Wanna know something crazy?

Two-thirds of Americans don’t have a budget.

Meaning that:

218 MILLION people are out there spending their money all will-nilly with no zero game plan.

That’s two hundred and eighteen million people who are not financially successful.

Because, let’s face it:

Without a budget, you are highly, HIGHLY unlikely to be able to afford your lifestyle, pay down debt, or save money.

But wait!  It’s all good, because:

Creating a budget for your money is hella easy. And, when you stick to a budget, you’ll definitely be able to:

  • • pay your bills with ease
  • • finally get out of debt
  • • actually deposit money into that savings account that’s been at $1.67 forever
  • • have extra money for your own personal spending

and, most importantly, your money stress with disappear.

Freaking sweet, right!?

What is the cash envelope budget system?

A cash envelope budget system is the process of using cash for all of your variable spending by placing a pre-determined amount of money in each of your variable budget categories.

Things like groceries, gas/transportation costs, household supplies, personal spending, etc.

For example, you might put $500 in your grocery envelope, $150 in your transportation envelope, $50 in your personal spending account, and so on.

Free Cash Envelope Templates

Your fixed expenses such as your rent/mortgage, car insurance, credit card minimums, etc., will be paid with direct deposit and online bill pay.  (Set up an automated budget for your fixed expenses with this simple guide.)


Here’s a quick overview of what we’ll be covering:

  • 1. Determine Your Why Factor
  • 2. Collect Your Financial Information
  • 3. Calculate Your Income & Expenses
  • 4. Cut Costs (if necessary)
  • 5. Set Up A Budget By Paycheck
  • 6. Track Your Budget

I’ve also created a downloadable cash envelope tracker and monthly envelope covers for you.  Simply sign up below to download it! 😊

Who Is A Cash Envelope Budget System Good For?

A cash envelope system is perfect for people who have poor spending habits and are getting into budgeting for the first time.

Here’s why:

When you only have a certain amount of cash to spend, you literally cannot go over budget.

Right, like, you can’t go to Target with $50 cash and leave with $100 worth of things.  But, on the contrary, with a debit or credit card, sticking to your budget can be difficult.


Using the cash envelope system for your variable spending is going to really benefit those who find sticking to their budget hard.

1. Determine your why

Ok so, we’ve already established this:

Every single person needs a budget if they want to be financially successful.

But why.

This answer will be different for everybody.   You can determine your why factor by asking yourself what budgeting will help you achieve in your life.

For example:

You might want to start budgeting to stop living paycheck to paycheck, to free up money to pay off debt, or to save more money.

Knowing your why is essential because it creates meaning for your purpose.  Without it, you’d have no motivation to continue budgeting.

Because let’s be honest:

If you do not have a plan for your money, how are you going to afford your blessed life?

2. collect your financial information

The best part about this step is that it’s super simple and shouldn’t take you much time.

You’re simply going to gather up your financial records, such as:

  • • a months worth of pay stubs from all sources of income
  • • a months worth of receipts for variable spending on such things as groceries, transportation, household items, take-out, etc.

Once you have those things we can dive into the budget!

3. Calculate your income and expenses

Before you can assign your income to different cash envelopes, you need to establish your average monthly income and expenses.

Here’s why:

If you’re never budgeted before, you probably don’t have a true picture of how much money you earn versus spent.  Thus, you don’t know if you’re living within or beyond your means.


To determine if you need to decrease your expenses before you start budgeting, calculate your income and expenses now.


Your Income:

Using the information you gathered during step two, calculate your total monthly income (after taxes) from all sources.

Monthly Income Template From The Budget Boss Binder™


For the purposes of this post, let’s pretend your total monthly income is $5,000.


Your Expenses:

Next, you’ll want to calculate your total monthly variable expenses.
For the purposes of most budgets, it’s helpful to break your expenses down into two categories:
  • 1. Fixed Expenses: Bills that you pay monthly, usually for the same amount and on the same date. (Rent/mortgage, utilities, cell phone, credit card minimums, insurance, etc)
  • 2. Variable Expenses:  Costs that vary in price each month and could be decreased or eliminated if needed.  (Groceries, transportation, entertainment, personal spending, etc.)
Monthly Expenses Template From The Budget Boss Binder™


If you aren’t sure what your monthly variable expenses are, begin tracking your spending in a financial planner to calculate an average at the end of the month.


Even though the cash envelope system is only for your variable expenses, you’ll want to include your fixed expenses for this step to determine if you’re living within or beyond your means – the most important step in every budget!

For the purposes of this post, let’s pretend our total fixed expenses are $3,500.


Financial Evaluation:

Now that you have you total monthly income and total monthly expenses calculated, you can do some simple math to see if you’re living within or beyond your means.

Simply take your total monthly expenses and subtract that number from your total monthly income.

For example:

$5,000 (total income) – $3,500 (total expenses) = $1,500

Financial Evaluation From The Budget Boss Binder™



If the number is a positive number, you’re in the green.

You should be able to afford your lifestyle with ease each month.  If you’re scratching your head right now wondering where all your extra cash has been going, then starting a budget is the best thing you can do for your finances.

If the number you calculated is a negative number, you’re in the red.

You cannot afford your current lifestyle and are spending more money than you earn.  Decreasing your expenses will be key to starting a successful budget.

But wait:

Everybody can benefit from decreasing their expenses, so don’t skip the next step even if you’re in the green!

4. Decrease your expenses


I know what folks in the green are wondering, “why should I decrease my expenses if I’m making more than I’m spending?”

Well, more money in your pocket is always, unanimously a good idea, right?

Decreasing your expenses will make sure that you’re not wasting money on stupid stuff and will free up money for the good stuff.  The important stuff. (Like vacations, duh!)
To decrease your expenses, follow these 3 steps:
  • 1.  Take out your list of expenses and mark each one with a star that you think you could eliminate or decrease.
  • For instance, could you find a company that offers internet at a lower cost?  Are you overpaying for car insurance?  Maybe you could refinance your mortgage or student loans for lower interest rates. Could you carpool and decrease your transportation costs?  Are you spending waaayy too much money on coffee at Starbucks each month?
  • You get the point!  Do the research and you’ll be ah-freaking-mazed at how much money you could be saving.
  • 2.  Sign Up For Truebill
  • When you sign up for Truebill, they’ll securely connect to your bank account(s) to analyze your spending, subscriptions, and recurring bill pay.  Then, Truebill will work its magic by helping you cancel unused subscriptions, negotiate lower bill prices, and improve your credit score.  In the last five years alone, Truebill has helped its users save over ONE HUNDRED MILLION DOLLARS!
  • You can sign up for Truebill here and be saving money in minutes!
  • 3.  Pay Off Your Debt
  • Credit card debt, car loans, and student loans will suck you dry every month if you don’t work hard now to pay off what you owe.  My two best recommendations for paying off debt quickly are to consolidate your debt into a low-interest personal loan or use the debt snowball method to pay off your debt.
  • Doing this will save you hundreds – if not thousands – of dollars over the course of your life.
Now, I’m gonna be real:
If you only do one thing after reading this post, let it be to decrease your expenses.
It is by far the simplest thing you can do to free up extra money in your life.

5. set up your cash envelop budget system

You made it! We’re finally ready to budget!

Grab these supplies to set up your cash envelope system:

To  get started, take a peek at the cash envelope template below to get an idea of how to set yours up.

Then I’ll go over what you’re looking at in more detail.

Free Cash Envelope Template

To fill in your cash envelope printable, follow these steps:

  • 1.  Calculate how much money you have to spend on your variable expenses after payday – (income – fixed expenses = left over for variable expenses)
  • 2.  Assign your variable spending money to each category (groceries $125, transportation $50, etc.) and place in appropriate envelope
  • 3. Fill out cash envelope tracker

For example:

If I am paid weekly and have a $500 monthly budget for groceries, I will place $125 a week in my groceries envelope.

Now, here is the most important part:

You MUST NOT take money from one envelope to make up the difference of overspending from another envelope.

For instance, if you have $125 for groceries and the cashier rings you out at $128, you have to put something back.  Do not take $3 from your gas cash envelope.

I know this seems crazy, but it is the only way to make your budget work correctly.

6. tracking your budget

Here’s the deal:

Most people forget the most important part of budgeting and then wonder why their budget failed a month after implementing it.

Tracking your budget is the most important part of budgeting.  If you have a budget, then you need to track it.

Because let’s be real:

If you do not track your budget, you cannot make sure that you are sticking to your budget.  And if you aren’t making sure that you’re sticking to your budget, your budget will fail.

Monthly Budget Tracking Templates


Since a cash envelope system is only covering your variable expenses, you need a way to track your other bills and spending.

When you use a budget binder to track your finances, you can check off bill payments as they come and set and track your debt repayment and savings goals.

So, you might be wondering:  How do you track your budget?!

Well, we developed the Budget Boss Binder™  to track any and all budgets, debt repayment, savings goals, bill payments, and more.

The Budget Boss Binder™ is a printable and digital budgeting planner designed to help you stick to your budget, pay off debt, save money, and create an abundant life.  The templates included are un-dated so you only have to purchase once to use this them forever.


Because you’re a valued reader of Who Says What, we’re offering our best selling Budget Boss Binder™ to you for 50% off when you click the button below!

Skip to the end? READ ME!

Ok, so I know this was a loonngg post.  So I get it if you skipped to the end.

I’m gonna be honest with you though:

You cannot set up a successful budget by skimming this post.  There’s just too many little details that you’d miss.

But, I will throw you a bone:

When you sign up for our free mini Budget Boss™ eCourse, you’ll receive a paced version of this post over the course of 5 days.  You’ll also unlock access to our free resource library which contains the budget by paycheck checklist and calendar template!

I will walk you through each step with mini homework assignments so that setting up a budget isn’t so overwhelming.

Simply use the form below to register for your free Budget Boss™ eCourse today!

Setting up a budget truly transformed my financial wellbeing and I want the same for you!

So, take action:

Gather your financial information, implement your budget, and track your budget for success.