What is the Envelope Method?

The envelope method is one of the simpler ways to manage a household budget. It was popular in times when cash was used on a daily basis - it was practiced by our grandparents' and parents' generation.

It involves dividing the money we have into envelopes with specific purposes, such as food, housing, children, health, entertainment, vacation, or savings. This creates a kind of plan that allows us to control what and how much we want to spend.

This method in its original form works very well when we operate with cash on a daily basis. However, nowadays cash is less important and we increasingly pay by transfer, payment card, or even with our phone.

So if we already pay for everything virtually, maybe we should also turn our envelopes into virtual ones? Indeed. And it works really great 😉