Are you a student that is away from your parents and home, who is having trouble in handling your weekly or monthly allowance?
Do you know how to budget your money so it could last a week? a month?
Do you always catch yourself buying things you don't actually need impulsively?
You wanna be financially literate?
Why not try the Envelope Method?
I only recently know that this method is called the "Envelope method". Actually, I have been practicing this method ever since I went to college, and boy I assure you! It works!
This is how I budget my 1000 peso weekly allowance:
130.00 - Transportation fare (back and forth) since I'm staying in a boarding house and I go home on weekends
500.00 - Budget for my daily meals (Sunday dinner up to Saturday breakfast)
270.00 - Miscellaneous (might be for school projects or bathroom necessities, etc.
100.00 - SAVE
It's only a simple breakdown honestly, but that's not what exactly the method is all about.
The term "envelope" makes sense when each of these designated percent of money are contained in different envelopes.
Well, it's not necessarilly should be ALL envelopes. It could be small purses, wallets, or pockets inside your bags!
For example:
The budget for my transportation fare is in my small pink pouch to keep it safe..
The budget intended for my meals is in my black leather wallet.
In that wallet, there is also an envelope containing all 100 peso bills I saved every week.
The rest of my money is in the pocket inside my school bag.
This is to make sure that you divided your money and put them to their assigned "envelopes" EXCLUSIVELY.
By exclusively, you will only get your money depending on what you NEED where each of these envelopes are labeled for.
Meaning, if you want to buy for your lunch, get it ONLY from your "Meal Budget" envelope (or purse, or wallet).
Or if you're coming home, get your transportation fee ONLY from your "Fare budget" envelope!
You get it now?
This is actually a smart way for you to track the remaining amount of your money and where you spend it.
It also subconsciously teaches you to be responsible for your budget, and be mindful on where you should spend it.
It will also make it more convenient during small emergencies! Like for example, the envelope (or wallet or pouch) intended for your transportation fare has gone missing! And the bus will soon stop in your station. But you noticed that you still have extra money from your "Miscellaneous" envelope, and it is just enough for your fare! You can get it from there!
Most importantly, this method allows you to SAVE MORE!
The "Savings" envelope should be like a sacred wallet. Which you STRICTLY shouldn't touch until it is enough to spend on what you intended to save it for. OR for sudden emergencies.
This method may sound ridiculous - having lots of envelopes or wallet.
BUT HELLO? THAT'S EXACTLY WHAT ENVELOPES AND WALLETS AND POUCHES AND HIDDEN POCKETS ARE FOR!
TO CONTAIN MONEY!
So try the envelope method now!
This is one small step for you to become financially literate!
Budget your money wisely! Spend smartly! SAVE more!
P.S.
We all have different breakdowns in terms of where our money are intended for. Honestly, the method is just adding the envelopes to make the flow of spending and saving your money more organized and traceable. Tehee🦋
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Until next time!