Envelope Budgeting – How to Get Started

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By Steven B. Smith
29 May 2005

Ways to Start Budgeting:

• Make a commitment, and truly have the desire to change and succeed.
• Take stock of where you stand right now.
• Spend less than you make.
• Follow the Success Cycle (Plan, Track, Compare, Adjust) every month.

Creative ways to Budget:

• Spending Management is a whole new way to look at the old concept of budgeting. A spending plan is proactive and puts you in control.
• Envelope Method of Budgeting
• Make it a game by seeing how much you can "sweep" at the end of the month from your monthly discretionary envelopes into savings, debt reduction, or a new car fund/vacation fund.
• Mvelopes Personal – all online, with access from anywhere, at anytime.
• Use the Debt Roll-Down principle to quickly eliminate debt.

Tips for Success:

• Don’t get discouraged! On average, people spend 10% more than they make. Don’t get discouraged if you do too. Stick with a spending plan and be committed to fixing the problem of overspending!
• Be consistent. Put together a plan, track your expenses, compare your results and make adjustments. Do this every month.
• Get everyone involved. At the beginning you may even want to have a weekly family meeting where everyone who spends money is together, reviewing the spending plan. Its critical for you and your spouse to work together but, why not start educating the kids about spending management too?
• Learn to Pay Cash. Don’t rely on credit. If you don’t have the funds in your envelope, don’t make the purchase.
• Avoid Department Store or other merchant credit accounts. People tend to spend more with these cards and they often have higher interest rates.

By Steven B. Smith, author of Money for Life — Budgeting Success and Financial Fitness in just 12 weeks (www.moneyforlifebook.com)

For a step-by-step process of how to make an effective spending plan, go to mvelopes.com for more information about Mvelopes® Personal. An online budgeting system, Mvelopes® Personal is quickly becoming one of the hottest budgeting Web applications on the market. In2M has successfully marketed this budgeting service in all 50 states and in seven countries worldwide. Thousands of users are praising its capabilities for helping them achieve financial freedom.

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