I actually think the envelope system is overrated for most people

I tried the cash envelope method for groceries last year in my small Chicago apartment, and all it did was make me feel guilty every time I needed to buy something like olive oil or flour. After six months, I switched to a simple spreadsheet tracking every dollar I spend (no categories, just totals), and my savings actually went up by about $120 a month because I stopped obsessing over little things. Has anyone else found that strict budgeting tools backfire and a looser approach works better for real life?

2 comments

2 Comments

finleyfox23d ago

Cash envelopes belong in 1992 with checkbooks and landline phones. My wife and I throw every expense on a cash back card, pay it off each month, and check our total spending once a quarter. We saved over $200 extra last year on a $75,000 joint income compared to when we tried dividing cash into paper envelopes for each category. The mental overhead of cash systems makes people spend more out of frustration at the restrictions.

carr.daniel23d ago

My mother-in-law tried cash envelopes for her garden center budget and ended up stuffing grocery cash into a coffee can labeled "seeds and soil" so she could buy more perennials. The whole system fell apart when she forgot which envelope held the cash for her cat's vet visit.