The Envelope Method – Old School Budgeting That Still Works

Before budgeting apps, there were envelopes – and believe it or not, this method still works like magic today.

The idea is simple: You divide your monthly cash into physical envelopes, each labeled for a specific purpose – groceries, fuel, fun, eating out, etc.

Why It Works:

  • It sets clear boundaries.
    You only spend what’s in the envelope. When it’s empty, you stop – no cheating, no overdrafts.
  • It makes your budget visible.
    Watching an envelope shrink helps you adjust your choices in real time.
  • It reduces impulse spending.
    There’s something about handing over the last €10 from your “fun” envelope that makes you think twice.

How to Start:

  1. Withdraw your budgeted amount in cash at the start of the week or month.
  2. Create labeled envelopes: Rent, Food, Transport, Fun, Misc.
  3. Put the planned amount into each envelope and use only

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