Envelope Budgeting & Quicken
Many different ways exist to create and track a budget. The key to successful budgeting is finding the system that works best for you. Many beginning budgeters find the old-fashioned envelope method the best, because it allows them to see where they are at all times. However, it can be difficult to use cash at all times, and combining that with another system may be a good solution.
Other People Are Reading
-
Quicken
-
Quicken is a money management program that allows you to create a budget and to balance your checkbook at the same time. Premiere editions also allow you to monitor your investing accounts. Quicken can save you time when you pay your bills and balance your checkbook. It is available for both PCs and Macs. However, it does not let you know how you are doing at any point in the day, unless you take the time to update it first.
Envelope Budgeting
-
In an envelope budget, you create an envelope for each budget category. At the beginning of the budgeting period, you place the budgeted amount in the labeled category envelope. Throughout the month when you spend money, you take that envelope with you to the store and make purchases only using the money in the correct envelope. If you overspend, you can transfer money between envelopes. The advantage of this system is that you cannot spend money you do not have since you are only using cash for this method. You will know as soon as you have spent all of the money in that category. However, it may not be practical to pay all of your bills with cash.
-
Combining Quicken with Envelope Budgeting
-
Most people who use envelope budgeting do a modified system. For set bills such as your mortgage or car payment, they will still pay with a check or online, but they use the envelope method for the areas they have a hard time sticking to the budget. For example, someone may have envelopes for clothing, groceries and entertainment costs. At the beginning of the month, he will withdraw the money for those categories in cash and place the money in the envelopes. Throughout the month, he will use the envelopes to cover those expenses. He will also be able to pay his bills online and easily balance his checking account and track any other spending he may have. The key to making a combined system work is to not use your debit card to cover expenses in your envelope categories.
Other Options or Resources
-
Budgeting programs are available that will balance your checking account and use the envelope method on the computer. MVelopes, Budget by Snowmint and Moneywell are all programs that apply the principles behind the envelope method to money software. However, you will not have the same experience since you are not using cash for your problem categories.
-
References
- Photo Credit Stockbyte/Stockbyte/Getty Images
