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What is Cash Envelope Budgeting?

What is Cash Envelope Budgeting?

Cash envelope budgeting has enjoyed a rise in popularity in the past decade, but it isn’t some fancy new system. In fact, your grandmother is probably familiar with it - it’s the way many households budgeted before credit and electronic banking were available. The cash envelope system is so effective that it’s recommended by financial guru Dave Ramsey as a strategy to help people get their budget under control and pay off their debt. Read on to learn more about this system for savvy spending!

How does cash envelope budgeting work?

Essentially, you make a budget and decide on how much money you want to spend on each category - groceries, entertainment, gas, household, etc. At the start of each week or budgeting period, you withdraw those amounts in cash from your bank account and divide it into envelopes. 

When you go to buy groceries, you take money only from the grocery envelope. Gas comes from the gas envelope, meals out and movie tickets come from the entertainment envelope, and so on. Here’s the catch - when you run out of money in an envelope, it’s gone. You can’t borrow from other envelopes or withdraw more cash. You don’t refill your envelopes until the budget resets.
Millsboro Cash System Wallet

Why is using cash better for sticking to a budget?

This has to do with how our brains work. Electronic banking is convenient… a little too convenient, in fact. When you’re swiping a card, it’s difficult to visualize how much of your budget you’re using up. The money doesn’t feel real, so your brain doesn’t even realize how much you’re spending over multiple card swipes. 

Actually holding cash in your hands and watching it go away when you spend it helps your brain treat it like what it is - a finite resource to be conserved and used carefully.

Cash Envelope Budgeting

Cash envelope budgeting:

  • Holds you accountable.
  • Prevents you from overspending.
  • Teaches you to pay attention to where your money goes.
  • Makes spending money harder than just swiping a card.
  • Makes money tangible by allowing you to see, feel, and understand how much of it you’re using.

In short, cash envelope budgeting simply works! It’s a great way to get your spending under control so you can live according to your budget. This will allow you to pay down debt and start saving for what you really want, like a new car or a home.

Antebellum Canvas Cash System Wallet

What do I need to start cash envelope budgeting?

Like any new endeavor, it’s important to set yourself up with the proper tools to succeed. The purpose of cash envelope budgeting is to make it harder to overspend, but you want to make using the cash envelope system as easy as possible. Traditionally, you would use actual paper envelopes, which can get messy. Most people carry just the envelopes they need with them, but you may suddenly need to spend money from a different category. You may forget your envelopes at home and have to pull out the plastic or drive back. Difficulties like this can stifle your enthusiasm for cash envelope budgeting and will lead to defeat.

Instead, invest in a cash envelope system wallet. These wallets are designed for cash envelope budgeting, with slots instead of envelopes to keep your cash safely stored and organized in one place that goes wherever you go. The best cash envelope budgeting wallet on the market today is the Bella Taylor Cash System Wallet.

Antebellum Canvas Cash System Wallet

Find wallet peace with the Cash System Wallet

Not until Bella Taylor entered the cash envelope wallet scene did budgeters have access to a wallet that is durable and high quality, has enough secure storage space for all your cash, and comes in stylish designs. This clutch-style wallet features 8 interior, labeled slots that work like envelopes to organize your cash into budget categories, all in a securely zippered section. There are also easily accessible spaces for your cards, IDs, checkbook, and pen. A zippered pouch on the inside gives you easy access to your change. It’s the cash envelope budgeting system - without the envelopes!

If you’re ready to start cash envelope budgeting, take the first step by exploring our Cash System Wallet styles. The Cash System Wallet streamlines your cash envelope budgeting makes it easier to meet your financial goals!

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