If you’re a small business owner desiring better business budgeting techniques, you might feel like money comes in and disappears just as fast.

Maybe you’re constantly wondering, “Can I pay myself this month?” — you’re not alone.

Managing cash flow, budgeting methods for taxes, and consistently paying yourself is one of the hardest parts of running a business. Particularly for solopreneurs or early-stage founders.

That’s where the cash envelope system can be an absolute game-changer.

Traditionally used for personal budgeting, the envelope system can also be adapted to your business in a way that’s visual, intuitive, and — dare I say — kind of fun?

And no, you don’t need to carry around actual paper envelopes labeled “Taxes” or “Pay Yourself” in your briefcase. We’re going digital with this budgeting process — with intention.

Activity Based Budgeting: What is the Cash Envelope System?

At its core, the envelope method is about giving every dollar a job before you spend it. That means when money comes in — whether it’s from sales, invoices, or clients — you immediately assign it to categories (aka envelopes) like:

• Taxes
• Operating Expenses
• Owner’s Pay
• Emergency Fund
• Investments or Growth
• Debt Payoff
• Giving or Donations

This isn’t “leftover budgeting,” where you pay expenses and hope there’s money left at the end of the month. Instead, it’s a zero-based budgeting system — where every dollar is assigned upfront.

💬 “It’s not about tracking money after the fact. It’s about making intentional choices with your money before you spend it.” — Jamie Trull

Why Envelope System Budgeting Process Works for Business Owners

Let’s be honest: business finances can feel overwhelming. There are so many moving parts — income, expenses, taxes, payroll, tools, subscriptions, retirement planning — it’s no wonder most entrepreneurs feel behind.

The envelope system simplifies this in 3 powerful ways:

1. It’s flexible budgeting strategies that create clarity.

Instead of lumping all your income into one big checking account (and crossing your fingers that you’re “okay”), you now have visual separation.

You can look into your “Tax” account and know exactly what’s available.

2. It builds confidence and cash flow.

No more wondering if you can afford to hire that contractor or pay yourself. The money is already sitting in its respective category.

3. It supports sustainable business success.

Because it accounts for taxes, owner’s pay, and growth, you’re building a sustainable business model — not just chasing short-term revenue with time-consuming activities.

Business Budgeting Methods: Breaking Down Your Envelopes

Here’s a simple example of how you could split $5,000 in revenue using the envelope system:

Envelope	% Allocation	Amount
Taxes	30%	$1,500
Operating Expenses	40%	$2,000
Owner’s Pay	20%	$1,000
Future Growth	10%	$500

📌 You can customize these budget targets based on your business goals and needs of your company .

A service provider may need a higher owner’s pay, while a product-based business might allocate more to inventory and operations.

Going Digital: No Paper Envelopes, Please 🙃

Back in the day, I used to track this system in a spreadsheet because there was no easy way to manage business finances like this in a bank account.

Traditional budgeting had not yet met the digital business revolution.

That all changed when I discovered Relay — a business banking platform built specifically for small business owners.

Why I Recommend Relay for Business Banking

Relay is one of the only online business banking tools that makes the envelope system not only possible — but simple.

Here’s what makes it so powerful:

✅ Create up to 20 free checking accounts

✅ Set up automatic transfers by percentage

✅ Assign virtual or physical cards to specific accounts

✅ Collaborate with bookkeepers, CPAs, or team members

✅ Earn interest on savings

✅ No account minimums or hidden fees

You can literally build a digital envelope system — where each account functions as its own category.

Automate your financial planning with the PROFFIT System

If you’ve followed me for a while, you may have heard me talk about my PROFFIT Method — which is my twist on Profit First, adapted for solopreneurs and online businesses.

Here’s how I divide my categories:

• P – Pay Yourself
• R – Rainy Day Fund
• O – Operating Expenses
• F – Fun
• F – Future Investments
• I – Impact (charitable giving)
• T – Taxes

You can automate your Relay account to transfer percentages into each of these envelopes weekly, monthly, or based on a maximum balance.

🧠 Tip: Start with rough percentages and tweak as you go.

If you’re unsure, use your bookkeeping or accounting software to understand your master budget and see where your money has been going.

Use This System to Tackle Business Debt Too

Got business debt? The envelope method is perfect for that too.

Just create a “Debt Payoff” envelope and assign a percentage or fixed amount every time income comes in.

Even if it’s small, this builds consistency and a real strategy to curb unneccessary expenses or unnecessary spending.

Not just waiting until you “have extra.”

This is how you pay off debt with purpose.

How to Set Up Relay for Envelope Budgeting

Setting up your digital envelope system in Relay is super easy. Here’s how to do it:

Step 1: Open your free account

👉 Sign up at jamietrull.com/relay — you’ll even get a $50 cash bonus when you fund your first account!

Step 2: Create multiple checking accounts

You can create up to 20 — and name them anything you want (“Taxes,” “Payroll,” “Growth,” etc.).

Step 3: Set up automated transfer rules

Tell Relay how much to keep in your operating account and where to send the overflow. For example:

• Keep $5,000 in operations
• Anything over gets split: 30% Taxes, 20% Pay Yourself, 10% Rainy Day, etc.

Step 4: Use virtual cards (optional)

Assign cards to specific accounts or team members for easy expense control and tracking.

Step 5: Review and adjust monthly

Use Money Mondays (or whatever cadence works for you) to review how much is in each envelope and make tweaks as needed.

Common Questions I Get About This Budgeting Approach

❓What if I already use Profit First?

Perfect! Relay works seamlessly with the Profit First methodology — in fact, their system has templates built-in. You can also use my PROFFIT method or make your own.

❓What if I already have a bank?

You can use Relay alongside your existing bank. They allow free transfers and provide a switching checklist when you’re ready to move over fully.

❓Is Relay safe?

Absolutely. Relay is FDIC-insured up to $250,000 through their banking partner. You can also add team access with their own credentials, so you’re never sharing your bank login.

Real Talk: Why This System Changes Everything

When you’re not worried about whether you’ve set enough aside for taxes…

When you know exactly how much you can safely reinvest in your business…

When paying yourself isn’t a maybe, it’s a scheduled transfer…

That’s when you step out of financial survival mode and into strategic growth.

And the best part? Once it’s set up, it runs in the background.

Ready to Try Relay?

If you’re ready to organize your finances, automate your budget, and start making intentional financial decisions — I highly recommend checking out Relay.

🔗 Sign up at jamietrull.com/relay
💵 Get a $50 bonus when you open and fund your first account!

Want to see how it all works? 👉 Check out my full Relay tutorial.

Final Thoughts

The envelope system might seem simple — and that’s the point. Simplicity gives you clarity. And clarity gives you confidence.

As entrepreneurs, our finances should support our lives, not stress us out.

So if you’ve ever asked yourself:

• “Can I afford this software?”
• “How much should I save for taxes?”
• “Why am I still not paying myself?”

This system is your answer.

*Relay is a financial technology company, not a bank. Banking services and FDIC insurance are provided through Thread Bank, Member FDIC. The Relay Visa® Debit Card is issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa® debit cards are accepted.

** This article is proudly sponsored by Relay Financial. However, all ideas and opinions expressed are entirely my own and are not influenced by any sponsorship arrangements. While Relay Financial has graciously supported this content, the views presented are genuine and independent. Out of respect for our viewers, we only collaborate with companies that we truly believe in. Thank you for reading and supporting the sponsors who make these videos possible.

Video Transcript

Please note that the following is a direct transcript and has not been edited for errors or omissions. It is a verbatim representation of the spoken words and may include colloquial language, grammatical errors, or other inconsistencies. We have chosen to provide the transcript in its raw form to preserve the authenticity of the conversation. We recommend cross-referencing with the original audio or video source for complete accuracy.

💸 The Envelope System—A Business Budgeting Game-Changer

You’ve probably heard of the cash envelope system for personal budgeting, but did you know it can be super helpful for business budgeting too? Yep, I said it. Today I’m breaking down how to adapt this simple old-school method to your business — and spoiler alert: it actually works.

Now, if you’re a business owner that feels like money is just coming in and going out and you don’t know which way is up, this method may be a great option for you. And don’t worry, I’m not gonna tell you to carry around a stack of actual envelopes in your purse. No, no, no. Instead, we are gonna go digital with intention.

👋 Meet Jamie Trull

Hi everyone. I am Jamie Trull, your favorite CPA and financial literacy coach, and I am here to bring you all the resources and tools that you need to manage your business and make sure that you are financially fit.

If you’re not a subscriber yet, why not? Please make sure to hit the subscribe button so you see more content just like this. Now, as always, make sure to stay until the end of the video because you don’t want to miss me talking about my favorite tool to help you automate this entire process.

💼 What Is the Business Envelope System?

But first, let’s start with the basics. What am I talking about when I talk about an envelope system for your business? The cash envelope system is all about allocating each dollar you bring in to a specific purpose. I look at it like giving every single dollar in my business a job.

Now, you might use something like this in your personal life where a certain amount is for home expenses, a certain amount is for groceries, a certain amount is for gas, et cetera, et cetera. And that is actually a really great way to make sure that you are staying within your budgeted means.

🧾 Business Budget Categories That Make Sense

But in business, those categories are gonna be pretty different from what they might look like in your personal life. In business, these may look like things like operating expenses, perhaps taxes, maybe an envelope for reinvesting back into your business potentially, or envelope even for paying yourself.

So there’s lots of different options for ways you can really take your money and distribute it to where you want it to go and give those dollars a job.

❓ Not Sure What Goes Where? That’s Okay!

Now, if you’re not sure how much goes into each of these buckets, that is okay. There are various different methods you can use. So you may have heard of something called Profit First. That’s a book by Mike Michalowicz, and he goes into his system for essentially the envelope method of accounting for your business.

Or maybe if you’ve been following me for a while, thank you. You might be doing my profit planning, which is where you’re taking your money and splitting it up a little bit differently. My categories differ a bit from the Profit First methodology just because of the things that I like to put my money towards as a small business owner. So that may be what you’re doing as well, and this will work for that too.

🧐 How to Know If You Can Afford Something

And my favorite thing about this is that you don’t run into the issue where you’re wondering if you can afford something. So if you’re using an envelope system, the way to know if you can afford something is by looking at how much is in that envelope.

Again, we’re talking about virtual envelopes here, and each of those envelopes basically functions as a little mini checking account that you can use — but only for the intended purpose that you have put it there for. Obviously, there is some discipline involved here, so if you are going to be moving things around when you don’t have enough money in a particular account, that kind of defeats the purpose. So part of the goal is to make sure that it’s something that you can stick to.

📊 My Early Envelope Budgeting Journey

Now I have been using this for budgeting in my business for years. However, I had to do it on a handy dandy spreadsheet. And the reason that I had to do it that way is because at the time, there were not banking platforms that did this. This was something I looked for all over the place when I first started my business.

It existed already in the personal banking world, but it wasn’t something that had made its way into the business banking world, which shocked me, given the fact that business owners are the ones who are really thinking about managing that cash flow or having to pay their own taxes, things like that. And so it seemed to just make sense that a similar methodology would work really well in business.

🏦 Enter: Relay — A Banking Platform That Gets It

And then one day I found Relay. Now Relay has been my absolute favorite when it comes to business banking. It is a platform that allows you to open up to 20 different checking accounts and two savings accounts that accrue interest. And that has been a game changer for my business.

Now, one of the things that I love about Relay is that these are real checking accounts with actual account numbers and routing numbers that you can use for different things. I found that this really helps it to really feel like a true reserve, a true envelope for that specific function, rather than just, you know, moving money around from one pocket to the other. It is truly its own account.

✨ Creating Digital Envelopes in Relay

So this allows you to set up essentially digital envelopes within Relay for your money. And if you wanna know how I set mine up and what accounts I use, you can check out my profit plan system. I have a video going over it, the entire thing right here.

But this is my specific system that allows you to really apportion out your money in a way that makes sense for you, right? You are not the same as everyone else, so why should you be putting the same percentage as everyone else towards different things?

It also is the only budgeting plan I’ve seen that accounts for things like fun and also for giving back and charitable giving to causes that you care about. So definitely go check out my profit plan if you haven’t yet.

🧪 Watch Me Create a Reserve (Demo)

Now you all know that I love for you to be able to see for yourself what this looks like. So I have jumped into the Relay platform just to show you how easy this is.

So if you’re wanting to create another envelope and/or another reserve or another account in your business, it’s as easy as literally clicking on this button, naming it. Let’s say we want it to be the Rainy Day Fund. That’s one of my profit plan funds. And then you can decide if it’s gonna be a checking account — again, you get up to 20 — or whether it’s gonna be a savings account. Okay? So you can choose one of those and then you can hit “Create Account,” and here we go. It’s done. It’s created.

🔁 Automate Your Budgeting with Transfers

And here’s what’s cool too. You can go ahead and transfer funds in. Or you can create auto transfer rules for it. You can instantly create a virtual card. So if you want to have a virtual card, you could actually set limits on spending.

Again, if you need to put those guardrails in there so that you don’t overspend, this is a great way to do it. Or if you want it for various different team members to have access to just one of these accounts, right? Maybe there’s one that they are gonna be spending out of. You can do that. Or you can even order a physical card.

📅 My Weekly Auto Transfer Strategy

But I’m gonna go ahead and do auto transfer rules. So this is one of my favorite ways to automate this entire process. And again, if you’re using Profit First, that’s already gonna be right here and you can go ahead and utilize those. However, if you want to create your own or do my profit planning, you can do that as well. And you can call the reserves anything you want them to be called.

So let’s go ahead. I like this maximum balance rule as well. So this is basically to say, let’s say you have a main operating account and you wanna have a maximum balance in there. And then once it exceeds that balance, you are gonna take that money and apportion it to those different reserve accounts.

This is actually what I do. Essentially, I keep one month’s worth of operating expenses and anything above and beyond there in my account — it’s allocated to these different accounts routinely.

🧮 Example Percentages for Auto Transfers

So what I can do is name this “Weekly Auto Transfer.” I do Money Mondays, so I really like the idea of doing this every week on Monday. But you can change this to whatever you want it to be. And then you’re gonna say how much you want to keep in the account. So let’s say I wanted to keep $5,000 as a base in that account — in my operating expenses — and then transfer the excess balance to wherever.

So I can put it all somewhere. I can add an account. So maybe I want 50% to go to my Opportunity Fund. Maybe I want 30% to go to my Rainy Day Fund, and maybe I want the additional 20% going to my Taxes Fund.

💰 Paying Yourself with Intention

All right, so this is also great too if one of these funds is to pay yourself with. This is a great way to automatically be transferring money in that you can then go in and know exactly how much you can pay yourself, because it’s what’s sitting in the Pay Yourself account.

🎯 What Percentages Should You Use?

Now, if you’re wondering again, what percentages to use — what are the right percentages — my view is that there are no right percentages. You have to figure out what is best for you, what’s gonna help support your lifestyle, support the goals you have for your business, be able to pay your taxes. That’s something to work with a tax accountant on, to determine and to feel adequately like you can save.

In my profit planning system, I also have accounts for things like Fun for your Future — that might be a 401(k) or paying down debt — and for Impact, which is charitable contributions. So again, you can have any number of those and you can also make your own.

🛠️ Fully Customizable for Your Business

If you want to have an Inventory account that you’re putting money aside to just be using to reorder inventory, that’s a great place to be putting your money. That’s a great reserve or envelope account that you can create.

And to me, that’s the best part of Relay — is how customizable it really is. You can use it however best you want to use it that’s going to work for you and is gonna help you really manage the cash flow in your business.

💤 Set It and Forget It (Almost)

It might take a little bit of trial and error to figure out the right percentages, but that’s okay. Once you’ve figured that out, then you can kind of set it and forget it.

And you don’t have to be worried all the time about how much you have to spend on various different things in your business because you can just log in and it’s right there in front of you.

🧾 Easily Save for Debt Payoff

And this is a great way to pay off business debt if you’re looking to do that, because it is so much easier to just have that money taken off and put into an account specifically related to saving up to pay off your debt, and you barely will even recognize it because it’s being done automatically.

✅ A Simple System That Actually Works

Now, I know this sounds like a simple system, and that’s really the point. It really can help you manage your money better, get a handle on where you are. You could log in and instantly see how much money you have in those various different accounts, and it really just simplifies the decision-making process.

And I’m gonna tell you, as business owners, anytime we can take a decision off our plates, anytime we can get rid of that decision fatigue, that is a good thing.

🎁 Sign Up for Relay and Get $50

So if you wanna sign up for Relay, of course I have a special incentive for you. Go over to jamietrull.com/relay right now. You can get a $50 bonus for signing up for an account and funding that account.

You can find more details and terms on that when you go to jamietrull.com/relay. But I’ll tell you, this is the actual business banking platform I use. I don’t just affiliate for them. I actually really like them, and that is why I have partnered with them to bring Relay to you and get a special bonus for signing up with my partnership link.

💬 Like, Subscribe, and Leave a Comment!

If this was helpful, make sure to like and subscribe or leave a comment below if you have a question. And again, go check out more about Relay at the link below.

📺 Watch the Full Relay Tutorial

Plus, if you’re wanting to dive even deeper into Relay and what all the things that it can do are, definitely check out this full tutorial that I did that I have linked right here on your screen.

I’ll see you next time.

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