While taxpayers are collecting receipts and getting ready to file returns, there’s often the realization that another year has passed and they’re no closer to reaching their financial goals. We have clients who feel money is just trickling out of a hole in their pockets but they’re not really sure where it’s all going or why there is nothing left at the end of the month.

Meticulously measured budgets and long tallies of receipts are not the answer for everyone. If you have patience and discipline to do that, you probably already know where every penny is going so you don’t need a system to get your cash flow on track.

But for those who do need help, Sheila Walkington, co-founder of the Women’s Financial Learning Centre and one of Canada’s first Money Coaches introduced what is seen by some as financial heresy: Forget keeping track of what you’ve already spent and look to the future.

Now before you take this as a carte blanche blessing to run up that credit card and dive into the overdraft, Sheila and our associate money coaches put some strict parameters on the process.  It goes back to the old days of putting money into envelopes to make sure everything – from groceries to the gas bill – got paid. When payday rolled around, you’d put cash for food in one envelope, money for the phone bill in another, savings towards new clothes for school in yet another and so on.

Consider the case of one of Sheila’s clients, who confessed to almost cancelling her post-Christmas appointment because she didn’t want to admit just how high her Visa bill had climbed, “I had no trouble putting together a budget based on what I had spent,” she said. “I was spending more than I was bringing in and when annual expenses rolled around, it was a scramble to find enough money to pay them.”

Sheila’s formula? A spending and savings plan that makes you put your money where your priorities are. And it uses no fee high-interest accounts that are offered by banks such as the Royal Bank or ING Direct to recreate these “electronic” envelopes – so the car insurance money gets saved and not spent on pedicures, the account for university fees adds up instead of being drained by car repairs or other unexpected expenses. And the vacation budget, often a priority but usually the first to be sacrificed to overspending in other areas, gets left alone, safe from impulse shoe buying or unlimited lattes.

In effect, it doesn’t just give you a budget to follow. It forces you to limit your spending in each category to the amount you have in the account. If you’ve determined that it costs you $800 a month for groceries and by the third week you’re down to your last $60, no seeking solace in the credit card or pilfering other accounts. Get out the recipes and use up what’s left in the cupboard.

For the client who was stuck in overdraft, it took some discussion and hard decisions to set priorities. She opted for several accounts, because if there was money in a single account that had to cover several long term items, there was a temptation to borrow from it with the expectation that money would magically appear to fill the account by a bill’s due date. Other clients may choose to manage with fewer savings accounts, but the key is to create clarity. Do I have money for clothes or not? Have we spent the dining out money or is there still some left for Friday night?

The payoff can be huge. And not just in terms of money but in peace of mind. “The first time my annual insurance bill came around and I actually had enough money in a savings account to pay it I realized it was working,” said Sheila’s client. “And when I was able to plan a vacation and pay for it instead of putting it off or putting it onto my credit card, I was thrilled. The spending guilt was gone. Now it’s easy to make financial choices — I can walk by Manolo Blahniks on sale and keep walking because I know if I spend money on them, there goes the trip to Hawaii.”

Is a budget just not working for you? Check out our Smart Money Essentials free Preview class and learn more about how to make a Spending and Savings plan work for you.