Question about Dave Ramsey's envelope system

[annettemarie]

We're just starting with the envelopes this week and I have a question. If I have $200 in my grocery envelope, why do I have to keep track of what I spend where? I mean, once the grocery money is gone, it's gone. I don't understand what knowing I spent $27.81 at Wegmans and $36.21 at the Surplus Outlet is going to show, so it just seems like an extraneous extra step.

Likewise, I don't see why I have to keep track of my "blow" money. If I want to spend $1 on a McDonald's sweet tea, why would I need to account for that? I thought the whole point of that money was that I could do what I want with it.

Um... in case you can't tell, I'm the free spirit and DH is the nerd.

[Tradd]

I never accounted for my blow money, unless I actually wanted to have some idea of how much money I spent on fast food.

As for keeping track of grocery money...well, might not be a bad idea, just in the beginning. Especially if you're unsure about your budget categories/how much to put in your envelopes, you could keep track for a while, to give you an idea of how much you really spend. Just put your receipts in the appropriate envelope. That's the easiest way to do it.

[annettemarie]

Originally Posted by Tradd

Just put your receipts in the appropriate envelope. That's the easiest way to do it.

I can do that. It just seems... I don't know, demeaning somehow to have to account for every cent I spend on groceries.

[Tradd]

Originally Posted by annettemarie

I can do that. It just seems... I don't know, demeaning somehow to have to account for every cent I spend on groceries.

You don't have to do it forever! Just try for one pay period, or however long you go before refilling the grocery envelope.

[excitedtobeamom]

I wouldn't worry about it for blow money but it may help for groceries. Honestly I don't always keep track of the groceries but I sometimes do. When the envelope is empty I don't shop anymore. I try to keep $20 at the end for fresh fruit/vegetables.

[Aufilia]

We've been doing cash envelopes since I got laid off, and at this point I don't really keep track of where I spend money -- just how much is in there. I do keep the receipts (at least until the end of the week) and also any relevant coupons.

[lalaland42]

Well I never kept track of grocery money personally but I hoard receipts so if I had a week where I wondered where the money went, I could dig through my purse until I found most of them. If you have a problem spending too much $$ on groceries, it is helpful to be able to look over a week's (or month's) purchases and realize that you blow too much on X and maybe you should cut down or modify your menu. At the same time, I hear you on keeping track of it. : Some people don't have a problem spending too much on groceries though. I think it is one of those "what works for you" type things.

I'm a geek AND a free spirit.

[annettemarie]

Originally Posted by lalaland42

I'm a geek AND a free spirit.

I'm a free spirit with OCD. I LOVE to keep track of things... when it's my idea. I think I'm driving our instructors a little crazy.

[lalaland42]

I think that is why the envelope system works for me. It is not strictly necessary to keep track of things unless I want to. Since all the allocated funds are already in the pretty box (envelope), you don't blow the budget by not keeping track.

[mnnice]

Originally Posted by lalaland42

I think that is why the envelope system works for me. It is not strictly necessary to keep track of things unless I want to. Since all the allocated funds are already in the pretty box (envelope), you don't blow the budget by not keeping track.

I totally agree.

I also see the point of either tracking everthing once in a while or tracking a category or two each month so you have a firm idea of what you spend. Our current envelope system is just a single envelope with all fuel, groceries, clothing, cleaning, household, and entertainment out of a single envelope.

[Delicateflower]

I hate the term 'blow money'. It sounds like money you earned practising the oldest profession.

As far as accounting for it, don't forget that Dave Ramsey is designed for people with chronic spending addictions, so they might need to do this to get themselves under control.

I have never tracked my play money, but sometimes you ahve weeks like this week when the lot was gone by day 2, thanks to Ace Hardware.

Originally Posted by Tradd

You don't have to do it forever! Just try for one pay period, or however long you go before refilling the grocery envelope.

I did this and it was enlightening. It helped me get a balance between the different parts of our grocery budget.

[annettemarie]

To me "blow money" sounds like we're snorting coke, LOL!

And I think it's awesome that your spend your play money at Ace Hardware. Mine gets sucked away at thrift stores. Which is actually part of the problem-- lots of things we didn't budget for and I would end up spending my birthday money or whatever on kids' clothes.

I'll get used to it eventually I guess. Right now I'm just sort of chafing at the restrictions.

[Denvergirlie]

Originally Posted by annettemarie

I'll get used to it eventually I guess. Right now I'm just sort of chafing at the restrictions.

Don't view it as a restriction... it's not really, you are just taking control.

You need to control the money that comes into your life. Money does not control you. You are telling it where to go and what job it's going to do. This is a positive step. Saving recipts right now, just helps you get a better picture of what you do spend your money on. Think of it as market research.

Being a self proclaimed "nerd", maybe you could take joy in running this like a business.... "Annettemarie, Inc."
Can you make it more fun for you that would engage the free spirt as well?

[Black Orchid]

Not doing Dave, but like his ideas... anyway, could you compromise by putting the reciepts into the envelope?

[Charmie981]

I can see how, for me, it would be beneficial. We have some stores around here that are really pricey, but convenient. So sometimes I stop in there and pick something up...I never actually SHOP there. If I get to the end of the month and half of my grocery money got spent there, I'm going to stop "stopping in" there to pick up an item or two, KWIM?

We're starting this in October. I'm a little nervous. We've been tracking expenses since the middle of August and know where the excess is spent and honestly, groceries is a category that is costing way too much (especially for a family who is ALSO eating out way too much!). I'm not sure how or where to cut the grocery budget, but it has to get cut, preferably by a couple hundred dollars, without reducing the quality of the food we eat .