Julianne (from Seattle, Washington) wrote to us over a year ago to tell us just how much she enjoys using Mvelopes. Julianne wrote:
My dad was self-employed and we tended to spend the money when we had it. Though I knew what I should do–set a budget and live by it–I often found myself just living really frugally until I needed something or saw a “great” sale. Looking back, I never knew whether I actually had the money to spend and, therefore, often felt guilty for buying myself a new sweater. Though I always paid my bills, I didn’t plan for big ones (taxes) and often had to draw on my savings to get me through some unexpected expenses.
Once I got married, my habits impacted more than myself and it became more complicated living with uncertainty. My husband and I both decided our single spending habits lacked vision. We decided to start spending money with the future in mind so that we could spend money without the guilt. I could not have gained the insight into our actual financial picture without Mvelopes. I have never felt freer to save or spend! With the purchase of a new house and a new baby, I needed to know exactly where every penny was going. Now with Mvelopes, we know exactly how much we have to spend on necessities (groceries, diapers, etc.) and even make room for a little fun. We splurged and went out to eat for our second anniversary knowing exactly how much we could spend without any guilt! I make it a game for myself to see how much I can have left in as many envelopes as I can so I can put the leftovers into savings. Since we started Mvelopes in January, I feel like we are off to a great start toward financial freedom for this year.
In a recent e-mail message exchange I had with her, Julianne stated: “My enthusiasm for Mvelopes continues to grow.” I telephoned her and we had a wonderful conversation. Julianne provided answers to the following questions:
Q: How long have you been using Mvelopes?
A: A year and a half.
Q: How has Mvelopes assisted you in living within your income?
A: Well, I was explaining to a friend of mine that it’s not just another budgeting tool. For example, I used Quicken for years and this is nothing like that. There is no other program out there like Mvelopes. It lets you deal with things proactively, rather than reactively. Instead of looking at what you have already spent, it helps you make decisions before you spend. Instead of saying, “Did I get an ‘A’ or an ‘F’ grade?” you can say, “What do I need to do to get an ‘A’ grade?” It really helps us manage our money because we always know right where we are, financially, and we don’t have to worry about whether we have money to pay bills–we know we do.
Q: How much consumer debt have you been able to eliminate during that time?
A: My husband and I have never believed in using credit cards, but have used them occasionally in order to be able to earn bonus points, etc. When we have used them, we promptly pay them off. However, the mindset of knowing that we had the cards to fall back on wasn’t good for us, so we’ve decided to get rid of all the cards. We no longer use credit cards at all.
Q: How much have you been able to save while using Mvelopes?
A: We are self-employed and, admittedly, we haven’t been able to save a lot. However, we aren’t losing ground either and, for us, that has been huge. This has been an incredibly challenging year–both economically, and with the weather. We have a seasonal business and the winter storms in Washington this year have really affected our business. So, for us, being able to pay our bills without going into debt has been a very big accomplishment.
Q: How much has your average checking account balance increased while using Mvelopes?
A: That’s a difficult question to answer because we haven’t necessarily seen an increase in our account balances. However, we have noticed that things have been much better since using Mvelopes. Our business is seasonal and winter is our slow season, with summer being our busiest season and the time when we make the majority of our income. This past year, we were able to even out and manage our cash flow better than we ever have before. We’ve been able to make our money stretch, we’ve timely paid all of our bills all winter long, and we’ve even set money aside for taxes, etc. We had “forward thinking” going into the winter and really planned well. It was so nice to know that we had enough to pay our bills.
Q: What financial goals have you achieved while using Mvelopes?
A: We purchased and paid off our business equipment. Our business paid for itself the first year. We are also first-time home buyers. I have to admit, it was rather frightening to sign the mortgage papers and know that we’re making a 30-year commitment. We’ve been able to meet all of our commitments! We have been diligent to pay our mortgage payments on time every month. Living within our means is very important to us and that is a goal that we are achieving each and every month. My husband and I are both quite frugal in our thinking. We set aside money for our anniversary celebration and we were able to completely relax and enjoy the experience because we knew that we were living within our means and that we had already set aside the money for our celebration. When we do that, it provides amazing freedom.
Q: What are your next financial goals?
A: We would like to gain ground this year in our savings, and we want to be fully prepared for any other economic storms that may hit us. We would like to move from being able to living within our means to having an emergency fund, building our retirement, etc.
Q: How many envelopes have you created?
A: I have 39 envelopes. I really like to be specific. I have a lot of subcategories. For example, under gift-giving, I will have birthdays and Christmas as separate envelopes.
Q: How has Mvelopes helped to reduce financial stress?
A: It has really helped to relieve guilt (which can cause stress). I know exactly whether or not I should be spending. It simplifies the way I think. Do I have money or don’t I? And I have the answers. Our tendency is to not spend money, but it’s so nice to know that if I save money for a manicure, I can make that choice and enjoy the experience-without guilt.
Q: If married, how has Mvelopes helped you better collaborate with your spouse?
A: I manage the finances, so if my husband wants to spend money on something, we create an envelope for it and we plan and discuss what funds are there, or not. It is so simple and it makes the communication so much better. My husband is very supportive.
Q: What advice would you give to new Mvelopes users?
A: I would say, first, let Mvelopes change your mind and let it transform your thinking. It’s a mindset switch. Give yourself a little time to let it work (and experience the change of mind). There will be an adjustment period, like starting a new job or becoming a new parent. Start with small, reasonable goals. It will work for you. Be consistent. You won’t ever go back. We’re told that the most effective exercise isn’t the specific exercise, but it’s whether or not you’re consistent with it. The same rule applies here. Consistency is so important. You are soon going to eliminate reactive thinking. Rather than thinking, “What did I spend?” your thoughts will naturally change to “What can I spend?”
Q: If you could create a “tag line” for Mvelopes–keeping in mind what it’s done for you–what would the tag line be?
A: Free spending, with no magic tricks. It’s just smart!
Julianne, thank you so much for taking time to speak with me about Mvelopes. I truly enjoyed our conversation. You’ve gone from having guilt and uncertainty about finances to having a healthy respect for money. It’s obvious that you’ve gained confidence and know that if you save (budget) for something you want, you can make that purchase–without guilt. I really appreciated the way you explained the simple change in mindset that comes with using Mvelopes. We wish you and your beautiful family continued financial success and much happiness.