Yes, I know this picture isn’t of ducks, but I figure the swans are a good substitute!
For the last six weeks I’ve been working with my wonderful flatmate, helping her to learn a new thrifty cash system for spending. She was never an elaborate spender, but at the end of the month usually had less than £30 to distribute to her savings, she found this very difficult as it meant it was almost impossible to get ahead, to save for big expenses especially on 1 small income. So one evening she and I sat down and made a cash budget system.
We put together 10 jars and allocated a weekly amount into each. We decided each Monday she would make a cash withdrawal and submit the following into each jar
Food £20
Clothing £5.50
Petrol £8.00
Entertainment £8.00
Hospitality £5.00
Charity £25.00 (this includes her tithing)
Gifts (Birthday/Christmas) £5.00
Car and House Repairs £10
Savings £60
Holiday Account £10
As I said, her spending wasn’t in anyway outrageous before, but if she needed to buy 5 or 6 Birthday presents that month, she might have dipped into savings, if she needed more petrol money the same, now, with the jar system she can see what is in the budget and what isn’t. The petrol money has to last each week, as a result she can judge where she needs to make cutbacks, she can also let money build up in each jar and live well using this simple cash system.
In 2 months she has gone from saving £30 a month to a minimum of £250 a month. She has cut her weekly grocery spending from £30 to an average of £15, again giving her an additional £ each week she can allocate to her savings or build up for special purchases. My friend now knows she can save towards holidays, retirement, a house and car account and any possible needs that arise, just last week she was able to pay a plummer cash. Quite simply she has found freedom by using a thrifty cash based system.
My new post is up at the co-op, including one of my favourite frugal recipies!
Thank you for all the kind get well wishes, I’m finally getting better after a rough two weeks!
Glad to hear you’re on the mend!
I’ve been really resisting going to this sort of cash-based system, since it seems like such a hassle, but I’m tempted. I know I’m not saving the way I should be right now, and even though I use tracking software and know where the money is going, it’s not the same as seeing the actual physical dollars.
That being said, how do you account for things you can’t pay by cash in this system, like online purchases and stuff?
Grace, it is *really* worth the effort!
You can take the money from your jar to your bank to pay your credit card for online purchases!
Glad you are doing better, and well done to your room mate for her budget. (and of course you for helping her!)
Hopefully the swine is gone from you.
I hope you’ll be getting back to regular posting. I miss it! I always enjoy your financial tips. Email me sometime! 
I just changed my blog to the link I gave as my website. It’s free this way and I had someone who found me and well anyway I changed it so look me up.
oh FT, come and live with me! I just can’t seem to get my spending in order!
Ooh Sarah, I’m sorry. How can I help?
I don’t think you can but thanks for offering
I know all the ‘theory’ so to speak, just terrible at sticking to it!! Must try harder!!
20 pounds a week for shopping that’s pretty impressive, always thought the UK was an expensive place to shop,
I’ve taught her everything I know Rob. I usually shop for £15 a week. I think you’ve inspired a post!!
you are such a good neighbor to have. i have to agree with rob-20 pounds would be difficult (though not impossible, i admit) for shopping money. i am still really interested in a food-related post for the tribeca yummy mummy blog. your voice is strong, and from a food, perspective, now is the time to shop frugally here. would you be interested?
Absolutely. I’ve emailed you!
so glad to hear you are feeling better! keep up the vitamin c, and plenty of rest!
xx
and thanks for the insight into the money thing – i find it so helpful to see actual figures (especially in pounds and pence!) i am on a tightish budget (better now that i’m living with housemates and not on my own) so it’s always enlightening to see how everyone else divvies money up too…hrmm.
ps i like the swans too
As a farmer I find spending on £8 entertainment and £20 on food depressing. Surely food is worth more than amusements?
Also, if everyone only considers the most frugal of choices when buying food, soon we will left with only big box stores carrying industrial “food” from factories and low income countries. Is this really what we want?
EJ you might be surprised to know that I shop at local farmer’s markets for my fruits and veggies, so am certainly supporting farmers. I have friends who spend triple what I do and don’t shop local, so it isn’t necessarily about what you spend.
It is very easy to enjoy life on £8 a week entertainment!
You and Rob have inspired a post!
wow, incredible! thanks for sharing that inspiring story.
I’m glad your feeling better and I’m looking forward to your inspired how to do it post!
I love the jar idea.
This looks brilliant! Thanks, it is so encouraging!
Your “jar technique” seems like a good way to track spending… I should try it myself soon.
I must add that I’ll be living on my own soon & I like to think that £20 (or 20€ in my case) would be enough (to eat healthily) for 1 person each week!
I think spending using cash definitely helps to see what the cost of things are … I’ve just started doing this and really notice the cost of things that used to pass me by. For eg, I bought a magazine at Chapters (in Canada) yesterday and it cost me $9.03 CDN – I was quite shocked when I realised the price whereas normally I would just not notice that detail when I used my credit card. I’m now thinking of getting a subscription to it (it’s a buddhist magazine).
Meant to add there that a subscription would be much cheaper – averaging out around $5 a magazine!
Thank you for such a great post! I’ve heard the “envelope method” described many times across financial blogs but I never really “got it” until now. this makes perfect sense and I can really see the value in it. I’ve been on a cash based system for a long time to cut down on our weekly spending but it all goes into one big pool from which we spend everything. Which works great, until you spend it all, leaving little leftover to build on from week to week for each category. I’m going to have to sit down and figure out how much to budget for each and really give this a go. Thanks! =)