Thursday, June 02, 2016

Two Years with the Envelope System

I started using the envelope system on my final payday of May 2014, a full two years ago now. It's also been a year since I last wrote about my trusty system.

When I started, I had 11 different envelopes and an understanding that my budget might change from where I started. A year ago, I had 19, which is what I still have today. My 19 envelopes are:

apartment - I use this envelope to buy home decor type things or other necessary items for around the house. Recently I bought pillows. Sometimes I'll treat myself to a new candle from Target. (When did I become obsessed with candles?!)

car - I use this envelope for minor car expenses. Things like windshield wiper fluid, an oil change, etc. If I have a major car expense and have money in this envelope, I'll put it toward that so I'm not completely dipping into savings.

Christmas - I use this envelope to save for Christmas expenses all year. I'd much rather set aside a small amount every paycheck than use an entire paycheck toward gifts and everything else that seems to pop up at the end of the year.

clothing - I use this envelope for clothes, accessories, shoes, etc. This one is tough for me because I shop online. However, I try not to spend more than what's in my envelope and then just deposit the cash into my account. "Try" being the operative word.

dining out - I use this envelope to go out to eat, drinks included. This envelope is actually the reason I started budgeting because I was so appalled by the amount I was spending to eat out every month. Some months I do alright, other months I don't. My biggest struggle is that if a meal is over maybe $15, I'll just use my card instead because I know it will deplete my dining out envelope so much.

entertainment - I use this envelope to see movies mostly, but it would basically be for any activity. Concerts (which is rare) or anything else that I might do with friends that costs money. (Hey, it's adventure golf season now!)

Europe - I use this envelope to put money toward my dream of visiting Europe. Sure, it's not going to be a quick gain, but last year I wrote that I wanted to visit Europe by the end of 2016. Well, it's only June 1st and I just got back from England. Granted, I fundraised for that trip since it was a mission trip with my church, but I had just enough money from this envelope for all the extra things I bought while I was there. So it's back to square one on this one. The dream is still real!

gifts - I use this envelope to buy gifts and cards for friends and family. There are plenty of occasions that I need a gift or at least a card, so there ya go!

groceries - I use this envelope to buy groceries, and sometimes to eat out. It's better to "steal" from another envelope than use my card, right?

massage - I use this envelope to save for the quarterly massage I get. My knee pain has turned into knee and hip pain, so it's easier to save up paycheck by paycheck rather than take a lump sum out of one paycheck every three months. It's worked out so far because it's made what some might consider a luxury a very affordable reality for me.

medical - I use this envelope toward copays and prescriptions. Occasionally I'll have a bigger medical expense, but being 25 and relatively healthy, that's few and far between.

miscellaneous - I use this envelope for other stuff. More often than not, it's used at Target. (I mean, I need that $50 picnic basket for two right?)

oils - I use this envelope to buy Young Living Essential Oils. I quit the Essential Rewards program a few months ago since I was buying oils for the sake of buying oils--and spending $50 a month doing so--but now I have some money set aside just in case I need to restock on an oil I already have or want to try something new.

salon - I use this envelope to get my eyebrows waxed and get my hair cut. 

Starbucks - I use this envelope to fund my terrible Starbucks habit. The worst thing about my job is the closest Starbucks is a 2 minute walk away..if that.

sundries - I use this envelope to buy things like shampoo, deodorant, tooth paste, etc.

Super Bowl - I use this envelope to hopefully fund my pipe dream of wanting to go to the Super Bowl. Or some other awesome sporting event, but probably the Super Bowl. And probably in another 20 years.

tags - I use this envelope to save for my annual car registration. It came in handy in March, but it also got more expensive with my newer car.

vacation - I use this envelope to save some extra spending money for vacation. The purpose isn't to buy plane tickets or something like that with this envelope, but rather accommodate for the inevitable extra spending that I'll do on vacation.

It's been a great system that has worked out well for me for the last two years. I really can't imagine going back. In May, I actually didn't even use my envelopes because I left for England the day after payday and never went to the bank when I got back. It's nice to be back on track this month because I feel much more in control of my spending and aware of the money that I actually have and that I can and should spend on any specific thing.

The challenge for me has always been to actually stick to the allotted budget, but I'm hoping that my lackluster month of May will help me get on track and stay on track. Discipline has never been my strong suit, but I guess it takes discipline to change that, right?

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