| How to keep from over-spending
Written by Janelle Wegner
Do you have trouble keeping track of your debit card receipts? Do you remember what you purchased on those receipts? Are you an impulse buyer? If you answered yes to these questions then maybe it’s time you started the envelope system. What is the cash envelope system? It’s a simple and easy to use method to control your spending and stick to your budget.
Using the cash envelope system was something I put off for a long time. I thought it was easier to make purchases with my debit card. I wasn’t the one balancing the checkbook every week so going through all the debit card receipts wasn’t a big deal to me, until Matt would call for me wondering what I purchased and sometimes I couldn’t remember. Several months ago I decided to give the cash envelope system a try and I haven’t looked back since.
Every month after Matt and I do our budget together, I make a list of what envelopes I need. I go to the bank, cash a check and divide all the money in to the appropriate envelopes. Each category has its own envelope, i.e. groceries, dining out, babysitter, gifts, etc. By doing the cash envelope system I can see how much I’m spending on each category. When the dining out money is gone then I know there’s no more eating out. The gifts envelope works about the same. Matt and I figure out what we will spend on birthday and Christmas gifts for each person we buy for. I total all the amounts for the entire year, then break it down into a monthly amount. I take that much out every month and place it in the gifts envelope. When a birthday comes up I just take the cash out of the envelope and go shopping. This works very well at Christmas time when we all typically spend a large amount of money on gifts. All the money is there in the envelope. This way you can also take advantage of the early sales!
Another thing I really like about the envelope system is I (we) don’t over-spend anymore and the impulse shopping has ended! Part of the reason for that is I request large bills when I go to the bank. It may sound strange, but it breaks my heart to break that 50 or 100 dollar bill. If I have a lot of 1’s, 5’s, 10’s or 20’s I’m more likely to impulse buy. The more small bills I have the more money I think I have! I guess it’s a mind thing.
The envelope system is a change that will be hard to accept but I challenge you to give it a try!