How to use the cash envelope budget planner
- Enter the pay you want to divide.
- List the envelopes, one per line, with an amount, a percent or the word rest.
- Enter the bills and coins you have, separated by spaces.
- Read the amount for each envelope and the bills and coins to put in it.
Formula
Fixed amount: as entered. Percent: pay x percent / 100, rounded to the cent
Rest: pay - all the other envelopes
Bills and coins: from the largest value down, take as many as fit and move on
Greedy filling gives the fewest pieces for standard sets such as US bills and coins.
A $1,000 pay split four ways
Rent $400, food $200, gas $100 and the rest for fun gives $300 for fun. With bills of $100 and below, the envelopes hold 4, 2, 1 and 3 hundred dollar bills. With only $20, $10, $5 and $1 bills available, rent would hold twenty $20 bills.
A biweekly pay of $1,185.50 with rent $520, food $250.75 and gas $90 leaves $324.75 for the rest. Food then needs two $100 bills, a $50 bill and three quarters. If you list no coins, the tool shows how many cents it cannot make.
How the envelope method helps
Cash envelopes work because spending stops when the envelope is empty. Dividing each pay date at the start removes the temptation to decide later, and the physical bills make the limit easy to feel. They suit categories that tend to run over, such as food, fun and gas, while rent and bills are often paid from the bank.
The bills and coins list lets you plan for what you can actually get from the bank. If you can only get large notes, the tool shows what cannot be filled exactly, so you can change the amounts or ask for smaller notes.
Planning the whole budget
The tool divides money you enter, so the total must not be above your pay. Anything left over is shown as not assigned. For the wider plan see the Budget Planner, split a paycheck by rule with the Paycheck Split Calculator, and give every dollar a job with the Zero-Based Budget Calculator. If your pay changes, the Irregular Income Budget Planner can help.
Assumptions and limits
- The pay is one amount, divided once.
- Percents are worked out on the whole pay.
- The figures shown are examples. Use your own pay and categories.
- Bills and coins are unlimited in number, so the counts show what you need to collect.
Frequently asked questions
What does the word rest do?
The envelope marked rest gets whatever is left after the fixed amounts and percents. Only one envelope can be the rest.
What happens if the envelopes add up to more than my pay?
The tool refuses the plan and tells you the total is more than the pay, so nothing is divided wrongly.
Why does an envelope say it is short?
The bills and coins you listed cannot make that amount exactly. The cents or dollars that cannot be made are shown.
Can I use other currencies?
Yes, if you list the values of your notes and coins in the same unit as the pay. Labels in the table use dollar signs for convenience.