Unless you were living under a rock last New Year’s you read about the 2014 savings challenge, maybe even some of you participated, but did any of you finish? This year, we are putting a twist on a 52-week savings challenge, one that is more obtainable AND will make your money work for you.
2014’s version went something like this:
Social media feeds were abuzz about this 52-week challenge, bottom line, you were challenged to save $1,378 during the year by doing the following:
- Saving amount increases each week You start by adding $1 to your savings during week one, $2 week two, adding a dollar each week until the last week of the year you are putting in $52 dollars. So for example one week 29 you are adding $29.
- Put the money in a jar somewhere that is visible each day, say the kitchen counter. The idea behind putting the money in a jar is so you never forget to add your money each week.
The theory behind this savings challenge is a good one, however there are a few downfalls of last years version:
- Amount increases each week This means that you will have to save the most between November and December when you’re attempting to budget for the holidays. I don’t know about you but all of my extra funds go towards gifts and holiday travel come December.
- Money in a jar By storing your money in a jar you’re not having your money work for you, missing out any interest that would be gained from a savings account.
Aside from the downfalls the overall idea of building more savings is a great one, here is an improved version of the 52-week challenge:
- Saving decreases each week, this means you start with saving $52 during week one, $51 week two, and so on and so forth, by the month of December you are only needing to save $10.
- This option is much more obtainable than attempting to put $202 into savings during the heart of the holiday season.
- You will see results right away, by the end of January you will have saved $202. This alone will encourage you to continue to save throughout the year.
- Additionally, you will compound more interest due to the fact that you are putting in a larger sum of money in upfront, saving more money than the original goal of $1,378.
- Put your money in a high yield savings account instead of a jar.
- You are much more likely to dip into your savings if it’s right in front of you. Don’t have enough for the babysitter or pizza delivery? Chances are you will take money out of the jar and never replace it. Opening an online savings account will help curb the desire to draw from this account.
- When putting your money in a high yield savings you are making that money work for you, gaining interest each day.
- Set-up a weekly transfer to this account.
- By setting up an automatic debit you will never forget to contribute to this savings plan.
- Automatic transfers will help you stick to your budget and of course this particular savings challenge.
This type of savings challenge will allow you to do whatever you wish at year’s end, travel? Invest? Keep saving? Whatever your wish, a simple savings goal will get you there much faster than you think. Happy Saving!