Mum who saved £17k in a year uses envelope system – ‘absolutely transformed my spending’
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Nicola has used her envelope stuffing system for her savings for a number of years. The mum, who runs the award-winning blog The Frugal Cottage claims the method is responsible for her amazing savings success.
She once saved a huge £17,000 in a year and plans to save £10k in 2022.
Nicola uses a cash envelope system she calls envelope stuffing. She uses the system for her expenses, which she divides into six categories.
Her categories are:
- Eating out
She said: “I like using the envelopes, having different categories and the fact they fit in my purse easily.”
So, how can you emulate Nicola’s savings strategy. The way it works is to take out the weekly budget in cash, then divide up the budget in each envelope.
Depending on the week ahead savers can adjust the split of their budgets, although Nicola does not change the “children” budget as she likes to be able to spend on enriching things for her two sons.
Nicola found handing over cash when paying for things worked better for her as the transaction felt more “real”.
She said, there are positives and negatives to the system, however, she has been using it herself for years.
In 2022 the family are aiming to save £10,000, a plan the mum discussed with Express.co.uk recently.
She told viewers how she will use her envelopes this year to support her plan.
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“The food envelope is one of the two envelopes this year that is going to be really different from last year,” she siad.
“This is because the money that is going to fill it is purely coming from last year’s savings.
“The food budget, in comparison to last year, is going to be really small. It doesn’t change from week to week, that budget.”
Her miscellaneous budget, which pays for things not included in the rest of the envelopes such as cleaning products and food for her cats, is also coming from last year’s savings.
Nicola was thinking about changing to using her card to pay for petrol, as she will be required to drive more with her new job.
The mum previously put £30 in her envelope weekly for petrol, but this year she will need much more in her petrol budget.
She said: “First of all petrol prices are increasing and second of all I’m going to be using pretty much a full tank of petrol each week.”
As for her “eating out” envelope, Nicola says “this will be £0 for pretty much the whole year.”
This envelope includes takeaways and buying coffees out. Nicola is stripping back in this area a lot to meet her saving goals.
Nicola only plans to spend on three eating out events this year, for important family occasions.
“The cash envelope system works really well for reining in your impulse spending. It has absolutely transformed my spending habits, my impulse spending, everything, for the better,” she said.
Nicola’s money journey can also be followed on her Instagram account @thefrugalcottage and on her YouTube channel.
She is aiming to pay off her mortgage early to enjoy mortgage-free living with her family.
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