The “envelope” method of personal budgeting has been around for a long time, and for good reason. It is a simple and easy way to enact a budget, allowing people to take control of their personal finances. However, in our increasingly cash-less society, taking money out of the bank and sticking it into envelopes isn’t exactly practical. Not to mention envelopes stuffed with cash doesn’t exactly scream “secure.” Luckily, there are apps that take the envelope method and update it for the modern era.
What Is Envelope Budgeting?
The envelope budget allows people to easily compartmentalize and track their spending. It allows people to budget effectively while avoiding any serious number crunching. The gist of it is that you keep cash for different expenses in separate envelopes. Typical expenses include things like groceries, gasoline, entertainment, dining, etc. For example, let’s say you spend $500 a month on groceries. If you get paid every two weeks, you have to set aside $250 of every paycheck for groceries. That money goes into the envelope labeled “groceries” and can only be used for groceries.
If there is money left over in any envelope at the end of the month, you can roll it over or pop it in your savings account. The envelope method is an easy-to-understand system that allows people to keep tabs on how much money they’re spending.
1. Goodbudget
The Goodbudget app is well-reviewed and recommended by finance experts from Forbes, Lifehacker and more. Formerly known as EEBA (Easy Envelope Budget Aid), Goodbudget is an expense tracker that makes budgeting a snap. Goodbudget uses the principles of the envelope method but eliminates the physical envelopes. Instead of using cash, Goodbudget allows users to link their bank accounts to the app. Users can then create digital envelopes and allocate money from their bank account into these “envelopes.” This allows users to quickly and easily keep track of their expenses without having to pull cash out of the bank.
The Goodbudget app has default envelopes for regular expenses like rent and groceries. Users can also add additional envelopes and customize them for irregular expenses like saving for a vacation. In addition to being available on both iOS and Android devices, users can also use the Goodbudget website to maintain and edit their budgets. The website is also home to guides and instructional videos to ensure you get the most out of the app.
The Goodbudget app is available in both a free and a subscription-based version. The free version allows users to configure up to ten envelopes while supporting only two devices. Subscribing allows users to create as many envelopes as they wish, as well as supporting up to five devices. The free version doesn’t have any ads, so if you don’t need the additional envelopes, the free version should suit most.
2. Mvelopes
Like Goodbudget, Mvelopes is an app that helps users get in control of their finances with the tried-and-true envelope method. The Mvelopes app can be linked to a variety of financial accounts including bank accounts, credit cards, PayPal, and more. Adding these accounts in the Mvelopes allows the app to automatically track your spending. In addition, users can input data manually for any windfalls or other accounts that are not supported.
Mvelopes has three different service tiers: Standard, Premier and Money4Life Coaching. The standard version is free and allows users to link their accounts and create up to twenty-five digital envelopes. Like Goodbudget, Mvelopes tracks spending and gives a good overview of your spending habits. Premier costs $9.95 a month and allows users to create an unlimited number of envelopes and gives access to a 24/7 live chat support. Money4Life Coaching gives users access to personalized advice to attain financial goals. Money4Life pricing is based on an individual’s needs, so it will vary from person to person. Mvelopes is available for both Android and iOS devices, and also has a desktop app for Windows and macOS.
3. SimpleBudget
If you’re in the market for an app that is a little simpler than the ones mentioned above, look no further. SimpleBudget doesn’t have the most attractive interface, but it does work. In addition, the app is completely free. This is in stark contrast to the others that lock users out of certain features unless they pony up the cash. That being said, SimpleBudget is ad-supported, so you’ll have to deal with that minor annoyance.
SimpleBudget lives up to its name in practice. Users create their envelopes and set the budget for each one. As a user spends the money, they simply make the deductions within the app. One big downside to SimpleBudget is that it doesn’t link to any of your accounts. This means that users must input funds received or spent manually. While this requires some discipline, there is one upside: Since the app doesn’t connect to the Internet, it means that all data is stored locally on your phone. For those concerned with privacy and security, this can be an advantage that they are happy to sacrifice convenience for. Unfortunately, SimpleBudget is only available for Android devices.
What is your opinion of the envelope-budgeting system? Do you use any of the apps listed above? If so, have you found that they are helpful in managing your finances? Let us know in the comments!
FAQs
Goodbudget helps you to stick to your budget limits without the hassle of keeping actual cash in physical envelopes. It's available on the Web, iPhone, and Android. Save for big expenses, share household expenses, and budget on the go.
What budgeting app uses the envelope method? ›
Goodbudget helps you to stick to your budget limits without the hassle of keeping actual cash in physical envelopes. It's available on the Web, iPhone, and Android. Save for big expenses, share household expenses, and budget on the go.
What is the #1 budgeting app? ›
The best budgeting apps, ranked*
| Ranking | Platform name | Average app rating |
|---|
| 1 | Rocket Money | 4.3 |
| 2 | Simplifi | 3.4 |
| 3 | YNAB | 4.7 |
| 4 | Monarch Money | 4.4 |
10 more rowsFeb 23, 2024
The concept is simple: Take a few envelopes, write a specific expense category on each one — like groceries, rent or student loans — and then put the money you plan to spend on those things into the envelopes. Traditionally, people have used the envelope system on a monthly basis, using actual cash and envelopes.
What is the best budgeting tool? ›
Best Budgeting Apps Of May 2024
- YNAB (You Need A Budget): Best for Setting Goals.
- Empower Personal Dashboard™: Best for Tracking Net Worth.
- Goodbudget: Best for Envelope Budgeting.
- Oportun (formerly Digit): Best for Passive Saving.
- PocketGuard: Best for Tracking Spending.
- Stash: Best for Automated Investing.
YNAB excels in promoting zero-based budgeting and offers real-time tracking, while EveryDollar simplifies budgeting with a structured approach based on Dave Ramsey's principles and provides a free budgeting option.
Is envelope budgeting good? ›
Pros: It forces you into a disciplined budgeting system. It requires pre-planning before shopping excursions, instead of going to a store blindly and falling victim to impulse purchases. When you're out of cash in the envelope, that's it. You can't overspend.
Is Mint being discontinued? ›
Mint will go offline March 23, 2024.
The Mint budgeting app officially shut down on March 23, 2024, and users can no longer access their data on the app. Intuit®, which owns Mint and other personal finance platforms like QuickBooks® and TurboTax®, suggested users migrate to Credit Karma, which it also owns.
What is the best free app for budgeting? ›
The best budget apps
- YNAB, for hands-on zero-based budgeting.
- Goodbudget, for hands-on envelope budgeting.
- EveryDollar, for simple zero-based budgeting.
- Empower Personal Wealth, for tracking wealth and spending.
- PocketGuard, for a simplified budgeting snapshot.
- Honeydue, for budgeting with a partner.
EveryDollar is FREE to sign up for! EveryDollar Premium is an upgraded experience that includes all the features of the free version, plus: Bank Connect.
The three envelope system is an effective means for tracking which unit owners voted without revealing who they voted for. This protects the identities of the unit owners and maintains the integrity of the election.
What is the 100 envelope challenge? ›
It works like this: Gather 100 envelopes and number them from 1 to 100. Each day, fill up one envelope with the amount of cash corresponding to the number on the envelope. You can fill up the envelopes in order or pick them at random. After you've filled up all the envelopes, you'll have a total savings of $5,050.
What is a simple envelope budget? ›
In this technique, the idea is to break down your monthly living expenses, savings, and debt repayments into categories and set aside the appropriate amount for each bucket — one envelope for the rent, another for the car payment, one for each credit card payment, one for savings goals, etc.
Why did Mint shut down? ›
According to its parent company, Intuit, Mint wasn't making enough money, so Intuit began the app's closure in January. On March 23, Mint users will no longer be able to access their account data, which could include over a decade of their spending and financial history.
What is the easiest budget method? ›
1. The zero-based budget. The concept of a zero-based budgeting method is simple: Income minus expenses equals zero. This budgeting method is best for people who have a set income each month or can reasonably estimate their monthly income.
Is Rocket money legit? ›
Is Rocket Money legit? Yes, Rocket Money is a legitimate budgeting app that can help you track your spending habits, identify ways to save money and get a better handle on your personal finances. It has a 4.5-star (out of 5) rating on Trustpilot and is accredited by the Better Business Bureau.
What is envelope app? ›
Money can be moved to envelopes on your schedule, leaving you your available-to-spend amount which we call “Available“. Simply tap it to reveal your total balance and more.
What is one potential downside of using a cash envelope budget? ›
You may also feel unsafe carrying cash, as it's harder to track it when it's lost or stolen. It can be cumbersome to get started: Getting all the envelopes ready and allocating money into categories can take some time to set it all up, especially if you haven't created a budget before.
What replaced mvelopes? ›
PocketSmith is the best alternative to Mvelopes for Windows and Mac. Much like the Mvelopes budgeting app, our iOS and Android budgeting app is designed to provide you with the key elements of PocketSmith right there in your pocket.
