I've now been using the envelope system to budget my money for six full months. Unfortunately, I've missed the mark in terms of debt pay-off goals for 2014, but I did meet my savings goals. Fortunately, Thursday is a new year and with it comes new opportunities to save and become debt free. I've decided to set new goals for 2015, starting where I am now so I don't have a continued sense of failure every time I crunch the numbers at the end of the month.
Before I go on, let me just say: Don't spend aimlessly on a credit card. While it might seem like "free money" at the time, it's actually more expensive money thanks to a little thing called interest. I'll acknowledge that my credit card debt might be a fraction of other Americans', but not one penny was worth it. It's easy to get caught up in "needing" this and "needing" that, especially in the world of blogging and social media. But you should never spend above your means. Credit cards aren't a terrible thing. It's a good way to build credit, but if you want a good credit score, pay off your bill in its entirety each month. That's a good way to keep yourself from spending more than you can afford. My bank offers more rewards points for spending on a credit card than on my debit card, so it wouldn't be a bad idea to use my credit card if I were immediately transferring the exact sum and keeping my credit card balance at $0.00. That's not what I was doing and I have since found myself in a hole I don't want to be in. By all means, use me as an example. Don't spend above your means, especially on a credit card.
I think December has been my biggest test of my budget so far. I have an envelope specifically for gifts, but by the time December rolled around, it wasn't as full as I had hoped (or as it will be next Christmas). Luckily, my dad's side of the family has decided to make last year's Ivory Elephant a new tradition, which has cut down on all our spending. Instead of doing a typical White Elephant, we buy something people will actually want and use, so we just have to buy one gift! I had to dip into some other funds to cover some of my Christmas gifts, but I was able to keep the total spending fairly low between going in on gifts with other members of my family, shopping the sales and with coupons and discount codes, utilizing free shipping opportunities, and buying some gifts early.
But of course Christmastime also comes with an increase in activities. Now that I look back on the last month, I'm sad that I spent so much time working and wasn't able to participate in some of the things my friends and family did or even have more nights at home just to watch Christmas movies and relax. I was still able to do plenty, but it has certainly been a busy season. Because November was also extremely busy for me, I wasn't using much of my entertainment envelope, and I had some extra cash to spend this month. That helped me not feel overwhelmed when it came time to pay for some seasonal activities. I also instituted a 30 day spending freeze after Thanksgiving, but that was mostly to keep myself accountable and not grab something from Chipotle or Chick-Fil-A on my way home from lunch. I wanted the money in my eating out envelope to be strictly for going out with friends and not eating take out on my own. I'm actually really proud of myself because I mostly did it. I completely forgot about it while I was in the drive-thru at Chick-Fil-A one day and it was too late to turn back.
Now that the holidays are over, I'm pretty pleased with the amount that I spent, because I don't feel like I'm in any worse shape financially than I was before the holidays. In fact, I'm feeling pretty good about finances and about continuing with my envelope system through 2015. I honestly cannot imagine going back.
I think December has been my biggest test of my budget so far. I have an envelope specifically for gifts, but by the time December rolled around, it wasn't as full as I had hoped (or as it will be next Christmas). Luckily, my dad's side of the family has decided to make last year's Ivory Elephant a new tradition, which has cut down on all our spending. Instead of doing a typical White Elephant, we buy something people will actually want and use, so we just have to buy one gift! I had to dip into some other funds to cover some of my Christmas gifts, but I was able to keep the total spending fairly low between going in on gifts with other members of my family, shopping the sales and with coupons and discount codes, utilizing free shipping opportunities, and buying some gifts early.
But of course Christmastime also comes with an increase in activities. Now that I look back on the last month, I'm sad that I spent so much time working and wasn't able to participate in some of the things my friends and family did or even have more nights at home just to watch Christmas movies and relax. I was still able to do plenty, but it has certainly been a busy season. Because November was also extremely busy for me, I wasn't using much of my entertainment envelope, and I had some extra cash to spend this month. That helped me not feel overwhelmed when it came time to pay for some seasonal activities. I also instituted a 30 day spending freeze after Thanksgiving, but that was mostly to keep myself accountable and not grab something from Chipotle or Chick-Fil-A on my way home from lunch. I wanted the money in my eating out envelope to be strictly for going out with friends and not eating take out on my own. I'm actually really proud of myself because I mostly did it. I completely forgot about it while I was in the drive-thru at Chick-Fil-A one day and it was too late to turn back.
Now that the holidays are over, I'm pretty pleased with the amount that I spent, because I don't feel like I'm in any worse shape financially than I was before the holidays. In fact, I'm feeling pretty good about finances and about continuing with my envelope system through 2015. I honestly cannot imagine going back.
