Utilizing the cash envelope system provided the second greatest impact on our finances next to a positive mindset shift. Let me paint you a brief picture prior to this decision. The hubbs and I both carried our debit and credit cards to use for business lunches out, playdates + coffee, the random one off trip to the grocery store (for the umpteenth time that week), dropping by Nordstrom to pick up a few things, impulse purchases--you get the idea, thoughtless spending in the moment to reconcile on the budget later. I should preface we don't even live extravagantly, but regardless of how you currently live I can promise you will see a difference when you switch to cash. We are still fine tuning each category and shifting funds as we get familiarized with our needs/spending patterns, but what a night and day difference it makes when you can actualize your spend.
Here are just a few the benefits we've experienced that you can too:
1. Telling your money where to go (ie: in control of your finances) - When you take the time to budget for each category you gain insight to needs vs. wants, spending habits, and once the money is gone it's gone.
2. Delayed gratification - Ok you may think this should not be categorized as a benefit but hear me out. This is a learned habit. Now that the hubbs and I have outlined our short/mid/longterm goals, we have an end in mind. The goal is well worth delaying momentary gratification. We've become more intentional and ask ourselves questions before making purchases like, "Would I rather purchase coffee several times a week or end up with XXX amount at the end of the month to put towards savings?" or "Do I really need this hand soap/make up remover/can of beans/you name it when I may have one on hand?".
3. Creativity, resourcefulness + frugality - As fellow foodies, our family LOVES to eat out, try new restaurants, appreciate yummy cuisine. We have drastically cut down on this area of spending anywhere from 2-3x/week dining out to once every two weeks. When we choose to treat ourselves we get creative. Last week for instance we enjoyed MOD Pizza (split a double crust), 2 hot cocoas and drove around viewing Christmas lights all for a whopping total of $15 between the 3 of us. Is that even possible in Seattle you ask? Yes, yes it is #winning. I found myself savoring the experience more intently because it was the exception to our typical dining in routine.
4. Savings increase, debt decrease - When we stopped overspending by $1000 each month and put away the debit cards, our savings grew and debt began decreasing. Once you gain some momentum it's addicting and rewarding to reap the benefits. For instance, we had to purchase new tires recently (not a cheap feat especially on a 4Runner), but because we saved/planned several months prior we could pay in cash vs. credit card.
5. FREEDOM - Knowledge is power. I can't even believe I now get giddy over updating the budget, gathering receipts to breakdown our cash spending categories, challenge myself to no spend days, dwell on the possibilities of attaining our financial goals with each passing month. Experiencing this freedom outweighs ignorance and mindless spending.
This list isn't comprehensive. The positive benefits continue and will be unique to each individual. I hope this has provided even the smallest ounce of encouragement to inspire change. Friends...if this numbers challenged, ordinary, stay at home mama can change, you can too! I'm cheering you on in your journey to living life abundantly.