I have been thinking lately of switching to the cash method for my couponing. As of right now I am a debit card fanatic. I carry no cash. And by no cash, I mean no cash, no coins, nothing, nada, zip. Well.. you get the point. This makes it really easy to try and get every deal that is out there. If you use the cash method, you have a limit to what you can spend and something you need quickly becomes more important than just one of the deals!
The cash method is simple. You simply need to determine how much you are going to budget for groceries each week or month (this depends on how often you are going to reevaluate your budget.. monthly is probably best). Always take into consideration how often you get paid and how often you will be going shopping.
You will need an envelope for each week. $5 Dollar Dinners made some really cute envelopes out of scrapbooking paper! You can check out her post about the cash method here!
This is a good way to add some fun into it. No one wants to look at a plain white envelope when they’re thinking about saving money! Kelleigh Ratzlaff has some awesome envelope templates on her blog that are totally free and you can get as creative as you want with the paper you use for them! She also uses envelopes for gas, date night, gifts, haircuts, and fun.
After you make your envelopes for each week, determine how much money you will spend that month, you need to divide that amount into your envelopes according to how you have budgeted for it (whether just for groceries, or for everything).
If you are allowing $200 a month for groceries, then you need to put $50 in each of the four envelopes for groceries. Let’s say that you choose to use the cash method for gas and put $300 in an envelope for the month to use between you and your husband. It’s Friday, January 29th and your gas tank is on empty. You have used all of the money in the gas envelope and it’s two days until you put the next month’s money into the envelopes. What do you do? Well obviously have to put gas in your car. You can’t ride around on fumes hoping that you make it to where you need to be. So on the last day of the month when you reevaluate your budget, you will increase your gas budget for the next month because you went over for the last month.
Now as for myself, if and when I switch to the cash method, I think that any cash left over on the last day of the month I will put into my savings and see how much I have by the end of the year. Perhaps this could be my Christmas budget! You could always roll it into your next month’s budget as well and have a little fun with it! But that’s the fun part about it! You get to choose how you divide your money, what your envelopes look like, what happens to your money at the end of the month, and when you reevaluate your budget! And in the end you will be surprised at how well you stuck to your budget by not having that debit card so handy!