7 Of The Best Cash Envelope Wallets For Budgeting Your Money

Cash envelope budget: how it works

The first thing you’re probably wondering is “How do you start a cash envelope system?”

First, you’re going to set up a budget. You might already have one (in which case this is going to be a lot easier). A very simple example: let’s say your take-home pay for the month is $3,000. Your normal monthly bills cost $1,200. You also put $300 aside each month for emergency savings and investments. That leaves you $1,500 for the other categories in your budget. You look at your normal spending and decide to put:

• $500 for groceries• $100 for gas• $100 for clothing• $150 for household (such as maintenance, cleaning products, etc.)• $100 for personal care (such shampoo, toilet paper, etc.)• $200 for medical• $100 for auto repairs and maintenance• $100 for dining out, movies, etc.• $50 for vacation fund• $50 for gifts• $50 miscellaneous

Second, you’re going to pay your regular bills like normal, whether that be online or with a check. You don’t need to withdraw cash to  pay your regular bills. These are fixed expenses that rarely change. 

Third, you’re going to make up your cash envelopes. You can use colored paper, buy a cash envelope wallet, or you can use the free printable cash envelopes below.

Fourth, you’re going to withdraw your cash to fill your cash envelopes. Let’s say you get paid twice a month. When you get paid the first time, you’ll withdraw half and add to envelopes. When you get paid the second time, same thing. Withdraw the cash and spread it between the envelopes.

Lastly, you’re going to stick to the money in the envelopes. That’s easy to say and harder to do. If you go to get groceries and forget your envelope, you have to go back and get it. Don’t use your debit card and guess how much is left. If you have $200 left in the envelope and your total comes up to $207…you have to put back $7 worth of groceries. 

You can’t shuffle money from envelope to envelope! This is a vital part of the cash envelope system. You have to curb your spending in some areas, no matter how hard it is. The whole point of the envelope system is to stick to your budget. 

However, if month after month you have extra money in one envelope and are always running short on another, you can adjust your budget. One reason that people fail with budgets is that they think they can never be changed. Budgets are flexible, living organisms that will change over time. 


#3. A6 Budget Binder with Cash Envelopes

4.6 rating, 2840 reviews 

Let’s chat about the A6 Budget Binder. Available in pink, this budget binder has an interesting design. There is a pen loop a cardholder, and you can easily spot the ticket pockets. You get 12 pieces of binder pockets, and these are waterproof and tear-resistant.

The 16 self-adhesive labels would make it easier for you to use them. The material for this product is PU. 

Check Price on Amazon

Step 1: Establish Categories and Limits

To use envelope budgeting, first establish spending categories for your budget, and then set spending limits for the categories.

The total amount for the spending categories must not exceed your monthly income.

To understand what categories might be useful for your budget, consider where your money goes. Try to list your common expenditures so you can group them effectively. For example, your categories may include:

  • Groceries
  • Gas
  • Health and grooming
  • Clothing
  • Dining out
  • Household items
  • Pet care
  • Children's items

Tailor your categories to your specific situation. Make as many categories as you need, but not so many as to be overwhelming.

Don’t forget to include irregular expenses, such as taxes, insurance, or gifts, and a savings category.

To discover what a reasonable monthly limit might be for each category, check your recent banking statements or receipts to get an idea of your usual costs. You can use that number or, if you’re trying to cut back, use a slightly smaller figure.

Free DIY Cash Envelope Option:

An easy and free DIY option for some cash envelopes is to just use the free envelopes that come with your bills, if you usually pay your bills online.  Then. you won’t have to recycle them! 

You can handwrite your categories, spending and balances on the back of the envelope, using the method I’ll be showing you next.

Different Ways to Organize Your Cash Envelopes

There are a few ways to hold on to, and organize, your cash envelopes:

Keep Them in Your Wallet.  If your wallet is big enough to house your cash envelopes, and closes securely, this is a great option if you want to keep all of your envelopes together, all the time.

Use a Cash Envelope Binder.  These guys are very cute, and hold all of your envelopes together with binder rings.  You’ll have to punch small holes into your cash envelopes to keep them securely in your binder. 

There are plenty on Amazon, in craft places like Hobby Lobby, or on Etsy:

via CraftzBySelena // Budget Binder Butterflies

Keep a Cash Envelope Organizer at Home. You don’t HAVE To keep every single envelope with you. In fact, if you are using cash, that’s a lot of money to have on you! God forbid your car gets stolen or something worse happens, and you lose all that money. 

You can use a small mail holder or rectangular pencil holder, or even just a binder clip to keep in your desk, and only take the cash envelopes with you that you will need for that shopping trip.

How does the envelope system help with budgeting?

The traditional cash envelope budgeting system makes it easy to stick with a budget, because you can't spend anymore once a specific envelope is empty for the month. If you stick to it, that puts a hard limit on each spending category.

How to budget to zero at months end

One reader question I received was: “How do I end the month?” You’re going to have cash left over in some envelopes. What to do with the cash depends upon the envelope. 

For example, you would let “auto repairs and maintenance” build up. Because when something needs fixed, it’s going to cost a lot more than $100. And won’t it be wonderful when the car breaking is no longer an emergency, but something you’ve already got the money to fix!

For categories such “groceries” and “dining out,” you have two options.

The first it to take the extra money and put it into savings.

The second is to simply let it roll over to the next month.

I highly suggest the savings option. Savings includes paying off debt, filling your emergency fund, and building your investment account. Your long-term goal is going to be able to live your retirement in comfort. Which means you’re going to need a big chunk of change. You might think that $5 left in groceries won’t help. But trust me, it will add up. 

How To Make Your Own Envelope Wallet

Not ready to invest in your own cash envelope wallet just yet? If so, that’s fine. Like I mentioned above, I budgeted using plain old white envelopes for years before I actually bought myself an envelope wallet.

If you aren’t ready to make a move to a cash wallet, you can start by making your own, or we have some cute cash envelope templates here!

Grab your cash envelope templates here!

Benefits Of A Cash Envelope Wallet

–You Can Easily Track Expenses

An envelope system allows you to track your expenses effortlessly. Each category within your wallet includes a space to track every purchase you make.

Yes, you will visibly be able to see where every dollar you spend goes.

Tracking your expenses and your cash is an essential part of cash budgeting. Your wallet allows you to do all of this.

–Prevent You From Overspending

When you’re cash budgeting, and you run out of money, what happens? You stop spending. If you don’t have the cash in your wallet, do you make random trips to Target? No, because you don’t have cash in your wallet!

This is why cash budgeting is so effective in preventing you from overspending because once your money is gone, you won’t have anything left to spend.

When you spend with a card, more than likely, you don’t track it. Money flows right out of your bank account, most of the time without even realizing it. Before you know it, you’ve spent your entire paycheck.

Having a wallet that keeps you organized will prevent you from overspending.

What About Emergencies?

If you have a crisis come up in the middle of the month or something happens and you have absolutely no choice but to shift your cash envelopes around, call an emergency budget meeting to talk it through.

If you’re married, talk with your spouse and figure out the best course of action, adjust the budget, and agree on it together. Both of you must be involved—it’s a joint decision. Or if you’re single, run the amounts by your accountability partner to get their input. 

What If I Pay Some of My Expenses Online?

Here’s the thing with the envelope system: It works better when you’re actually physically walking into a store to make a purchase. Shopping at the grocery store, going out to eat, getting a haircut or oil change are all times when using the envelope system works really well! 

You can still use cash envelopes for online purchases, but it does get a little trickier. Write the amount you’ve budgeted for on the outside of the envelope and don’t spend more online than the amount you’ve jotted down. Keep track of how much you’ve spent and write it on the back of the envelope, just like if you were balancing a checkbook.

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Benefits of using a cash envelope wallet

The main benefit of using a cash envelope wallet is that you can potentially reduce your opportunities to overspend. When you whip out your cash wallet to pay for a purchase, you’ll be able to see the direct impact of your purchase on the monthly budget. With a more tangible approach to discretionary spending, you’ll more easily see the consequences of your spending actions.

With this hands-on approach, you can bring more focus to your budgeting strategy. However, keeping all of your spending cash for the month in a series of envelopes can be confusing. A collection of envelopes can be difficult to track without the help of the cash wallet.

Luckily, there are many cash envelope wallets designed specifically to help you keep track of your budget’s envelopes.

Wrapping It Up

Bring more ease and comfort to your life by adding budget binders with envelopes. If you find it hard to save money and pay off your debts and you don’t want to follow technology and apps for some time, it’s time to consider the budget binders!

Pick yours today and share in the comments why you like it!