Y’all, I have a confession to make. I tend to ball out of control.
It’s bad. But I just love shopping.
The only thing that helps me be a baller on a budget is Dave Ramsey’s envelope system. When I first tried this system I saved about $2K in a couple months. Granted, I was living with my parents at the time so the only financial stuff I had was my car, car insurance, phone and any credit card debt I had racked up. But with using this system I was able to pay everything off and save money before Corey and I moved into our own home.
Once we moved in I got a little too excited about all the fun house stuff I could buy. All the money I had saved was spent and I was back to using credit cards.
I’m not comfortable with the situation I’m currently in so I need to get my booty back in check and get back on this envelope system. If you’re in the same boat as I am, keep on reading!
What you need:
Envelopes (I bought mine at Staples)
Silhouette Machine & Vinyl (This is optional, I used my Silhouette to make labels because my handwriting sucks)
Upkeep (paper towels, tp, dish soap, dog food, etc.)
Misc. (I normally put a $20 in there for emergencies)
Your envelopes can be for anything you want, buy they should be categories that you need to control your spending in. In Dave’s envelope situation they have gas as a category. I personally think it’s a pain in the butt to go inside and pay with cash when I can just swipe my card but if you’re into that, go on with your bad self.
How I use the Envelope System
I get paid every two weeks. The first thing I do is pay all my bills that are due in that time period; phone, electric, insurance, car, loans, credit card payments, etc.
Once all the bills have been paid I can see how much I have left over for all those envelope categories. I also keep in mind what I have planned in the next two weeks and what I may need.
For example, if it’s a friend’s birthday and I know we’re going to go out to dinner I’ll put some money in my restaurant envelope. Or, if I’m running low on toilet paper and laundry detergent I’ll put some money in my upkeep category.
Now, sometimes random things come up and someone may ask to go out to lunch or dinner or whatever. That’s normally when my misc. envelope comes in. I’m a planner and tend to make plans way in advance so this doesn’t happen often, but it’s there just in case.
Once the cash is Gone, it’s Gone
Say I gave myself $40 in the beauty/clothes category. I go to Ulta, find a couple liquid lipsticks and spend my $40. I can not buy any more beauty products/clothes until the next time I make my budget. But, maybe I only find one liquid lipstick I like and I have some cash left over by the time my two weeks are up. I can reward myself and spend it on something I want, keep it in the beauty/clothes category or roll that money into another category.
How to Keep Track
There are a ton of budget apps out there, I just downloaded Intuit Mint to help me keep track of my spending. You can connect all your credit cards, create a budget and track your spending Fo Free.
That’s all for today folks. Have any of you used the envelope system before? I’d love to hear about how it works/worked for you or if y’all have any other tips and tricks that help you be a baller on a budget.
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