper envelope system is the Divvy Up magnetic closure envelopes. This might be a better longer lasting options than paper envelopes, especially if you’ll be carrying them with you to the store.
Another option is to use a coupon holder as your cash envelope system. You can label each section and add the money each payday or each month. Use the printable registers that come with the printable envelopes above to track your spending. For a cheap cash envelope system.
There are a few wallets out there for using the envelope system. I have one from Dave Ramsey that has the cash envelopes. I don’t use it much because I don’t usually carry all our envelope money when I shop but it might be a good one for you.
I mentioned the Divvy Up Wallet with magnetic closure envelopes that looks like a good system. You can add which envelopes you need to your wallet and leave the others you don’t need at home.
The Savvycents Wallet is close to the wallet I use. It’s a wallet with built-in sections to hold money. As well as a zipper coin area and place for all your store loyalty cards too.
The Savvycents Wallet would be great to divide your money for the month if you like to carry it with you at all times or you could keep each section of money separate as you shop. And leave your envelopes at home like I do.
I almost always make more than one stop when I’m out shopping. I might shop for household items, stop at the grocery store, and get gas all while I’m out.
With the designated areas for each item, I’m buying I know how much change I have left over to put back in my envelopes at home. I don’t have to pull out the calculator and figure it out.
Finally, the Bella Taylor Wallet is probably most like the cash envelope system wallet I own. One section for cash that can be divided and another section for loyalty cards and drivers license.
This way I only open up the cash section when I need it and not when I’m grabbing my license or other store loyalty card. It keeps the cash secure under a zipper area.
Setting up a cash envelope system can be quick and easy. You’ll need to figure out, what categories you’ll be using the cash for.
Then decide how much you’ll add to each envelope and how often you’ll be adding the money. Maybe it will be once a month or once a week. It’s a flexible system and you’ll need to use what works best for you and your family.
Finally, you’ll need to decide how you’ll keep the money separated so you’ll know how much money you have for each category of spending. Hopefully, one of the options I mentioned above will be the perfect match for you.
Even if you don’t plan on making your own envelopes from the free pattern above, you might get the printable pack to have the printable registers. The registers can help you track how much you are spending and what the total amount is in each envelope.
I know the cash envelope system really helped to change our financial outlook and I know if you give it a chance it can really help you control your spending too.
You can get started with the printable envelopes for free when you sign up above for just the cost of printing them and give it a try.
I would love to hear your tips! What have you found helps you to stay on your budget? Leave a comment below.
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