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I spent many years as a server in a family owned restaurant. This was my first job, and over my 14 year tenure, working for tips, I have discovered my BEST techniques for budgeting!

See, back then, the hourly minimum wage was $2.13 (you could definitely say I survived on tips alone!)

Managing cash tips to pay bills was hard- seeing the physical cash in my apron at the end of each shift invited spending.

The envelope method, taught to me by my family, allowed me to manage my cash and SAVE the majority of my earnings to pay for long-term goals!

In this post, I’ll teach you this envelope method, and explain how I have been able to make it work for me even after going “cashless” after direct deposit and debit cards made their way into my life…


Through using my envelope method, I have been able to do all of my favorite things, even at times in my life when my peers and co-workers couldn’t afford to.

I moved into my own apartment before any of my friends. I paid my own rent, utilities, car payment, insurance, groceries, phone service and still, I could treat myself. I even helped out friends and siblings financially in tough times- all because I followed this simple system.

I was told to label an envelope for every expense, and create a savings envelope too.

As soon as cash was in-hand from my job, before I even had time to hit the Starbucks drive-thru, my cash would stuff those envelopes.

I wrote a due date on some of the larger bills, so I could make sure those envelopes were filled first. The largest payment of the month was always the first to receive cash- followed by the second-largest and so on.

After each envelope received the given amount, the remainder went into a savings envelope.

Your saving envelope should be exciting! Write a goal on this one- “San Antonio Vacation” or “New Phone”…

Somehow, EVERY MONTH, the envelopes took care of the bills, and even though I made VERY LITTLE money then, often I even had money in the savings envelope to help out family and friends or eat out!

This method never failed, guys!

It does take discipline- you must fill the envelopes FIRST, no cheating! But I find this is the best way to accomplish my financial goals!

Today, cash is not used nearly as frequently. We mostly rely on electronic banking and direct deposit. Because I worked with cash for so many years, it was hard at first to ditch the paper envelopes. Once I stopped using cash and took on a debit card, I realized quickly that I needed to re-invent this system. My money was suddenly disappearing! 

I have written in other posts how important it is to have a relationship to your money. Debit and credit cards have effectively taken this relationship away- this is the main reason why it is SO DIFFICULT to stay in control of your finances!

It is much more difficult to touch and feel CASH, and to GIVE THAT CASH AWAY to someone else. Physically counting cash is very different than reading numbers on a statement. 

To stay connected to your money, (without cashing paychecks) you should adopt the electronic envelope-

Your first task is to find a good bank that allows you to have multiple accounts and transfer fund between those accounts monthly.

  -Read more about choosing a bank HERE

You will be naming your accounts, just like I labeled envelopes in the past with cash- Your money will now have “homes”. Instead of direct depositing your entire paycheck into a debit account, you will split your funds among several accounts. Your money will live in these specific places to pay for specific expenses.

I recommend starting with 3-4 accounts for your largest expenses plus a savings account.

Example: Rent/ Mortgage; Insurance; Car Payment etc..

You will allocate monies to these accounts each month and ROLL OVER any extra cash into an interest-bearing savings account.

Name your savings account after one of your long-term goals, such as “Bahamas Cruise”!

It WILL take a little extra time each month to manage your money-

Get the app (if your bank offers one) that allows you to check balances and transfer funds from your phone from one account to another. You will need to make sure the funds are available in each account as the expenses come due, HOWEVER,

The rewards are absolutely worth the extra effort!

This method is tried and true. I still use the envelope method today to manage my expenses, from mortgage payments to the kids’ educational expenses!

If you are one of so many out there struggling to get on top of your finances, I want to hear from you! Try The Envelope Method, and tell me how it goes! Send me an email if I can help you more, or leave a comment below, and don’t forget to subscribe- 

I’ll be launching an organizer with tutorial and worksheet to follow this strategy, so don’t miss out!

All The Best, Breezy


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