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A Mom’s Approach to the Cash System

A Mom's Approach to the Cash System - Columbia SC Moms Blog

When out shopping and asked, “Debit or credit?,” we respond “cash.” When asked, “Would you like to open a store credit card?,” we respond “no thanks, we don’t use credit cards.”

Yes, we are a cash system family.

Over the past nine years, we have operated on a cash only system for our daily expenses. I always get a ton of questions, especially from moms, about how to implement this system with a family. So today, I’m going to share the system with you! We have tweaked this system several times based on family and economic changes, so you can customize the plan to fit the needs of your family as well.

How it works:

We have an envelope for each daily expense. Yes, literally an envelope. On the outside of each envelope we write the expense (i.e. groceries) and the dollar amount we put in that envelope each month.

A Mom's Approach to the Cash System - Columbia SC Moms Blog

Our Current Envelopes-they get pretty worn

Once a month, we withdraw money to fund all the envelopes. We used to do this twice a month, but find once a month works better for us. Regardless of how often you withdraw the money, make sure you get various bills from the bank. Do not come home with all $100 bills because you need to have smaller bills for several envelopes.

Once we implemented this system, I realized two things: A) I was the one using the system most of the time since I do the majority of the shopping. B) I struggled to make this system function daily with kids in tow. This system soon became my enemy and I was ready to go back to swiping that convenient card, until we started fine tuning it for our family.

Tips and tricks on making it work for your family:


This is the only area I don’t use cash for, simply because I’m not leaving my kids in the van to go inside to pay for gas. We have a gas envelope, but it is only for my husband’s car and we leave gas money for my car in the bank account.

Discount Stores

This has to be the number one question I get: How do I pay for items in one store that need to come out of several different envelopes?

So, you need diapers, dog food, rice, shampoo and a birthday gift. For our family, this would require four envelopes (baby, pet, grocery and gifts). So what do you do? Take ONE of those envelopes into the store so you are not fumbling with four different envelopes in the middle of Walmart with children running everywhere.

Once you get home, go through the receipt and pull money from each envelope you didn’t take to the store to replenish the envelope you used in the store.  This is where it is vital to have different bills in your envelopes because you’ll be swapping out money between envelopes.

Changing Envelopes

Envelopes come and go. Once a child in our home is potty trained and eating table food, the baby envelope disappears. When another child starts school, the school envelope gets funded more for things such as school fees, lunch money and school supplies.

Empty Envelopes

What happens if your envelope is empty before the end of the month? Well, you get creative! Maybe you don’t fix that recipe you were wanting or maybe you have to cook more often because the eating out fund was blown in the first week.

This is honestly where it gets real. This is where you find yourself in the midst of an internal temper tantrum because the system didn’t work the way you wanted. Hear me when I say, disciplining yourself and telling yourself no is never easy.

This is where a cash system, as “old school” as it may seem, is different than other systems. Other tracking systems can be useful resources, but a cash system is the only way to truly control your spending. While other systems categorize your spending for you, they don’t stop you from spending when you’ve gone over your budget. An empty envelope will.


Other than being debt free, teaching your kids to use this system is the best reward. They learn:

  • The value of money: They know that once the envelope is empty, it’s gone for the month.
  • Financial discipline through delayed gratification: If we can’t buy something now, maybe we can next month.
  • How to be resourceful with their money: They shop around for the best deal or buy used items.

The cash system has worked great for our family, but it took time to work through the functionality of it. Maybe you tried it once but gave up. Why not try to revisit the plan and give it a second chance? Maybe this post has sparked your interest and you want to give it a try. Or, maybe this confirmed that you’ll never be a cash system family.

Regardless of where you are, find a system that works for your family, be diligent in teaching your children financial responsibility, and aim for financial freedom because it is possible.

Do you use the cash system? If so, what are your tips and tricks?

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2 Responses to A Mom’s Approach to the Cash System

  1. Kimberly January 8, 2017 at 8:13 am #

    How do you make reservions for things like airline tickets and hotels? Buy Visa gift cards and use those?

    • Missey Calcutt January 8, 2017 at 10:18 pm #

      Hi Kimberly. So for reservations and anything online like shopping online or putting more money in the kid’s lunch account, I use our debit card. I make a note (usually on a post-it note stuck to the envelope) of the amount and withdraw less for that envelope for the next month. This should have been another tip! Thanks for asking.

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