Check out these free money envelopes for kids, which will help them spend cash by category (and stick to their budget).
After your child sets up their budget, they’ll need a way to spend that money.
And not just spend that money, but a way to organize their cash so that they’re not spending what’s supposed to be saved, nor dipping into funds meant for one thing to pay for an impulse item at the checkout counter.
Most kids are not using plastic to pay for things (and, I would urge them not to anyway because it’s harder for them to grasp the meaning of money and how it works if they use a plastic card to pay for things).
That means they’ve gotta spend cash here and there for the things or experiences that they want.
Today, I want to go over one system your child can use to organize and spend their money by category: kid budget envelopes (aka, money envelopes for kids).
What is the Money Envelope Budgeting System?
Before we dive into why you might want to introduce a cash envelope system to your kids for budgeting purposes, let me briefly go over what the cash envelope system is.
A cash envelope budgeting system takes your written budget plan, and translates it into actual cash in category-specific envelopes so that you can track your spending by category.
You take cash out of your bank account and fill each envelope with the money you intend to spend for that particular category.
So, you could have an envelope for food, an envelope for fun, an envelope for gas, etc.
As you spend money throughout the week and month, you take your envelopes with you and jot down how much you spent from that envelope (so that you can track how much you have left).
When the money is gone, it’s gone, until the next fill-up (refill day).
So why would your child be helped by this?
Why Use Money Envelopes for Kids?
After a child creates their budget, they need to “express” that budget in real terms. Like, in the day-to-day.
Which means they’ll likely be carrying around cash at certain points – perhaps not every day, like us adults do – to make store transactions.
By giving them envelopes to categorize various spending categories, it helps them:
- Put a hard stop on overspending the amount they meant to for a particular category
- Be able to visually see how much money is left in a particular category for a duration of time (for the week, until payday, for the month, etc.)
- Keep your spending money away from your saved money (physical separation of these two works best for us adults, too!)
Also, these envelopes can have other uses – because let’s face it, your child doesn’t have a ton of category-specific spending they need to do each week or month.
Other Kid Cash Envelope Uses:
- Specific store transactions: You could help your child not make impulse purchases by printing out a kid cash envelope each time they’ve saved and are ready to make a store transaction, and writing the specific item they saved for on the outside of the envelope.
- Christmas money budgeting: You can print out a different envelope for each person your child is going to buy for, to help them stay within their spending budget per person (and avoid running out of money before they get to someone on their list!).
- Event-specific budgeting: Maybe you don’t want your child to routinely handle money. Instead, you can help teach them budgeting by letting them handle the money for a specific event you’re having (like a BBQ, graduation party for an older sibling, back-to-school shopping, creating a vegetable garden, vacation spending money, etc.). They can print out a set of envelopes, and categorize spending for the event, and work on budgeting that way.
Cash Envelopes for Kids – Category Ideas
Let’s face it – coming up with spending category ideas for adults is wayyyy more intuitive than figuring out categories for kids.
Because adults spend money daily, weekly, and monthly on all of the living expenses we have to maintain our lives!
So, I wanted to give you some category ideas for cash envelopes for kids.
- School activities
- Special events
- Hangout with friends
- Savings goal (video game, new toy, book in a series, etc.)
- Store money
- Christmas spending money (for siblings, family, etc.)
Now that you can see some of the possibilities for kid cash envelopes, I want to show you several free printable cash envelope PDFs.
Money Envelopes for Kids
Let’s dive into some free kid money envelopes to get to help your kids with managing their money.
1. Money Envelopes for Kids
Of course I’ll kick off with my own free set of printable cash envelopes (PDFs)!
Work with your child to fill out a budget (here are those free kid budget worksheets and teen budget worksheets), and then print out as many of these as you need to represent each category of spending.
I would also take this a step further, and laminate them.
Well, you don’t want to have to keep printing out new ones each week (ouch – that would eat up a lot of printer ink!). Instead, get one set laminated, then buy these ultra-fine dry erase markers.
Hint: if you find that the dry erase marker writing is getting accidentally erased when it bumps into something, like in your kid's wallet or purse, then get a set of fine wet erase markers. They'll only erase with a damp cloth. Here's the set I have.
Your child can use these for each budget cycle, and then simply erase and start over when it’s envelope refill time.
Carrie Elle offers printable cash envelope money trackers – you print them out on either sticker paper, or on regular paper and then glue/tape them to the front of white envelopes.
*no optin required
Queen of Free has a very simple set of printable kid budget envelopes that act more like give, save, spend jars (as opposed to various categories for spending money).
I like how each envelope has an inspirational quote on the back of it.
Let’s dive into some tips for kids and teens getting started with money envelopes.
Hint: for the “give” category, I've created this list of 10 charities kids can donate to where $12 or less makes a big difference.
Kid Cash Envelope System Tips
A few tips to help your child get started with using a cash envelope system.
1. Have them Fill Out a Budget Sheet
A budget worksheet goes hand-in-hand with money envelopes, because the budget worksheet helps your child calculate how much they have to spend for each category, based on the total amount of money they have (for a specific period of time, like each allowance cycle, or each week).
Not to mention, it gives them space to also set aside part of their money for their savings space.
2. Refill Often
When kids first start the budgeting process, it’s important that they don’t try to go tooooo long before they can replenish their budget categories.
That’s because, while some kids are natural savers and won’t spend all their money, many kids have low impulse control.
And you don’t want them to get so frustrated with the process that they give it up altogether. I would recommend refilling the envelopes at least weekly (you can work this out on a budget worksheet).
3. Let them Feel the Consequences
Ever heard of natural consequences? It’s letting your child feel the actual, natural consequences that occur because of their actions and decisions.
So long as you aren’t having them pay for needs with the envelopes, try not to rush in and save them if they’re $0.50 short at the store, or out of money, or in debt to their brother/sister because they overspent last week.
Instead, talk to them about how they think they can fix the situation, and give any advice you can (try to hold back the “I-told-you-so” face…I know, I know, it’s hard to do as parents sometimes, right?).
Being able to track and reflect on their spending is one of the 119 money management skills for kids I recommend they start working on.
4. Find a Place for the Coins
You’ll likely notice that it’s hard to keep coins in each individual envelope.
And that’s an issue for kids, who are using much less money than adults – coins really matter! One way you can get around this is to include one of these teensy, tiny plastic bags in each laminated envelope for coins. That way, it’s harder to lose them.
Another idea is to keep all the coins in one slot with a zipper, and then they’ll just have to take out as needed (envelopes that offer spending tracking are helpful with this).
How your child uses this system and what they need to make things work for them will only be discovered by them actually using these free money envelopes for kids. SO jump in, and help your child get started! Just don’t be afraid to tweak as needed.
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