Envelope Budgeting disadvantages.

There are some disadvantages to envelope budgeting. I am a huge fan of envelope budgeting but, let’s be honest, there are disadvantages as not every system is perfect. 5 Steps to successful Envelope Budgeting Envelope Budgeting- money management for everyone

Here are the four biggest disadvantages which I have found

The Family:

It can be tough to get everyone on board, especially if they have their own credit cards. The excuses range from it being too dangerous to carry cash, to I need this now and didn’t have the money so I used my card.

This is a constant struggle in my house. My son (AJ) and two younger children are better with it than my husband and my oldest daughter. AJ is naturally good with money and thinks about the cost of almost everything. My younger girls don’t really deal with money a lot as they do get an allowance. My youngest does seem to have got her brother’s money savvy habits.

The Money

To get the money to stuff your envelopes, you will need to go to a cash point, whether it is the till point at the supermarket, the ATM or even the banks, and this makes people nervous. You now also have to get home without spending all the money burning a hole in your wallet!

The Complications

The process sounds simple enough, but what happens when you go to a hypermarket that stocks food, clothes and garden equipment and you buy from all 3 departments? This means that you will need to take money from different envelopes to cover the costs.

The Rewards

South African banking credit services are big on rewards on both your credit card and cheque card. When you use your bank cards to shop, you earn loyalty points but now are paying cash for everything.  You may feel like you are losing out.

As time goes by my family and I are getting used to using the envelopes and the disadvantages don’t seem so great.

Why not look into envelope budgeting? Do you use envelope budgeting?