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Lots of tried-and-true budgeting hacks have been passed down over the years, and for good reason — they work. But some methods haven’t held up well over time.
In early 2021, insurance agent Nova Scialabba and his wife Bonnie, a stay-at-home mom of three, wanted to start saving more and were initially drawn to the classic cash envelope method. That’s when cash is stored in envelopes slated for budgeted spending, and the rest is saved.
But, the envelope method relies heavily on cash — and that’s become less practical with time for the family of five. With a national coin shortage, the pandemic discouraging cash transactions, and the rise of online banking and shopping, paying cash for every purchase has become more difficult.
The cash envelope method worked, but wasn’t always practical
Using the envelope method was effective for cutting their spending and saving more, but it didn’t always make sense.
“There were multiple times where we would forget and leave an envelope at the house, and then we’re sitting there at the grocery store with $200 worth of groceries rung up,” Scialabba, who lives in Las Vegas, told Insider. “It was just very inconvenient.”
The couple found Qube, an online bank and app that takes the envelope savings method online, and kept up with the envelope method digitally to increase their monthly savings.
A digital version of the envelope method helped them save thousands
Before they started using a strict method for managing money and budgeting, Scialabba said it was hard for them to actually build up their savings. But, seeing where their money went with the envelope system — both online and in cash — made it much simpler.
With the digital envelope method, they managed to save $4,000 in one month by curbing impulse purchases and cutting out extra expenses. Previously, they would have spent the money instead of saving it.
“With the recent changes of the pandemic came new and unhealthy habits,” Scialabba said. Their budgeting system helped them realize they were overspending on food delivery and dining for their family, and also that a big chunk of cash that could have been saved was being spent on online shopping.
The new system helped them curb that. “It forces you to really analyze what it is that you’re doing in that moment,” he said. “Usually that awareness comes later when the credit card bill comes, and at that point, it’s too late.”
Not only were they more mindful of their spending, but they also found that it made conversations about money easier as a couple. “It brings awareness to where your money is and where your money’s going,” he said.
Even though the envelope system in its traditional sense didn’t work, this new method proved to be an easy, updated way to get the same effective results.