I’ve been using a cash envelope system for our grocery budget for a whole 52 weeks now. It has worked beautifully for our family! Before we started using cash to buy groceries, 1) I was more likely to go over-budget, or 2) sometimes the “grocery money” in the bank account would get used for something else, and then there was no money for groceries come shopping day. We’re both glad we have a better system in place now!
The way the system works for us is that Tad withdraws our weekly grocery budget (as well as our tithe) as soon as he deposits his paycheck each week. Every week I know I have a certain amount to spend, and when it’s gone, it’s gone. I have to live within our means!
Here’s the fun part, though… whatever I don’t spend from that amount each week goes into another envelope. This “grocery surplus fund” allows me to make special purchases (bulk foods, strawberries, stock-ups on sales, etc.) that I ordinarily wouldn’t have the money for on a weekly basis. I consistently come in under budget each week now (by the grace of God, for sure), and I enjoy getting to save those extra few dollars for future grocery purchases.
I know lots of other people use the cash envelope system for all of their budget categories, but for now, this is the one category that really makes sense for our family. Every family is different, though!
I used bank envelopes (the ones they give you your cash back in) all of last year, but I got tired of how drab they looked. I decided to replace them with cute envelopes made from scrapbooking paper!
To make your own…
-unfold a bank envelope carefully
-trace the outline of the envelope on the backside of the scrapbooking paper with a pencil
-cut it out
-score (using a ruler) along the flaps so it’s easier to fold
-fold the flaps in just like the original envelope
-glue the bottom and side flaps
-label/decorate as desired
Do you use a cash envelope system for groceries? What about any other budgeted items? How does it work for your family?
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I love using the cash envelope system for our family! It has saved me a bunch. And I just made cloth envelopes that magnetically close and they are GREAT! They are so durable, pretty and I have more categories now…here are some pictures http://joshuaandstephanie.blogspot.com/2011/12/categories-in-my-envelope-system.html
We did cash only for a couple of months, and I LOVED it! But Keith wasn’t very excited about it. So for now I’m trying to be very strict about my grocery budget too, and everything else we just watch carefully.
Living within one’s means is not very popular these days. Just look at our national debt! Good for you for living responsibly. And isn’t it fun to have those cute envelopes to work with. Nice job. 🙂
such a cool idea!! I just bought a whole booklet of oversized scrapbook paper from T. J. Maxx on clearance for $3. So I may have to try this!
I really like this idea! We don’t really have the need to do the envelope system for other areas right now, but I’ve really been trying to stick to a grocery budget for all of our marriage. I think that having the cash would help me instead of just knowing how much I can use on the debit card. Thank you for sharing!
ok…i love these. even though i’m very frugal, we have not done a strict cash budget.ever. so last week I decided to start the challenge. i actually started cash for my groceries in the fall and love it! i am hoping i love it for the other areas too. i really like your idea of using the grocery money you don’t spend for grocery surplus. really great idea!
My family uses the cash envelope system too –for about 2 years now. It has made a big difference to us and our spending. Great job sticking to your goal, and I love the idea of the extra grocery money envelope from whatever amount is left over. Brilliant!
@LeilaThanks for your comment! We are considering switching to cash envelopes for EVERYTHING! Good to know that it’s worked well for your family.
I think I might give cash envelopes a go – at least for groceries and maybe clothing. I’ve always used my credit card (cleared every month) as it’s so good for tracking purchases but from a cash flow point of view, the cash envelopes are a better idea.
Thanks for sharing the tip about those very cute envelopes, too!