About a year ago, my partner and I — while broke and realizing that our Christmas money budget was about negative fifty dollars — had an idea. We grabbed a few envelopes, and on each one, wrote the name of a bill, the amount it typically cost, and when the bill was due. We put the envelopes in a stack in our room, and with every paycheck, we’d take a bit out to put in the envelopes.
Safely away from our bank account, our crappy spending habits, and our sad inability to balance a checkbook, we found that getting our monthly bills paid became significantly easier. With a better grasp on our spending habits, we were able to begin saving some of our money each month, and I have since been able to set up a payment plan for an outstanding student loan. It now has an envelope on the pile along with everything else.
We tweaked the rules a bit over the last year, but have a pretty good system going now. Our bills are almost consistently paid on time now, and we are spending less and saving more.
We began talking about renewing our season passes to Cedar Point (an amazing amusement park not too far away from where we live), which would set us back about $700. I figured, since the envelopes work for monthly bills, they would certainly work for non-bill related purchases, right? I wrote out an envelope titled “Cedar Point” and stuck in on the pile with the others.
But guys, these envelopes, they are taking over my life!
I have a fear of spending a large quantity of money on anything, opting instead, if possible, to save up slowly for it. Thus began my massive stack of small purchase envelopes that now reside in a pretty purple container in my office. From season passes to the zoo to a blender, from a new pair of running shoes to our wedding, I have envelopes for every purchase I may need to make in the future.
Some of them, like a new couch, are a one-time purchase. Others are sort of an on-going saving and spending envelope, like birthdays, chore money for my daughter, and Christmas. Every paycheck I get, I take out 40 dollars and break it up into five dollar bills. And then I put a fiver in the envelopes that I feel, at the time, most importantly deserve a bit of money. Forty bucks is a very small chunk of my paycheck, so much so that it is barely noticeable in the grand scheme of things. But it is helping me to save up for many purchases big and small. I feel as though I am, at least, making an effort.
Every time I go into my office now, I look at this neat stack of envelopes, and they are a constant reminder of the things that we need and want. And a reminder that I have, miraculously, found a system that really does help me save money.