The envelope method in one page

The core idea

You don't budget money you don't have. Envelope budgeting only assigns dollars that have already landed in an account. Every dollar in an on-budget account belongs to exactly one category, or it sits as Ready to Assign waiting for one.

The four rules

1. Give every dollar a job. When money comes in, assign it. If something is left at the end of the assigning, decide what to do with it before you spend it.
2. Embrace your true expenses. Insurance, holidays, car maintenance — set aside a slice every month instead of being surprised when the bill arrives.
3. Roll with the punches. Overspending happens. Cover it from another category, or accept the dent in next month's starting position.
4. Age your money. The goal is to spend dollars that landed weeks or months ago, not the paycheck you got yesterday.

How Project Budget enforces this

• Ready to Assign is shown at the top of the Budget view. It can be positive (money waiting for a job) or zero (every dollar accounted for). It cannot meaningfully be negative; if you assign more than you have, the indicator goes red and warns you.
• Category Available is carry-in + assigned + activity. Green when funded, red when overspent.
• Overspending in an on-budget category is silently covered from Ready to Assign in the next month. The carry-in for that category resets to zero — you don't go into a perpetual hole.
• Credit-card spending uses a paired Credit Card Payment category. When you spend $40 on groceries with a credit card, $40 moves out of Groceries' available and into Visa's payment category. The cash is set aside; the bill is funded.