Guest post from Kaylee of Couponing & Cooking
Ten months ago I started couponing. Over the last year, I have certainly had to tweak my couponing ways and find out what works for us, how much we realistically need of each item, and how sale cycles work in my area. However, one of the biggest and most effective changes I have made is couponing using cash.
Although we were seeing a significant impact on our monthly spending by couponing, I still felt like there had to be a better way to make those savings work for us and have a greater impact on our weekly and monthly saving goals.
I have always been a debit card kind of girl. My husband and I have a budget and a savings plan but we just never made that leap to a cash envelope system. After reading MoneySavingMom.com for a few months, I started to think long and hard about the benefits of using cash.
My husband and I discussed it and decided to try using cash for our weekly grocery, toiletries and household shopping. We decided to try it for the month of January and we love it so much it is now a permanent part of our lives.
Here are just four of the ways switching to cash has made me a more effective couponer:
1. It forces me to stick to our budget.
Let’s face it, as someone who coupons, it can be so tempting to spend a little more because you are getting a great deal. I try to be as practical as I can in my couponing but I still struggle with this every once and awhile.
We have set a budget of $80 a week for all household shopping. This includes groceries, toiletries, and all household items. This allows me to buy what we need and add to my stockpile, pantry and freezer without blowing our weekly budget. If there is a great deal that I want to stock up on, I have to take into account what else we need that week before I take advantage of the deal.
2. It forces me to plan my shopping trips.
I have always tried to make a list before I go shopping and stick to it. Before I started paying in cash, I could be more flexible with my list and what I chose to buy.
Now that I only have a set amount of cash to spend, I carry a calculator with me and as I go through my list I add up my total spending to make sure I am staying on target. This forces me to avoid impulse buys and really ask myself if we truly need something or if I am just buying it because it’s a good deal.
3. It keeps our stockpile under control.
One of the benefits of couponing is having a stockpile or a supply of grocery and household items on hand so you don’t have to make an extra trip and pay full price for something when you run out. It has allowed us plan our meals better, entertain friends on a budget, and give more to homeless shelters and food banks.
Having a set weekly spending budget helps keep our stockpile at a reasonable size. I can’t buy unlimited amounts of things even if it is a great deal. This has forced us to be more practical about couponing and kept us from failing into the trap of having excessive amounts of things or buying what we can’t use in a timely manner.
4. It helps us save more and balance our budget.
As I said earlier, couponing significantly lowered our weekly and monthly spending. I was able to start budgeting less for groceries and household items but the number still changed from week to week.
We now pull out two week’s worth of spending cash each pay day. This allows me to know exactly what is going to be coming out and budget the rest of our pay checks accordingly.
If we have extra money left in the envelope at the end of the two weeks, we split it between our long term and short term savings accounts. This allows us to save more on top of what we already budget for savings; and by also putting some of it in a “short term” savings account, we can spent that money on house projects or a fun weekend trip.
If you are reading this and thinking that using cash is a hassle, just know that I was you six months ago! I could never have imagined how something as easy and simple as using cash would make me a more efficient shopper, couponer and budgeter — but I am now converted to the cash envelope system and I’m not looking back!
Kaylee is a full time Catholic high school teacher and novice blogger from South Florida who loves cooking, couponing, and bargain hunting. She’s married to Justin, a firefighter-paramedic who although skeptical at first is totally supportive of her couponing and other money saving endeavors. They are currently enjoying the process of renovating and decorating our first home as time and budget allows. Kaylee blogs about her successes and failures both in the kitchen and at the store at Couponing & Cooking.
I couldn’t agree more. My husband and I have had to take cash out each week for our budget. It is the ONLY way we can manage to stay in budget. It is too easy to forget about the small 5 dollars here, 15 dollars there. The next thing we know we are a hundred dollars over budget.
when I know I only have so much cash on me. I am so much more careful about what I choose at the grocery store too.
Thanks for this post! I love it that you have a realistic grocery budget of $80/week. I know I could never get our groceries for $25-$30/week like I see on some blogs! With the way prices have gone up, I think $80/week is really good!
Thanks Katie!
I often spend less than $80 but by having that number I allow myself to save some of it. It also lets me go to the farmers market and get fresh veggies and other things we like to eat.
A CSA box is from a local farmer full of veggies (sometimes fruit and eggs are included – depends on what farm you get yours from). You pay a certain amount for the season – you can get half a share (small box) or a full share (lg box). If you look at my blog you can read about what came in ours. We split the cost with another family. We get a box of fresh, local grown veggies each week. Hth
What is a CSA box?
Community-Supported Agriculture. 🙂
You essentially pay a weekly (or maybe monthly…depending on how often you get a box) fee and then pick up your box of fruits and veggies. Usually local farms/orchards offer CSA programs during growing season.
We have been using the cash envelope system for over a year. I really like it. I have my envelopes we fund once a month and then I just take out what I need for each trip and return what is left after my purchase. I even got my parents to start budgeting this way too. It is a great way to stay on budget.
I have a fabric coupon organizer that I keep my cash in. It says Pampered Chef on it (maybe a hsotess special thing). I have grocery money, household money, a spot for current coupons that I need at the store, a spot for receipts and a spot for my bank where I put deposits and receipts from the bank. I empty it out every two weeks on pay day. I take out two weeks worth of money in cash on payday, but only carry one week at a time with me. I keep the second weeks in a fire box at home. Each Friday I pay myself for gorceries and household goods.
Once the money is gone,you can not buy anything else and to physcailly show my children that the spot is empty teaches them about budgeting and spending.
The rest of my money ( for eating out, vehicles, my children, holidays, clothing, gifts, vacation, home improvement, etc: set amout each opayday) is in savings accounts at my credit union. Money for set monthly bills in a checking account (half of the amt each pay day). We also have a savings account for automatic payments like our mortage and insurances. And another account is strictly long term savings.
(I tired paper envelopes and they ripped too often to be useful.)
Informative article. I’m a recent SAHM with two kids and have started doing couponing. I really need help/ advice as to coupon organisation because I end up throwing most of them cause they expired! it’s frustrating to clip coupons and they end up being not used properly. What works for you? I’m open to all suggestions.
You might consider using the “whole insert method.” Basically, that means you just file the insert away. Then if you need a coupon, you can pull out the correct insert and clip the coupon before shopping.
Of course, this doesn’t work if you like to have all of your coupons with you in stores in case you find a deal.
But it works for me, especially where we live (in a very rural area). I honestly almost never buy a paper anymore and rely mostly on Internet printables! For those, I have a small accordion folder (that I got for $1 at Target a long time ago) that I keep the printables in. I do keep that in my purse all the time. The stores I shop at never have amazing clearance deals, so I have found that I personally don’t miss anything by not having hundreds of coupons with me.
Hope that helps! It is different for everyone, so I’d encourage you to try a few different methods. 🙂
I am going to try Mvelopes, since the DPL folks put together a free basic account (see here: http://www.as-for-my-house.com/2012/05/envelope-budgeting/) … My *hope* is that this will serve the purpose.
But I do wonder… Because the fact is that I CAN then still spend that extra $1 here and there, then figure out what to do about it after the fact. Cash envelopes really do have a lot of advantages, especially in the early stages of trying to learn new habits!
I need to start to use the cash envelope system. Especially, since I am trying to keep our budget around $180 per month – this includes our $33 per month expense for our CSA box. So technically, we have $147 per month to spend. We have 2 adults, 1 – 2 yr old and a baby due in the next couple weeks. Very feasible.
This coming Friday, I will take out the rest of the month’s grocery budget money and see how I do. Thanks for the encouragement through your post!
Good luck, Carlye! I hope the envelope system works beautifully for you. Most of all, I really wanted to say how much I appreciate your wonderful attitude shining through in your comment. There are so very many who would fuss and moan about having a budget under $150 (after the CSA, of course) to spend, but your determination and positive attitude will get you so much farther than complaining ever would. 🙂 Good for you and thanks for being a great example!
Thank you so much! I have to work pretty hard to keep our budget low but it is fun. I shop at Aldi for the majority of our food and then coupon at Publix, CVS, WAlmart, Bi-lo and our health food stores. I have a garden to fill on gaps of the CSA box and we go to the local farmer’s market. my new favorite resource for organic food is Vitacost – I have been able to get lots of great deals with their referral program. Also swag bucks.com – love the free amazing gift cards for coffee!
I have found we can eat very healthy and still keep our small budget. I am learning to be creative with what the Lord has blessed us with.
I don’t use the envelope method, but I track my spendings on a excel spreadsheet. It’s works just like the envelope method and I still get to use my credit cards to earn points/rewards.
Stacy,
I was using my credit card to get the rewards too. I was keeping my spending pretty low…..but when you use that card it is easy to spend an extra $1 or $5 or more every time you shop. My credit card recently had fraud on it and my bank shut it down and sent me a new one (they dropped the fraud charges…no biggie). In the week I did not have the credit card to use I realized how much less I spend with cash only! Before I would use cash most of the time but that occasional credit charge can add up, even if you are diligently tracking it! (Often I would charge something on the card then pay the card at the bank the next day with cash) Everyone has something that works best for them, but I just wanted to let you know my experience because just a month ago I had a similar strategy as you.
Hi Jessica,
I’m not trying to argue with you, but…you shouldn’t be spending the extra $1 or $5 if you stick to your grocery list! That’s why you make a list before going to the grocery store. I KNOW it’s easy to say than done and I see your point of view too. Have a great week 🙂
These are great tips. In fact, I think I’ll forward this article to my dad, because this is something we could use, too. What kind of categories to you have in your cash envelope system? I’d like to purchase a cash envelope system. However, budget being what it is, I’ll probably end up making my own instead 😉 🙂 What do you suggest?
Love and hugs from the ocean shores of California, Heather 🙂 🙂 🙂
Hi Heather,
I haven’t made these yet, but quite a while back I bookmarked a pattern for making envelopes that Crystal feature in a post here (https://moneysavingmom.com/2010/01/the-envelope-system-prettified.html) – hopefully the link will come through. I thought this looked like it wouldn’t be too expensive or difficult… one of these days I might actually get around to trying it!
If you have a debit/ATM card, see if your card can be used in any network ATMs. Our debit cards work, fee-free, at the ATMs at our favorite grocery store chain.
I am still trying to figure out how to go to cash only. We bank out of state with no affiliated banks where we live (we have free checking, and no monthly charges and cannot match the deal here). Once I can figure out how to do it I will give it a try.
Buy a pack of gum at WalMart and get cash back!
check in your area for no fee atm. In my market in Richmond VA area.
A local gas station (WAWA) has no fee atm. We have USAA and they must have agreement with various banks and some credit union and even Target atm’s do not charge for with drawls. Check with your out of state bank and see if they have any agreements with atm providers.
Why are you sticking with that bank? That does not sound convenient. Get another bank/credit union that is in your area. You don’t need to close the account of your main bank if you love it. You could just set up your banks to transfer money between each other. I have two banks myself. I use them to help me save money as my emergency fund is at one bank and my main spending account is at another.
I have been hanging on to that same reason for a while, but I have recently decided that I need to make the change. I’ve come up with a couple of possiblities:
1. My out-of-state / online bank offers ATM fee rebates, so I actually can go get the money out at the local ATM and get the fees refunded. (Because the problem with the “pack of gum and cash back” method is the low limit on the amount of cash back they will give).
2. I did manage to find a local credit union where I can have totally free accounts (especially with Direct Deposit). They do not match all the OTHER features, and I will continue to bank at my out-of-state bank for most things — but I can online transfer back and forth to/from the local account, and use them for things like getting out cash…
Thanks for the encouragement Kaylee! After months of procrastinating, I took out the cash to cover my monthly grocery budget for the first time TODAY. We’ll see how this month goes. I’m really curious to try it after reading so many reader testimonials on switching to cash. 🙂
Thanks so much for featuring my guest post Crystal! It’s an honor to be on Money Saving Mom!
I agree with your points 150%! In fact, if I were to suggest 1 method to someone new to grocery cost control, it would be “switch to cash.” There’s nothing quite like watching your monthly grocery cash stash dwindle as month-end approaches. It really clarifies those “do I really need X, Y, or Z” moments.
Awesome article! I always was hesitant to use cash because 1.) I didn’t want to lose it and 2.) I like my credit card rewards (yes, I carry a $0.00 balance :D). Anyway, what I do is each month, I buy myself a $120 Kroger gift card. That is my monthly budget for household items. That way, I still get my credit card points, and I can’t go over budget. Only drawback, though, is I am committing my money to the gift card, but if I spend less one month, I take the extra cash and put it in savings.