Monthly Spending Envelope System

Everyone knows I'm really good at saving money - but I'm also really good at spending money.

Today I'm going to show you how to create a simple and easy envelope system for tracking your monthly spending. Things like groceries, gas, shopping etc. I am starting off this new year being better with my money and this is for sure going to help me.

I found this system years ago on Pinterest (I cannot find the original pin for the life of me!) and utilized it once upon a time. It worked very well for me, that is, until I stopped using it.

*Something to note first - we use credit for pretty much everything and then pay it off every month. That way we can take advantage of cashback rewards. When I'm using this envelope system, I am not using cash but you totally can

So here's how my envelope system works:

After writing down our monthly expenses that won't change (mortgage, utilities, cable, etc) we came up with a number that we need to keep our monthly spending to. This includes spending for things like gas, groceries, co pays, eating out, etc. I took our monthly number and divided it by 4.33 (52 weeks divided by 12 to get the average since some months have more weeks than others)

That number is my amount I get to spend each week.

Now it's time to grab your envelope (I prefer business letter size) and at the top (if placing sideways) write down the month and year.

Then, divide it into 4 sections for 4 weeks (doesn't have to be perfect, clearly mine isn't) and write each week in it's section

So let's just say my number is $300 - I will write that into each weekly box at the top. Now for every purchase I make in each week, I will need to write it down and keep track.

After each purchase, I make sure to stick the receipt into my envelope (which I keep in my purse) and when I get home, I record the amount and stick the receipt inside. This is also super helpful because now my receipts for the entire month will be in one spot!! (also make sure to record any online purchases!)

If at the end of each week there is money left, you can choose to either roll that into the next week, or save it. I will probably do a little of both :) At the end of each month, I file the envelope away and again, if I need to ever go back to a certain month and find a receipt, it's all there.


So what do you think? Good idea? For me, this is something I need to do to stay accountable and mindful of my spending.

*linking up with Jessi's Design