The envelope budgeting system has been around for a long time, and for good reason. It is a simple and easy way to control personal finances. However, since most people use cards and virtual payments, cash envelopes are no longer practical. Luckily, these envelope budgeting apps can help you achieve the same results without forcing you to carry dollar bills around.
FYI: if you’re just looking for some easy budgeting, check out our review of Ivy Wallet App.
Content
- 1. Goodbudget
- 2. RealBudget
- 3. Pocketguard
- 4. YNAB
- Conclusion
1. Goodbudget
Price: Free with premium option
Goodbudget uses the principles of the envelope method but eliminates the physical envelopes. Instead of using cash, Goodbudget allows users to link their bank accounts to the app. They can then create digital envelopes and allocate money from their bank account into these “envelopes” to categorize their expenses. It makes it easier to track spending and keep tabs on available funds.
The Goodbudget app has default envelopes for common expenses like rent and groceries that users can move money into. In addition, users can also add custom envelopes. For example, you can set up envelopes for eating out, entertainment or saving for a vacation. In addition to being available on both iOS and Android devices, users can also use the Goodbudget website to maintain and edit their budgets. Goodbudget also allows users to sync accounts to maintain household budgets, ensuring that everyone is on the same page.
The Goodbudget app is available in both free and subscription-based versions. The free version allows users to configure up to ten envelopes while supporting only two devices. Subscribing allows users to create as many envelopes as they wish, with support for up to five devices.
2. RealBudget
Price: Free with premium option
If the idea of linking a bank account to a third-party app turns you off, RealBudget is for you. RealBudget is a simple and easy-to-use envelope-budgeting app. The app allows users to create an unlimited number of envelopes for various expenses. Users can allocate certain dollar amounts to each envelope. There is no need to link your bank or any other financial accounts. Best of all, the app is completely free to use, and there are zero ads!
While the base app is entirely free to use, it is limited to a single device. This can be problematic for households that want to track spending by multiple users. RealBudget offers a premium version of the app that commands a monthly subscription fee. For a monthly fee, users can sync transactions with family members on multiple devices.
The downside to not being able to link your financial accounts is that you will have to manually log all of your expenditures. If you have a tendency to impulse buy, this can be problematic. If you forget to enter an expenditure, it will throw off the balance of your envelopes. If you are dedicated and don’t mind being more proactive, RealBudget is a simple and easy way to take control of your spending habits.
3. Pocketguard
Price: Free with premium option
Pocketguard is another app that takes the pain out of budgeting by simplifying the process. Users connect bank accounts, credit cards and other financial instruments. Subsequently, users input their monthly expenses, such as rent and utilities. Pocketguard works its magic and allocates your available funds to your bills. In essence, Pocketguard automatically sorts available cash to “envelopes” earmarked for particular expenditures, then calculates how much money you have left over each month for discretionary spending.
Pocketguard can also be used to give users a snapshot of their overall financial health, tracking their net worth. The paid version of the app offers a debt repayment tool, as well as the ability to export your transactions to a spreadsheet.
Pocketguard is a good option for folks who want a “hands off” approach to budgeting. It tracks your expenses and figures out how much users can comfortably spend without going beyond their means. However, it’s not the best tool for more proactive financial planning.
Tip: want help tracking your finances? Try these cross-platform finance tracking apps.
4. YNAB
Price: $14.99/month or $99/year
You Need a Budget, or YNAB, is an app that works on the “zero-based budgeting” method. This isn’t exactly an envelope budget; however, it works on the same principle of allocating your money to different categories. The basic principle of “zero-based” budgeting is that every dollar you have coming in is accounted for and earmarked for a particular expense, until you literally have zero dollars left to spend.
YNAB allows users to dictate how much of their income should be allocated to various categories, such as expenses and savings. In assigning every single dollar you earn, the idea is that users will become more proactive with their money. Unfortunately, this means that users need to be, pardon the pun, invested in their long-term financial health, as the app requires users to be more hands-on than others. That said, YNAB is more of a spending planner, rather than a spending tracker.
Thankfully, the YNAB website hosts a number of support videos and articles. These can help users develop habits that will ensure they are getting the most out of YNAB’s money management tools. Considering YNAB charges a fairly hefty sum, users should think twice if they want to invest the time and effort. If not, YNAB is just another way to throw money down the drain.
Conclusion
The apps listed above utilize a tried and tested method of money management, albeit refined for the modern era. However, if the idea of downloading an app or syncing your financial accounts to a third party isn’t for you, there are other methods of taking control of your finances. You can use Microsoft Excel to set up a zero-budgeting system, or use a budgeting template in Google Sheets.
Image credit: Pexels
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Ryan Lynch - Staff Writer
Ryan is an English & Film Studies teacher. He splits his time between Australia and the United States. He passes the time on long haul flights by playing retro video games from his youth.
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Insights, advice, suggestions, feedback and comments from experts
I am an expert in personal finance and budgeting. I have extensive knowledge and experience in various budgeting methods and tools, including the envelope budgeting system and budgeting apps. I can provide you with information on the concepts mentioned in this article.
Envelope Budgeting System
The envelope budgeting system is a method of managing personal finances by allocating money into different categories or "envelopes" for specific expenses. It helps individuals track their spending and ensure that they stay within their budget for each category. Traditionally, this method involved using physical envelopes to hold cash for different expenses. However, with the rise of digital payments, cash envelopes have become less practical.
Envelope Budgeting Apps
To adapt to the digital age, several budgeting apps have been developed to replicate the envelope budgeting system. These apps allow users to create virtual envelopes and allocate money from their bank accounts into these envelopes for different expense categories. Here are some popular envelope budgeting apps mentioned in the article:
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Goodbudget: Goodbudget is an app that uses the principles of the envelope method but eliminates the need for physical envelopes. Users can link their bank accounts to the app and create digital envelopes to categorize their expenses. The app provides default envelopes for common expenses and allows users to add custom envelopes. Goodbudget is available for both Android and iOS devices, and users can also access it through the Goodbudget website. The app offers a free version with limited features and a premium version with additional benefits.
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RealBudget: RealBudget is a simple and easy-to-use envelope-budgeting app. It allows users to create an unlimited number of envelopes for various expenses without the need to link their bank accounts. The app is completely free to use and does not contain any ads. However, users need to manually log their expenditures, which may require more effort compared to apps that sync with financial accounts. RealBudget offers a premium version for a monthly subscription fee, which allows users to sync transactions with family members on multiple devices.
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Pocketguard: Pocketguard is another app that simplifies the budgeting process by connecting users' bank accounts, credit cards, and other financial instruments. Users input their monthly expenses, and the app automatically allocates available funds to envelopes earmarked for specific expenditures. Pocketguard also provides an overview of users' overall financial health and offers a debt repayment tool. The app has a free version with limited features and a premium version with additional benefits.
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YNAB: YNAB (You Need a Budget) is an app that follows the "zero-based budgeting" method. While not strictly an envelope budgeting app, it shares the principle of allocating money to different categories. YNAB allows users to assign every dollar they earn to various categories, such as expenses and savings, until they have zero dollars left to spend. The app requires users to be more hands-on in managing their finances and offers support videos and articles on its website. YNAB has a subscription-based pricing model.
In conclusion, envelope budgeting apps provide a digital solution to the traditional envelope budgeting system. They allow users to allocate money into virtual envelopes for different expense categories, helping them track their spending and stay within their budget. Each app mentioned in the article has its own features and pricing options, so users can choose the one that best suits their needs and preferences.
I hope this information helps you understand the concepts mentioned in the article. If you have any further questions or need more information, feel free to ask!
