“When you budget for ‘fun spending,’ there is no guilt in spending it!”

Olga and her family

Olga and her family

Olga, from Portland, Oregon, shared the following comments about her initial experience with Mvelopes.

“My husband was skeptical when I first introduced the Mvelopes system to him. We have tried budgeting before and quickly gave up because we became tired of writing down multiple transactions, etc. He recently told me that he really likes this new budgeting system because, for once, he has his own ‘envelope’ and he can spend the money, guilt free, for things he’s always wanted. Of course, when you budget for ‘fun spending,’ there is no guilt in spending it. I am glad he is onboard with me. Thank you, Mvelopes!”

I decided to make a telephone call to Olga so I could get more information about her Mvelopes’ experience, and we had a delightful conversation, as follows:

Q: How long have you been using Mvelopes?

A: I started last March, so just less than a year.

Q: How has Mvelopes assisted you in living within your income?

A: It gives a clear picture of what the income is and what the categories are for spending. We have a clear picture of what’s coming, what’s going, and what’s left before the end of the month.


Q: How much consumer debt have you been able to eliminate during that time?

A: In the past, we always tried to pay our credit card balances off at the end of each month, but sometimes we weren’t able to pay the cards off in one month. We now pay off the credit cards each month—always—and we don’t depend on the credit card for purchases. We just don’t rely on credit cards any more.

Q: How much have you been able to save while using Mvelopes?

A: We have saved approximately three months’ worth of expenses now, which makes me feel excited that we’ve come this far, particularly in this economy. We’ve always understood the concept of not living paycheck to paycheck, but we didn’t know how to make that happen. We now have the tools. Mvelopes gives us a clear picture so we now know how to do it.

Q: How much has your average checking account balance increased while using Mvelopes?

A: It has at least tripled. Some time ago, I noticed that our balance hadn’t fallen below $1,000 for awhile. Our credit union offers a “checking plus” account that allow you to earn interest, but you have to maintain a $500 minimum. After using Mvelopes, I saw a pattern that our balance was no longer below $1,000, so now we’re earning interest. I no longer have to worry about the balance.

Q: What financial goals have you achieved while using Mvelopes?

A: We have a 3-year-old son and we’ve started a college fund for him. We knew that starting a college fund was the right thing to do, but prior to using Mvelopes, we couldn’t have done it. Now we have $3,000 in the fund and as we watch the balance grow, it makes us feel that we’re really getting somewhere. We also have savings for a rainy day—it’s a cushion, and it makes us feel better.

About a year ago, there was talk at my work that we may have to look at having a reduced work week (going from a 5-day work week to a 4-day work week). Prior to using Mvelopes, that would have been just plain scary. Now, if there’s a change in my schedule and my income is reduced, I know we’ll be just fine.

Another thing we’ve been able to do differently since we started using Mvelopes is increase our donations to our church. We actually have a “donations” envelope for this purpose, which is part of our monthly budget. Our church has an excellent “food cupboard” ministry that allows families in our neighborhood to come and pick up food baskets in their time of need. I’ve always felt the need to help others who are less fortunate, but now I can put my money where my mouth is. It makes us feel like we are being better neighbors in our community.

My whole relationship with money is changing. Even though our savings account is getting bigger, I don’t feel like spending that money—not like we used to. Having savings in the bank makes us feel we have more options in our lives.

Q: What are your next financial goals?

A: We are working toward building up our savings so that, down the road, we’ll be able to afford to buy an energy-efficient car and pay cash for it (something unheard of for us). If we keep going the way we’re going, we’ll get there. We are going to go on vacation to Disneyland and we don’t want to finance it with a credit card—we want to have it fully paid for before we go, and that goal should be fairly easy to accomplish.

Q: How many envelopes have you created?

A: We have about 25.

Q: How has Mvelopes helped to reduce financial stress?

A: There is clarity about what we have, what the money is budgeted for, what is left (so we don’t have to be nervous). We used to just judge how much money we had based on our checking account balance, and we’d try hard to remember what else we might have coming up. We have “must have” envelopes for the bills, but then my husband and I each have our own money. Before using Mvelopes, we would just spend money on ourselves and then we’d often feel guilty about it. But now we don’t have to hold each other accountable. I have my own personal spending envelope and my husband has his, and we use that money for whatever we want. Now my husband can buy his computer games, and I can go out with my friends or get pedicures, without worry or guilt.

Q: If married, how has Mvelopes helped you better collaborate with your spouse?

A: I have always been frugal. Now, instead of having a discussion with questions like, “Can we afford it?” my husband and I can just log into our Mvelopes account and make decisions based on our account balances. We no longer have to monitor or police each other! The Mvelopes system polices us—this is what we have, this is what we don’t have. It’s more a comfort level. We collaborate on how much each envelope should have and we make suggestions. We no longer argue about money. I told my husband the other day that I’m so used to having this clarity about the purpose for each dollar that if the system were to be taken away, I would be totally blind again.

Q: What advice would you give to new Mvelopes users?

A: If you’ve never budgeted before, you need to spend some time and not expect it to be smooth immediately. Give yourself a couple of months—a couple of cycles. Be patient. Use support (I used it a lot in the beginning). Once you figure things out and it starts operating smoothly, it’s very easy. I have a friend who does not budget and I know she has difficulties—like most of us do when we don’t budget. She claims that she shops for bargains, clearances, and sales, but that’s just not enough. You have to know how much you have to spend and you have to know when to stop spending, too—even if something is on sale.

Olga, thank you for sharing your insight, wisdom, experience, and tips with us.  At the rate you’re going, you’ll own that new car soon!  We wish you and your family continued financial success.