How does the envelope or cash-stuffing method actually work?

The envelope method splits your discretionary spending into physical or digital 'envelopes' – groceries, dining out, gas, fun – and once an envelope is empty, you stop spending in that category until next month. The constraint is the feature: handing over cash, or watching a labeled balance drop, makes spending feel real in a way a tap of a card does not. Cash-stuffing is the all-physical version that has trended online, but you can replicate it with separate sub-accounts or a budgeting app's categories. It shines for people who consistently overspend in a few specific areas. The downside is that cash earns nothing and can be lost, so many people keep it digital. Try it on your two leakiest categories first rather than your whole budget.