What do you do with the left over money in your envolope? This is my first month staying strict with the envolopes and there a few that might have some money left. Do you carry it forward? Do you add it to savings? Do you use it instead of adding more next month? I was planning to carry it forward but one category is babysitter and I hardly ever get one so I'm not sure I want to leave the money in it. So what do you do!
Left over money?
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The first few months I left it in the envie and just added the next month's money in there. For instance - if groceries had $40 left and my regular was $100 to put in there, it would then have $140 in it. This was just to make sure I didn't underfund the envies.
After the first few months then I added it to the snowball or savings or wherever it was needed.
After the first few months then I added it to the snowball or savings or wherever it was needed.
I believe the envelope system , much like starting a budget, is an evolving system over time. So this month you may be over and next month you may be short.
Document the amount that you have left and if it is the same next month, you know you have allocated too much.
Document the amount that you have left and if it is the same next month, you know you have allocated too much.
That definitely make sense!! I still have to rework some of my numbers but your so right something could come up and I might need a sitter more then once a month. I like the idea of a cap on it to, thank you!!
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Funny how when you start managing your money it's like getting a raise huh?
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I leave overages in there because I KNOW I'm going to end up using it. Examples are PETS. One week it's JUST dog and parrot food; the next it might be time to buy heartworm meds or an unexpected vet bill. GROCERY. One week might be a light week due to lots of inexpensive dishes, the next might be time to feed company with a higher cost. I find it sort of evens out throughout the year. I learned to leave extra overages in their respective envelope. I do that with my BLOW money too.
I don't do the envelopes, but I do budget. If I have any LO $, I put it in a box & use it as "rainy day fund". When it adds up, I take it to the bank. I put it in a special savings acct..which will be for my deductable for health insurance when we retire. (hubby older than me) AND-OH CRAP-that's a another thread in itself!!!
If I did an envelope system, I would determine a cap on the amount in each envelope, and then roll the money over into the next month. Once I hit the cap, I would start putting that towards an emergency fund, savings, debt, whatever is extra that could use the money.
I would document how much you are using each month, as well as how much is being rolled over, and then adjust the contributions accordingly.
I would document how much you are using each month, as well as how much is being rolled over, and then adjust the contributions accordingly.
I did use the envelope system, but was wary about carrying around so much cash with me. I now budget on the computer - any of my left over money right now is going to debt (although that is not technically 'left over money' but extra money). I think it's amazing idea to leave it there and put a cap on it. If I had left overs that's what I would do, then put to debt/savings after that. Good question!
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Depends what category is over, groceries I carry over in case I see a sale and stock up. All the others I put into a mini EF, my normal EF receives funds automaticly from my checking.
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Mine was BEF until that was established and now it rolls into credit card snowball.
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Once my desired max amount/envelope was met, I'd use the overage and make an extra payment to debt or add to savings (EF) or retirement (RRSP) If the overage was small, I'd pool the monies in a separate envelope until it was enough to make a substantial extra payment towards debt.
Another thought - you could just set it aside in its own envelope marked 'overage' for those smaller unaccounted for surprises where you don't want to touch the EF (though thats what its for)
Another thought - you could just set it aside in its own envelope marked 'overage' for those smaller unaccounted for surprises where you don't want to touch the EF (though thats what its for)
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I didn't use the envelope system, just a weekly budget (on paper) but when our income was higher, I took the extra at the end of every week, put half back in the "envelope" (budget line item) and put the other half into savings. It was up to me every week how to divide up the savings half - sometimes I put it all in the EF, sometimes I put it into several different savings funds I had going. It was usually small amounts but I also kept a running total and I managed to put aside €300 in about 10 months of doing that.
Ultimately I stopped doing that because with our income reduced, we now have many weeks where I can't put anything into the "envelope" so I need the extra to carry over.
Ultimately I stopped doing that because with our income reduced, we now have many weeks where I can't put anything into the "envelope" so I need the extra to carry over.
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