I compared cash envelope system vs. a budgeting app for 3 months

Tried the cash envelope method back in March after my credit card bill hit $800 one month. Switched to a free budgeting app in June and my spending dropped by $150 the first month. Having to physically hand over cash made me think twice, but the app's alerts were way more annoying and effective for me. Anyone else find that old school methods just work better for impulsive spenders like me?

3 comments

3 Comments

tara_jones9425d ago

See I had the opposite experience with cash envelopes, it just made me feel like I had a pile of free money sitting there and I'd blow through it faster. The app notifications bug me too but at least I can't just grab another twenty out of my wallet when I run out. Different strokes for different folks I guess.

emery1925d agoMost Upvoted

Honestly I used to be on your side. I thought cash was the only way to stop overspending and felt like apps just made it easier to ignore your balance. But I tried the whole envelope thing for a month and it backfired hard. I'd see the cash sitting there and convince myself a few extra dollars on takeout wouldn't hurt, then suddenly I was out of grocery money halfway through the week. The app notifications at least make me sit with the guilt for a second before I blow through everything.

seth68314d ago

Wait, is it really the tool's fault or is it just different ways we lie to ourselves about money? I've seen both sides work for different people, so maybe it depends more on your personality than the method itself. @tara_jones94 made a good point about different strokes, and honestly I think most budget systems fail because we outsmart them eventually rather than because they're broken.