Tag Archives: finance

Bringing the Envelope Budgeting System into the 21st Century

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Finances are stressful! As a health coach I try to reduce my client’s stress. So, here goes.

Do you budget? You know that you make enough, and yet when that 3- or 6-month bill arrives the money is nowhere to be found? I used to work and re-work my budget, sit back and say, “Yep, plenty to cover everything.” But, when my quarterly insurance bill came around, why wasn’t it there?

A long time ago I used the envelope system, where you take your quarterly, bi-annual and annual expenses, and divide by 3/6/12 to get a monthly amount. I got paid twice a month, so I divided by 6/12/24 and put the resulting amount in an envelope every payday. When the bill was due, I had the money!

With the advent of debit cards and online banking, that quit working. I tried a sub-account budgeting ledger with columns instead of envelopes, but that was cumbersome.

Enter CommunityAmerica Credit Union. They allow me to link as many savings accounts as I want, and I can name them whatever I want … Just like envelopes! I currently have accounts for:

Animals:
standard wellness care, flea protection, boarding, emergency

Home Maintenance:
kind of a guess here, but partially educated.

Medical/Dental:
a projection, but extra doesn’t hurt

Taxes:
property, income and auto

Car Payment:
I don’t have one, but I might as well make it to myself so I’m used to it. Also, I can use it for repairs and maintenance to keep my little Matrix going for as long as possible! That’s where Cheshire Automotive comes in.

Emergency:
building up a few months of income

Miscellaneous:
gifts, clothes, books, charity, whatever

When my insurance or the property tax is due, the money is there! When it’s time for a repair … I can pay for it! I’ve found this a simple way to take control of my finances without having to constantly be paying attention to every penny.

If you struggle with a budget, check to see if your banking institution offers linked accounts. If not, and you’re local, swing by Community America!