As I was reading through this Sunday's New and Observer, I stumbled upon a reference to Mvelopes in the Wall Street Journal Sunday section by Amy Hoak under an article entitled "Web Sites to Keep You on Budget." Interestingly enough, this is the method Heather and I were featured in the New and Observer for using. Amazingly enough, most of my colleagues and friends had no clue what the envelope system was and I heard more jokes than anything. In fact, my cube walls were covered in envelopes when I returned to work.
But, Amy in her article this morning didn't feel the need to expand on what the envelope system was...so I think it must be fairly cut and dry. She said, "[Mvelopes.com] is based on the envelope method of budgeting, which allocated funds by expense category."
Heather and I use Mvelopes and really enjoy it. We found it off of the Crown Ministries website. I think they have a one month trial, but its quite amazing. Even if, like Heather and I, you use a Credit Card for most of your purchases (hopefully with cash back or rewards)...you can easily allocate those expenses to the individual envelopes. I highly recommend checking it out.