App of the Week: Envelopes make a comeback in money management
Back when I was a cadet reporter in Australia, every Thursday afternoon, the staff at News Ltd in Surry Hills, Sydney, would line up outside the pay office. You see, Thursday was pay day, the best day of the week - more so if you were a lowly paid cadet reporter like me and you could barely survive on your salary, let alone wait another week for that prized packet of money.
When it came your turn, the paymaster would solemnly hand over your pay packet and get you to sign for it. It was serious stuff because we were paid in cash in those days. On the front of the envelope, the paymaster had painstakingly written out what your salary was and noted down any deductions, such as tax, which was always a given.
It wasn't long after that technology put paid to the salary envelope, and our pay was then transferred straight into our bank accounts.
The envelope is also something we don't use much of anymore thanks to our preference for e-mailing and texting.
Which brings us to Envelopes (iPhone, iPad, iPod Touch; Dh3.64), an app that uses an old-fashioned concept of budgeting our finances. Apparently, and this was way before my time (despite receiving my salary in a pay packet for a spell), people would work out their weekly, fortnightly or monthly budgets by putting cash into labelled envelopes.
So the week's grocery budget would go in an envelope labelled, well, groceries, cash for petrol would go in another, money for the electricity bill would take up a third and so on. It's a pretty simple concept, but worked well because you'd see the money physically and knew exactly where you were at for the week when it came to tracking your expenses and what you had left over.
Envelopes the app is simple to use. It kicks you off with a few envelopes, such as Holiday, My Treats, Petrol and Shopping, but allows you to create your own to suit your needs. Just tap on the "+" button that is placed in the top right-hand corner of the screen, then tap on "Envelope name" to create a new file.
You can also allocate a certain amount of money to the envelope (below the "Envelope name" button), as well as choose a colour for it. The idea is that the money you allocate each envelope can only be used for that category. So there's no borrowing from Peter to pay Paul, although a little creative balancing of the books can be done (simply by adjusting the amount you've assigned the envelope). Although some would say that's cheating. I haven't yet worked out how to change the currency to dirhams, so at the moment, I'm operating in sterling pounds. And feeling all the more richer for it.
Have some great personal finance apps that you want to share? Write to Personal Finance at firstname.lastname@example.org.