This Post May Contain Affiliate Links

Money Monday || Cash envelope system

As many of you know I am a big fan of Dave Ramsey and one of the ideas he advocates is using a cash envelope system. Todays blog post is about how I implement this into my life. 

So firstly I don't use cash for everything. I use a combination of cash, debit card and direct debit/standing order to pay for my monthly expenses.
Rent and bills are paid by standing order so they are set to come out. Other expenses such as textbooks, clothes, transport which I pay less frequently and have annual budgeted limits I have envelopes for (though sometimes I use debit).
There are two main areas I always pay for with cash, my weekly grocery shop and entertainment/ eating out. These are also the two areas I am most prone to overspending. I take out my cash once a week, usually the day I do the food shop. Previously had tried using actual envelopes for these categories, but this was not helpful as I'm always changing bags and would forget to take them if I was just popping down the shop. So instead I use the separate compartments of my purse to separate the money into its respective categories. 

Within my purse there are three compartments. One I use for my weekly shop money, the other I use for my dining out and entertainment money and the back compartment I use to keep all my receipts and coupons. 
For other expences which I spend less frequently (i.e. clothing or books) I use my cash envelopes (and these are kept at home unless I'm going out to buy from that category. They are super easy to assemble and I usually print in greyscale to save ink(and pennies). Below is a link to the cash envelope printable that I use. Whenever I spend from these categories I will make sure to write down how much I spend and on what on the front to help me keep track. As I find for expenses I have an annual (not weekly) budget for because they are less frequent it is super easy for me to forget what I've spent. 
If I use my card to spend from one of these categories then I take the cash out of the envelope and deposit it into my account (or put it aside for next weeks budget and withdraw less cash the following week).

No comments