Definition
The cash-envelope method's modern name: withdraw spending money in cash and divide it into labeled envelopes, one per category. When an envelope is empty, that category is finished until next payday.
Why it matters
Cash makes spending physical again: handing over bills registers in a way tapping a card does not. For overspending in specific categories, the hard stop of an empty envelope beats every app notification.
Example
After the bills are paid digitally, someone withdraws $500: $250 for groceries, $150 for gas, $100 for fun. On the 26th the fun envelope is empty, so the last week costs $0 in fun, and the plan holds without willpower.
Put it into practice
Related terms
This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.