The Mvelopes inbox helps keep you on top of your transactions and using it for five minutes everyday makes a big difference in how successful you are in keeping to your budget.
The inbox in Mvelopes is where transactions appear after they have cleared your bank or other financial institution. Purchases and deposits wait to be categorized in your different envelopes.
Knowing where every one of your dollars is spent is important for you and your financial goals and here’s why.
Keeps You Up-to-Date
When your Mvelopes inbox is empty it means three things:
- You have placed every transaction in its appropriate envelope.
- You’re up-to-date on all your transactions, so you also know the correct balance in each of those envelopes.
- You are able to make informed decisions about what you’re spending in the moment because you know how much is left in that envelope and whether you have the money for the purchase or should make other plans.
Just having that information at your fingertips in the Mvelopes app on your phone, tablet or laptop is good enough to make a difference in how you manage your finances. But, tracking and assigning purchases both have other benefits as well.
A Budget Alone Isn’t Sufficient
A study in the Journal of Consumer Research1 found that simply having a budget didn’t help people stick to that budget. They needed two other things. First, was a goal and second, was to track their spending.
Your goal could be anything from budgeting so you can save for a vacation, to spending less money so you can pay off your house quicker. Your goal just needs to matter to you.
Tracking spending keeps your mind focused on your finances. When money gets involved in your daily life you know exactly where you stand and what your goals are. It makes your spending decisions that much easier.
Categorizing Your Purchases Reduces Spending
Another Journal of Consumer Research study2 found that categorizing your purchase led to reduced spending in the future in that category. For instance, if you spend $20 on a ticket to a local music festival and assign it to your entertainment envelope, you’ll likely spend $7.62 less from your entertainment envelope than someone who doesn’t track their purchase.
The process of categorizing your purchases helps to put limits in your mind in two ways.
1. You have already used part of your money which means you have made decisions that limit your future options. You no longer have all the possibilities of your plan at your fingertips and it helps to limit your perceived options and ways to spend money.
2. You have a limited amount of money left to spend. There’s only so much money left and you naturally second guess whether the next thing that comes up will be as important as the one following it.
If you’re able to limit your spending in this manner for each of Mvelopes’ eight Everyday envelope categories, that amounts to $60 saved every pay period.
Assign and Track
An important part of Mvelopes is assigning every dollar a purpose. That part is only important if you’re following what you’re planning to do. Tracking your purchases helps you to return and see how your plan turned out. Figuring out where your money goes helps plug any leaks or limit impulse purchases.
The Success Cycle has four parts:
Your Mvelopes inbox helps you track everything that is going on with your money. Even with a plan, you have to track your expenses, otherwise you won’t have anything to compare or the information needed to adjust your plan.
Reports that show what you planned to spend and what you spent or what you spent in certain categories will give you the information you need to compare and adjust your categories and behaviors. Mvelopes helps give you the information necessary to create a plan that saves you money, improves over time and accomplishes your financial goals.
Making time each day to clear out your Mvelopes inbox will keep you up-to-date and help you reach your financial goals. Mvelopes is an award-winning budget app that helps you set up a digital envelope budget so you can manage all your expenses, track your transactions and achieve your financial goals. Get started today with a free trial.