Having a strong savings account is a great financial asset. A savings account can prevent you from having to apply for risky loans when you’re in financial trouble. But, in a world where you can buy anything with a tap on your phone, how can anyone save money? It may seem difficult, but creating a savings plan is one of the best financial decisions you can make.
If you’re new to saving money—or need to pump up your current savings—try a 6-month saving challenge.
In this blog, we’ll talk about your savings and how you can build them fast with a money-saving challenge. Money-saving challenges put a new spin on saving the money we need to achieve our financial goals.
If you’re ready to have a little fun and save more money, read on to learn all about some money-saving challenges!
The 6-Month Challenge
Before launching into other more aggressive challenges, the 6-month challenge is a way to ease into the financial habit of saving money.
Each week, commit to doing at least one thing that saves money. It could be anything, from fun to transportation. For example, think about taking the bus instead of driving a few miles to work or carpooling with a friend or family member. Additionally, do everything you can to avoid unnecessary spending.
Other Money-Saving Challenges
Once you get into the groove of saving, here are other money-saving challenges that may fit your lifestyle and help you quickly save money.
The 52-Week Money Saving Challenge
This money-saving challenge has you save a dollar for every week of the year.
Your contribution is equal to the week “number:”
- Week 1: Put $1 into savings
- Week 2: Put $2 into savings
- Week 3: Put $3 into savings
You keep upping your deposit until you reach $52. By that time the year is up, the 52-week money challenge will save $1,378.
The Penny Savings Challenge
Loose change like quarters, nickels, and dimes are still pretty valuable for vending machines and parking meters, but no one likes carrying around pennies. Instead, collect that copper in a spare jar. When it fills up, take it to your bank. If you have a big jar, you’ll be impressed with how much you’ve saved.
If you want a bigger payout, then step the penny challenge to a spare change challenge, where you save all of your loose coins over a year.
No Eating Out Savings Challenge
Eating out is one of the biggest drains on your money. Whether it’s fast food or fine dining, the average household spends over $3,000 on eating out.
For one month, avoid the usual take-out nights with a “no eating out” challenge. Of course, you’ll still have to eat, so you won’t be able to save all the money. But, it’s cheaper to cook at home than to eat out, so you will have extra money that can go towards your savings goals.
Don’t Spend It. Save It.
The “no spend” savings challenge requires you not to spend any money over a short period. For example, an ideal “no spend” stretch would be a long weekend—a time where you might be likely to spend frivolously.
This money challenge is all about helping you save the money you don’t spend. But, it doesn’t mean that you aren’t supposed to live your life. Use the time to get creative and discover ways you can have fun without spending a dime. But, be sure to use common sense with this money challenge. If you have an emergency financial issue pop up during your challenge time, take care of it.
Tips to Build Your Savings
A money-saving challenge will certainly jump-start your savings efforts, but it’s only part of the battle.
Build a Budget
If you’re having trouble saving money, it may be because you aren’t using a budget. When it comes to financial habits, this one is just as important as your savings.
A budget is a financial overview that details the total amount of money you need over time. Budgets typically plan out your monthly expenses and can be used to create a plan for your savings, too. It’s a great way to get a handle on your spending habits and start saving money while planning out long-term goals.
Start budgeting by adding up your total monthly income after taxes. Then, write down your bills and their due dates. This action will give you a clear picture of your financial obligations for the month. There are also free printable worksheets online and tons of budgeting apps available that will keep track of these numbers for you.
In addition to your “must pay” bills (like rent, utilities, etc.), including a contribution to your savings. It doesn’t have to be a big one at first. But, it needs to be consistent.
If you follow, review, and adjust your yearly budget month after month, you’ll see your financial life become a bit more manageable. Your bills will get paid, and most importantly, your savings will steadily grow.
Use Bill Pay
Once you identify your recurring expenses, set them up on automatic payments. Utilities like electricity and water and insurance and loan payments are always due on the same date. You can set a plan up with your Creditor using your bank account information; just about every company offers some “easy payment” option. Or, you can have your bank send payment on a specific date from your account. Whichever option you choose, be sure to have the total amount of the bill available in your account on or before the due date. Otherwise, you run the risk of overdraft fees, disconnected services, or both.
Set Up Automatic Savings Deposits
Many financial institutions have direct deposit programs that allow you to split your paycheck to put money in as many separate accounts as you like—provided that the accounts are all at the same bank or credit union. In most cases, you can set either a specific amount of money or a percentage of your income to go to your savings account.
Automatic banking options take the thinking out of saving money. You don’t have to remember to make deposits or decide how much money you’re going to put away. And more importantly, you aren’t able to spend money you aren’t supposed to spend.
Talk to your employer about setting up a direct deposit paycheck plan that sends some money to your savings account each pay period.
Create an Emergency Fund
An emergency fund is a reserve of money used to cover unexpected financial needs. Things like unforeseen medical issues, car repairs, and job loss can wreck your budgeting—if you are not prepared.
Learning how to build an emergency fund is one of the best ways to keep your savings goals on track. Instead of depleting your savings, your fund will be the resource you’ll use to handle surprise expenses.
Ideally, your emergency fund should cover three to six months of expenses. If you have underlying medical conditions or dependents (like your children), you should plan for a more significant fund that covers at least one year. Your fund will start small, but as it grows, so will your safety net.
Money-saving challenges are an excellent way to get you into a good financial habit. Saving more money is a simple task, but it isn’t always easy to stay on track. Whether it’s a money-saving challenge, budgeting app, or financial advisor, explore the tools that can help you save money for the future. Taking on a money-saving challenge will give you the financial resources to tackle other challenges in life.
If you’re currently struggling to make ends meet and you don’t have any savings, there are solutions. Many people turn to personal loans in these types of situations. If this is something you’re considering, make sure you do plenty of research. A quick cash loan that you apply for online may be right for you. Just make sure that it’s the best option for your current financial situation.