This system involves using cash in various envelopes or other containers marked for the different expense categories you set up. There is a definite danger in keeping cash at home even in a home safe, so while this system is the simplest, it is also the most dangerous. A running account of expenses can be noted on the outside of the envelopes.
While the envelope is convenient and simple to use, it takes a lot of will power not to "rob" one envelope when another is empty. There is also the risk of loss or theft of the cash.
Another version of the envelope system, is to use the envelopes to store receipts. Record the budgeted balance on the outside of the envelope, and subtract each time an expense is made in that catagory. You will have a running balance of how much is available in that catagory.
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