Our latest success story comes from Andrea, who lives with her husband and three beautiful children (and two dogs) in Beaumont, California. Andrea and I had a wonderful conversation about life, family, the economic struggles occurring throughout the country—among other things—and she shared some amazing insight that I am confident will inspire and help other Mvelopes members. Andrea answered the following questions:
Q: How long have you been using Mvelopes?
A: Over a year. I’m not sure exactly how long we’ve used Mvelopes, but I know it’s been at least a year because we’ve been able to print a yearly report that contained all of our information for 2008.
Q: How has Mvelopes assisted you in living within your income?
A: Well, if there’s no money in the envelope, there’s no money to spend. It’s straightforward. At times, there are exceptions and I’ll have to move money from one envelope to another, but those times are rare. Also, some of our habits and family traditions have changed. My husband and I were both so surprised to see how much money we were spending eating out with the family, buying lunches, and taking daily trips to Starbucks. My husband now takes his lunch to work. As a family, we had a weekly tradition of going out for breakfast. We’d have breakfast burritos and donuts every Saturday morning. Now we eat breakfast at home and enjoy spending time together. My 9-year-old son makes his “famous egg sandwiches,” and we make donuts, too. Using Mvelopes helped to put a spotlight on the things that we think are important, and where our money is actually being spent. My kids are my priority and eating out isn’t. It’s definitely better for us to sit down as a family and enjoy meals at home.
Q: How much consumer debt have you been able to eliminate during that time?
A: We still have some credit card debt. However, I always pay more than the minimum payment and we will be paying off the cards in the future. (Incidentally, we have great credit now, because of using Mvelopes.) We were really surprised, however, when we discovered that we’d paid over $37,000 to credit cards over a period of time. It shocked us that we could pay $37,000 and still have credit card debt. Please understand, we didn’t carry a $37,000 balance (we’ve never had a balance anywhere near that large), but we’d charge something, pay it off, then charge again, and pay off again. Mvelopes helped us see just how much we were spending doing that. We were able to see the patterns and behaviors—it’s right there in front of us and it’s hard to ignore!
Q: How much have you been able to save while using Mvelopes?
A: We haven’t set aside much in savings yet, because we’re diligently working to pay off debt. However, we took an amazing two-and-a-half week vacation last summer—without incurring any additional debt (the trip is completely paid for). In addition, my husband and I have booked a cruise to celebrate our 15th wedding anniversary–and the cruise is completely paid for, too.
Q: How much has your average checking account balance increased while using Mvelopes?
A: I don’t monitor the account that way. There’s enough money to pay the bills. I’m not in the negative.
Q: What financial goals have you achieved while using Mvelopes?
A: Well, as I mentioned, we paid off a huge vacation, we’re taking a cruise, and we have completely stopped using credit cards. In addition, I have paid off three credit cards. My children are very involved in social activities and I’m pleased that we’re able to continue those programs. We will be able to pay off our car early. When we make large purchases, we now pay cash for them. I plan ahead for our BIG birthday celebrations and Christmas and pay cash for these events, too. Our family is definitely learning the importance of budgeting. We have a new slogan at our house–“Nothing new, make do.” My 4-year-old has learned the slogan and repeats it all the time.
Q: What are your next financial goals?
A: To eliminate all credit card debt and to put a significant amount of savings into an emergency fund.
Q: How many envelopes have you created?
A: We currently have 80 envelopes. Each member of our family has at least 4-5 envelopes. I have clothing, haircut, and personal spending. These things are priorities to me. We have multiple envelopes for each of our cars, and our trailer (maintenance, insurance, plus registration). My daughters have envelopes for Girl Scouts and gymnastics. My son has baseball, basketball, clothing, and haircuts. My husband has an envelope for work supplies, sporting equipment, eating out, dry cleaning, etc. We have two dogs and they have envelopes for the veterinarian, boarding, etc. We have an envelope for school (for lunches, books, PTA), utilities, medical expenses (co-payment, prescriptions, office visits). Speaking of medical expenses, as part of our medical plan, we have an option for a tax-free account that can be used for certain items. We weren’t taking advantage of that benefit prior to using Mvelopes. However, I generated a report of last year’s medical expenses and, based on the information in that report, my husband and I were able to see the advantages in making changes to our health benefits plan.
Q: How has Mvelopes helped to reduce financial stress?
A: As a stay-at-home mom, all of the bills are my responsibility. It’s always been hard for me to find time to get to this task and, in the past, I’ve tried to enter information into other banking programs, without success. My husband wasn’t good about getting me his receipts and the whole process was daunting. Before finding the Mvelopes budgeting system, I wasn’t keeping up on the bills. Working on the bills would often take me weeks. I desperately needed this tool to help me get a handle on our finances. When I told my husband about Mvelopes, he was hesitant at first. But when it came down to me using this tool, or him taking over the bills, it was an easy decision! The level of automation is very helpful. I can manage all the bills and all the banking in a very short time. Now my husband praises and promotes it.
Q: If married, how has Mvelopes helped you better collaborate with your spouse?
A: Well, let me say this–we’re still married. And we’re proud of the fact that we’ll soon be celebrating our 15th anniversary. My husband trusts me and he knows that I now have a handle on the money situation. It saves our marriage—we don’t fight about money. One of the number one reasons for stress in marriage is poor money management, and we don’t have that in our marriage. Sure, I’m human and I make mistakes, but my husband is tolerant and I have his complete support.
Q: What advice would you give to new Mvelopes users?
A: Be patient. Initially, it took awhile to set up my envelopes and my funding plan. I am very detailed and I have a lot of envelopes. The customer support staff was very helpful. At first, I felt stupid asking questions—I’m not a computer person—but they were so kind. I don’t require much help anymore.
I have one final comment. I’m always looking for ways to save money. For example, our medical insurance is with Blue Shield. They have a “Healthy Lifestyle Rewards.” If you do certain things (fill out an assessment, track your weight, etc.), you are rewarded and can earn up to $200 per person. My husband and I are taking advantage of this benefit and we’re already planning how we’ll spend that extra money. Perhaps your insurance company has a similar program. It’s worth checking out.
Andrea, it was a pleasure speaking with you. Thank you for your comments and for sharing with us your Mvelopes experience. Best of luck with paying off the rest of your credit cards, and have a wonderful 15th Anniversary celebration on that cruise!