The envelope method is one of the oldest budgeting tricks, and it still works because it makes spending feel physical instead of abstract.
The idea is simple: you assign a fixed amount of cash to categories like groceries, entertainment, or dining out, and once the envelope is empty, spending in that category stops until next month.
Today most people use a digital version through banking apps that let you create sub-accounts or spending buckets instead of physical cash. The psychology is the same either way, seeing a shrinking balance is a stronger deterrent than a number on a spreadsheet.
This method works especially well for people who overspend in a few specific categories rather than everywhere. It is educational information, not a personalized financial plan.