4 Money Saving Challenges Anyone Can Do

4 Money Saving Challenges Anyone Can Do

The average American household carries more than $137,000 in debt.

As part of that economic reality, most Americans have less than $5,000 in their bank accounts. That’s at least one quarter less than the recommended amount.

Writing about financial independence, people often ask me “how do I get started with saving”? Well, it’s actually quite simple. You stop spending money.

However, not everyone can find motivation to save money. This is why I believe certain people can benefit from a money saving challenge. I even tried a few myself when I started saving money.

A money saving challenge can help you build an emergency fund or save for big purchases like a home. By participating in these challenges you can do at home, you make saving money fun and easy. It’s really all about “gamificating” your savings.

For some ideas on where to start, use one of these four money saving challenges as inspiration.

4 money saving challenges

A money saving challenge can help you start building your savings when you don’t know where to begin. They keep you motivated and on track.

But more than that, they give you an opportunity to develop the habit of saving money. In the long run, it’s those habits that are going to help you save for major purchases like cars and homes – or simply become financially independent.

1. Classic 52-week savings challenge

If you’ve been researching how to save money for more than an hour, then you’ve probably read about the 52-week savings challenge. It makes saving money easy because it spreads it across the course of one year.

In this challenge, you put away a specified amount of money every week, for every week of the year. The amount you put away increases in relation to what week of the year it is. For example: in week one you save $1, in week two you save $2, and so on.

The 52-week savings challenge results in $1,378 by the end of the year. It’s not enough for a down-payment on a home, but it’s certainly enough to e.g. kickstart your emergency fund.

But there’s more than one way to complete the 52-week savings challenge. You might choose to attempt the reverse 52-week challenges or even the mini challenge.

If the above example numbers are too low or high for you, then just divide them by 2 or put an extra zero behind the target.

Reverse 52-week challenge

The 52-week challenge requires you to put away the highest amounts in December. At this time of year, many people have to buy gifts for the holidays, which makes it difficult to save the $200 required for that month.

The reverse 52-week challenge is exactly what it sounds like. You end up with the same $1,378 by the end of the year, but you go about it the opposite way and save a decreasing amount each week.

In the first week, you save $52, in the second, you save $51, and so on. In fact, starting off with $200 in savings after your first month may inspire you to increase the amount you save every week.

Mini 52-week challenge

For some people, the thought of saving $200 in one month is overwhelming. Depending on the state of your finances, or what your savings goals are, you might opt to try the mini 52-week challenge.

In this challenge, you halve the amount you save every week. Instead of saving $1 in week one, you save $0.50. The second week, you’d save $1 instead of $2.

The result is half the amount you get at the end of the full 52-week challenge: $689. That’s a good beginning to saving money when you’re looking to start off small.

2. Bi-weekly or monthly saving challenge

For some people, basing savings around their paychecks makes it easier to save. If you choose this method, be sure you withdraw the amount as soon as you receive your paycheck to build a routine of putting money away. You might even consider setting up automatic withdraws so you never “forget” to move the money into your savings account.

In this money challenge, you take a fixed or increasing amount off of the 12-26 paychecks you receive in any given year. The dollar amount could increase in relation to each week, but you only save the amount when you get paid.

Although it’s a good place to start, consider increasing that amount according to your savings goals. I still use this techniques when I pay myself first each money and invest the money.

3. 12-month challenge

Everybody should have an emergency fund, and the 12-month challenge gives you a good starting point. In 12 months, you’ll have amassed just over $1,000 ($1,050 to be exact).

The 12-month challenge is suitable for people who get paid monthly. But it also fits nicely for anyone who prepares their budget on a monthly basis.

In this money challenge, you put aside a set amount for every month according to the following schedule:

  • January: $25
  • February: $50
  • March: $75
  • April: $100
  • May: $125
  • June: $150
  • July: $150
  • August: $125
  • September: $100
  • October: $75
  • November: $50
  • December: $25

The 12-month money challenge helps you save a significant amount while accounting for the more expensive month of December. It also gives you the chance to recuperate from any overspending in December by making January and February’s amounts among the lowest.

4. Piggy bank method

Also known as the spare change/dollars money saving method, this challenge can be done effortlessly. We call it the piggy bank method because it’s reminiscent of how you saved money as a kid.

Every time you get spare change, place it in a jar – or even a piggy bank. You can do this over the course of a year. You’d be surprised how quickly those small amounts add up.

To save even more money using this method, increase the amount you dedicate to the jar. Perhaps you put all your $1 and/or $5 bills in there as well.

Not quite ready for a money saving challenge?

If you’re not quite ready to save as much as $600 or $1000 or even $10,000 with the above money saving challenges, there are small things that can help get you there. These are habits and practices you can implement today with very little thought or effort.

Financial apps

Some banking institutions have tools to help you save money that you can implement with no cost. These resources help you save money without making any lifestyle or habit changes.

For example, some banks have accounts that will round your purchases to the nearest dollar. The difference then goes into a savings account without you having to think about it.

Friendly competition

A little friendly competition never hurt anyone, right? If you’re a competitive person, setting up a challenge between you, a friend, and/or a family member might help motivate you to save some money.

Set up a money-saving challenge for a specified time period: a week, month, or year. Create terms and make sure there’s a reward or prize at the end. Involving other people in this way is a great way to capitalize on that competitive personality while saving some extra money.

Limit spending

Limiting your spending sounds like a drastic change, but it doesn’t have to be. Try limiting your spending for a period of time.

For example, take 10 or 15 days wherein you don’t spend money on any discretionary items. Then, whatever you have left after paying for necessary items like food, gas, and bills can go into a savings account.

Limiting your spending for brief periods can help you learn the difference between what you need and what you want. When you see how much money you’re saving simply by limiting yourself to the necessities, you might be motivated to be conscious of what you’re spending your extra money on.

Pay particular attention to how much you spend on dining. The average American household wastes more than $3,000 per year on dining out. That’s a lot of money saved if you opt to eat at home instead.

Stay motivated

One of the biggest challenges, when you’re trying to save money, is staying motivated to do so. Keep these tips in mind:

  • Every dollar counts. Set smaller savings goals to make saving more manageable. As you see the dollars building up, you’ll be more motivated to increase the amounts you out away.
  • Be accountable. Tell your loved ones that you’re trying to save money. They’ll help support and motivate you but they’ll also hold you accountable when you go off track.
  • Get the right account. Don’t put your money in an account that you use regularly. Separate your savings from your spending money to reduce the chance you’ll spend it.

Saving money doesn’t have to be overwhelming. Be sure you set realistic and attainable goals and use the above tips to set yourself up for success.

The road to financial independence

If financial independence is your dream (just as it is mine), then embarking on a money saving challenge could be a good start. Whether you choose the 52-week, bi-weekly, 12-month, or piggy bank challenge, you’re taking a step in the right direction. If you’re not quite ready to take on a major money saving goal, you can start with the small stuff like limiting your spending. For me, it’s all about getting started with increasing your savings, so find something that works for you.

Your turn: Have you ever done a money saving challenge? Did it work for you?

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