5 Easy Tips to Master the Cash Budget Envelope Wallet System

Rachel | Linin Up Ducks
by Rachel | Linin Up Ducks

If you are thinking about using the cash budget envelope and wallet system, or you tried it before and it didn’t work for you, it may be time to try it again and make it a success this time around.

We’ve been stuffing cash envelopes for over a decade so I have learned a few things along the way. If you want to learn how to start the cash envelope system, I have five super important tips to get you started.

1. Do not carry all of your envelopes with you

Do not keep all of your cash envelopes with you at all times. I made this mistake when we first started this system.

We were out doing Christmas shopping one year and I had all my little envelopes with me in my purse and I left my purse at the mall – with about $800 in it!

We rushed back to the mall and my purse was exactly where I left it with all the money inside. But that taught me a very valuable lesson.

If you have all of your envelopes with you, it is also too tempting to pilfer cash from your other envelopes. It’s very tempting to pilfer from your sinking fund, which is the money you are saving for an upcoming event.


2. Plan your days

How do you make this budget work if you can’t carry all of your envelopes with you? Planning.

Every day plan what you need with you before you leave for the day. Just grab the particular cash envelopes you will need when you run your errands.

You won’t have any extra cash with you to tempt you into buying something you don’t need.

3. Have a local bank

So, this may sound odd, but if you use the cash envelope system, you have to take cash out of the bank to put into the envelopes, but you usually can only get $20 bill increments from an ATM.

Having a local bank helps you to break down what you need in cash by letting the teller know what types of bills you’d prefer, rather than relying on the ATM.

4. Always keep “oops” cash with you

This has been our key to success to stop us from transferring money back and forth and to stop us from using our debit cards. We each keep $25 of oops money in cash in our wallets.

It comes in super handy when I need my husband to stop by the store to pick up groceries.

So if he spends $5 of his oops money on groceries (since he doesn’t have the grocery food envelope on him), I just take $5 out of the grocery envelope and replenish his oops envelope.

Cash in envelope

5. Never, ever pilfer your grocery budget

This very important tip strictly pertains to your grocery envelope. Never, ever steal or “borrow” from your next week’s grocery money.

You will always need that weekly budgeted amount for groceries and if you borrow from the next week’s fund, you’ll end up being short for the next week and you will have nowhere to pull the money from.

Never, ever, ever pilfer your grocery budget. It’s important to be very, very strict with your grocery envelope.

Another way to make sure your grocery budget stretches is to meal plan. I hate doing it, but it’s a necessary evil to save money and budget.

It keeps my budget in check while feeding a family of six on $600 a month, and usually I have money left over.

Bonus tip: Save, save, save

Have a purpose in mind. This cash budgeting method has the ability to save you a lot of money.

Having a designated purpose for all of your leftover cash is important. It will keep you from having all that leftover money from flying out of your hands. You will find that you’ll be able to save up for what you need very quickly.

Those are my top tips for finding success with the cash budget envelope wallet system. I hope these warnings and ideas help you stay on track.

Let me know if you have any other vital tips to keeping this system successful.

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