Understanding Categories

Categories are the heart of envelope budgeting — they're the "envelopes" where you allocate your money. Each category represents a different purpose for your money.

What is a Category?

A category tracks:

• How much you've budgeted (assigned)
• How much you've spent (activity)
• How much is available (assigned + carried over - spent)
• Money carried over from previous months

Category Groups

Categories are organised into category groups for better organisation. Each group has a colour for visual distinction in the budget view.

Example Structure

Bills (blue)

• Rent/Mortgage
• Utilities
• Internet
• Phone
• Insurance

Daily Living (green)

• Groceries
• Gas/Transportation
• Household Items
• Personal Care

Savings Goals (purple)

• Emergency Fund
• Vacation
• New Car
• Home Repairs

Fun Money (orange)

• Dining Out
• Entertainment
• Hobbies
• Subscriptions

Creating Categories

1. Navigate to the Budget page
2. Click "Add Category" in the desired group
3. Fill in:
   • Name: What this category is for
   • Emoji (optional): A visual icon for the category (e.g., groceries, house)
   • Category Group: Which group it belongs to
4. Click "Save"

Emoji Support

Each category can have an emoji displayed alongside its name. This makes categories easy to scan at a glance in the budget view and in reports.

Creating Category Groups

1. Navigate to the Budget page
2. Click "Add Category Group"
3. Enter a name and choose a colour
4. Click "Save"
5. Add categories to this group

TIP

Think about how you naturally organise your spending. Common groups: Bills, Daily Living, Debt Payments, Savings Goals, Fun Money.

Budgeting to Categories

Each month, you allocate money to categories:

1. Go to the Budget page
2. Select the month
3. Click on a category or use the budget input
4. Enter the amount to allocate
5. The available amount updates automatically

The Goal: Zero-Based Budget

Try to allocate all available money until "Available to Budget" reaches $0. This means every dollar has a job!

Category Balances

Available Amount

The current amount available in this category:

Available = Assigned + Carried Over - Spent

Positive Balance

You have money available in this category. You can spend up to this amount.

Negative Balance (Overspent)

You spent more than was available. You need to:

• Move money from another category to cover it
• Budget more money next month to recover

Negative Rollover

By default, negative balances do not carry forward — overspending is absorbed in the current month. If you want a category to carry its negative balance into the next month (e.g., for debt tracking), enable Allow Negative Rollover in the category settings.

WARNING

Overspending in one category means you have less available overall. Cover overspending by reducing other categories.

Moving Money Between Categories

When you need to adjust your budget mid-month:

1. Find a category with excess funds
2. Reduce its budget by the amount you need
3. Increase the budget in the category that needs more
4. Your "Available to Budget" stays at $0

INFO

Example: You budgeted $200 for groceries but only spent $150, and dining out needs $30 more:

• Reduce Groceries by $30 (now $170 budgeted)
• Increase Dining Out by $30

Category Targets

Targets help you budget the right amount each month. Set a target on any category to see how much you still need to assign.

Save Up To

Save toward a specific amount by a deadline. Zenvilope calculates how much to assign each month to reach your goal on time.

• Target amount: The total you want saved
• Deadline: When you need the money
• Allow spending: Whether spending from this category is expected (e.g., an emergency fund you might dip into vs. a vacation fund you'll spend all at once)

Match Spending

Budget based on what you've spent historically. Useful for variable expenses like groceries or fuel.

• Lookback months: How many past months to consider
• Calculation: Use the average or highest month
• Modifier: Adjust by a percentage (e.g., 110% to add a 10% buffer)

Repeat Amount

Budget the same amount on a regular schedule. Good for fixed bills.

• Frequency: Weekly, monthly, or yearly
• Due day: When the expense is due
• Ignore carryover: Whether leftover funds from last month should count toward the target

Credit Card Payment Categories

When you create a credit card account, a Credit Card Payment category is automatically created and linked to that account. This is a system-managed category — it tracks the available amount to pay your credit card bill. You don't manually budget to it; it accumulates as you categorise credit card spending.

Archiving Categories

When you no longer need a category:

1. Make sure the balance is $0
2. Archive the category (preserves history)
3. It won't show in your budget but transactions remain

TIP

Don't delete categories that have historical transactions — archive them instead!

Hidden Categories

Some special categories are created automatically:

• Credit Card Payment categories (one per credit card account)
• Uncategorised: Transactions without a category

Best Practices

Be Specific

"Groceries" is better than "Food" (split dining out separately)

Be Realistic

Budget what you actually spend, not what you wish you'd spend

Review Monthly

At the start of each month, review what worked and adjust

Use Targets

Set targets on recurring expenses so you always know how much to assign

Next Steps

• Learn how transactions affect category balances
• Understand budget months and allocation
• Review envelope budgeting concepts