The Envelope System, for Beginners

[sinopa27]

thanks. Now I can get my envelopes together!!

[leighcat]

Greebo, I really like your idea and system. I have some questions. I get paid bi-weekly, and I get direct deposit. Should I stop the direct deposit? I get paid quicker that way but I don't have the cash on hand so it is harder to divide it up. Also, how do you do this system with bills that get paid online, over the phone, or by check? Do I just cash my paycheck and then add just the needed amount to my checking/debit account for those bills? Also, I may have to get into my ef to get setup at first then I will add the leftover back to my ef once I am all set. What can you recommend to me to get this system to work for me?

[Greebo]

Greebo, I really like your idea and system. I have some questions. I get paid bi-weekly, and I get direct deposit. Should I stop the direct deposit? I get paid quicker that way but I don't have the cash on hand so it is harder to divide it up. Also, how do you do this system with bills that get paid online, over the phone, or by check? Do I just cash my paycheck and then add just the needed amount to my checking/debit account for those bills? Also, I may have to get into my ef to get setup at first then I will add the leftover back to my ef once I am all set. What can you recommend to me to get this system to work for me?

Well, first, it's not my system or idea.

No, you don't need to stop direct deposit - just go to the bank and pull out the cash you need for the envelopes. Some things are easier paid electronically(IMO) - utility bills and the like - so you need money in the bank for that. You only do actual hands on cash envelopes for the categories where cash *makes sense*.

No, do not touch your EF to start doing this. When you get paid, figure out how much of THAT paycheck should go into the cash envelopes you do need (food, gas, clothing, stuff like that) and pull out that much cash to fill the envelopes. You figure out how much cash you need by doing a proper budget where your fixed expenses are accounted for. If you don't have enough cash to fill the envelopes w/o touching the EF - YOU BUDGETED TOO MUCH - go back and lower the cash allocations.

[alotofgooddeals]

yes this was a wonderful explanation and even i was able to understand now to implement it....

[lyra]

Thanks for posting this..I really need it

[LADYBUG7788]

i'm new to this all

thank you for putting it into simple terms,i love the envelope system
it's great.

[ErikM02]

Great post, will def steal this

For my situation, I just started using money orders for everything

Way easier to keep track of imo. I'm terrible at having a checking account

[FLgal]

I started the envelope system on the 1st of June. I have to say, it is helping me realize that cash is a lot harder to spend(b/c you are counting whats left) vs. debit.
I only do it for groceries and gas, since we like to keep a paper trail for bills (incase they say "oh well, we didn't receive your payment").

In 8 days I have spent 65 on groceries and 62 on gas. I don't have a budget for gas (I estimated $110/two weeks), being its our first month. But groceries we are trying to keep it under $300/mth. My husband gave up meat, and I have been cooking bigger portions to allow for leftovers twice a week. I hate to cook, my kitchen gets hot and my kids run rampid. It's like Hell's kitchen. hahah

Good job everyone! I love this site and so happy to have found it

[GirlBoyGirl]

I hate to cook, my kitchen gets hot and my kids run rampid. It's like Hell's kitchen. hahah

Sounds like my house! LOL

Anyway, congrats and good luck! Sounds like you are doing great!