You want to keep a better eye on your finances and save more money – it's easy to do with the envelope method.
Many people often run out of money, especially at the end of the month. In addition to renting, car and cell phone costs, you rarely want to do without something in your free time and so often only a few bills remain for the piggy bank.
The envelope method provides an easy way to divide the budget sensibly and keep an overview of the finances. You not only learn how to manage your money better, but you can also save a part.
The method comes from the American area and was spread in his books by the businessman Dave Ramsey. The principle of the envelope method is extremely simple: You divide your budget into different categories: groceries, shopping, leisure, etc. You pack the money earmarked for this in cash envelopes – one envelope per category.
At the beginning of the month you determine a certain amount of money for the respective category. You don't need an envelope for fixed costs such as rent or insurance premiums. Try not to define too many categories so that you don't lose track.
For example, when you go shopping, you just take the envelope and pay with that money. So you can see exactly how much you are spending and learn to stick to your budget.
As a first step, you should determine your monthly budget in order to implement the method in the best possible way. Important: Don't use up all of the money, put something aside.
I used envelopes in different colors for the different categories, e.g. red envelopes for food, blue for clothes or yellow for cars. Label them accordingly too.
When implementing it, you must never cheat, so only ever use that money for the respective category. If an envelope is already empty, you can analyze what potential savings there are. For example, you can do without branded clothing.
You can divide the amount for each by four and put it in an envelope. Then the envelope contains the budget for one week per month.
If you spend a lot of money every month, the envelope method will help you save. The categories allow you to better assess your finances and also better avoid impulse purchases.
