If you had some extra cash for a whole year, what would you do?
Would you go on a spending spree, repay debt, create an emergency fund, save the cash for a trip, retirement or simply bolster your savings?
Good financial health is when one is able to spend less and save more money regardless of your personal or family circumstances. How would you go about saving your money, then?
While we will not all be lucky to experience a financial windfall, we will need to save what we earn.
A fun and effective way to promote the formation of saving habits and provide the accountability and motivation to uphold them is through a money-saving challenge.
You can take on a variety of financial challenges, some of which we have discussed in this post.
Consider the available choices to determine which one could work best for you and your financial objectives.
But before we get into the juicy part;
A money saving challenge is a contest that lasts for a year or a specific number of months, and is meant to help you save money in the course of the year that the challenge runs. A saving challenge can last any amount of time depending on targets and goals of those participating.
There are several challenges through the year and depending on the one you choose, you can run it as many times as you want. You can join a challenge at any time of the year.
You can track your progress throughout the challenge following the rules set for the saving task.
Read Also: 6 Saving Tips For Low-Income Earners
A challenge to save money puts you in charge and lets you save however much or little you choose. To monitor your progress, you can define your own objectives and progress.
The best money saving challenges to try this year:
For those looking to grow their savings over one year, the 52-Week Money Challenge is a popular one.
Those who participate in the weekly money-saving challenge have the chance to save a certain amount of money at the end of the year by adding an agreed amount to their daily savings. The concept is straightforward: if you save whatever amount every week, you will easily have more money saved up after 52 weeks.
The 52-week money-saving challenge has options to save different amounts throughout that time.
In the 52-week savings challenge, you might begin by setting aside Ksh100 in the first week, Ksh200 the following week, Ksh300 in the third week and so on until you can save Ksh 5,200 by week 52.
By the end of the year, if you challenge yourself to save in this way, you will have amassed Ksh137,800 in savings. Even though this challenge starts out simple, it gradually gets harder since the amount to save keeps increasing. The initial weeks are straightforward because everybody can save a small amount each week. You'll undoubtedly improve your ability to do so as time goes on, and you'll probably discover a few new ways to do so each week or each month.
Pro Tip: To hack this, start with the amount you’re able to contribute every week. If it’s Ksh100, start with that. Don’t start with a higher amount if you cannot manage to sustain it. Start small and then grow the amounts as you get accustomed to the challenge.
This task could sound easy but it may not be for some. The challenge is about not spending any money for the chosen period of time which could be a weekend, a week, or a month.
This challenge entails no expenditure beyond needs like food, rent and transportation to and from work or school. How much money this can save you will amaze you.
In this challenge, you could consider avoiding:
The no-spend saving challenge could be one of the easiest and most efficient ways to cut costs. To make it interesting, you can invite your friends or family to participate where you seek cost-free activities.
Pro Tip: Challenge yourself not to spend for a certain period of time and then put that into savings. See how well you pull this off and then consider extending the time that you do not spend except on essentials only.
Read Also: Why You Struggle To Save – Money Psychology
Another choice to save is by keeping all of your extra cash and change. If you pay with cash and have change, you can put that in a piggy bank or jar and watch as the money accumulates.
The growth of your savings in this challenge is dependent on how frequently you make cash purchases. Thus, your money may accumulate fast or gradually.
Another way you can do this is by rounding up your purchases. For instance, if you purchase something and the difference to a complete figure is your change, you round it off to nearest figure and save up the difference.
For example, if you pay Ksh175 for a drink, you could save the Ksh25. By doing this, you have rounded off the cost of your drink to Ksh200 but you save the difference.
Pro Tip: Some of us tend to treat change as money that should have been spent. However, consider building a habit of saving by not only saving the change but rounding it off to a complete figure. Instead of saving Ksh25 as indicated here, try make it Ksh30 and see how much you can save in a certain set period.
Read Also: 10 Reasons to Start Saving Now
Fancy a vacation?
Well, this holiday helper challenge is a variation of the 52-week challenge themed around the holidays. You put aside a certain amount every week from the beginning of January through December. The savings could help you with gift-giving for family and friends or just taking a break for yourself.
Pro Tip: If one year seems like too long of a challenge for you, you can begin setting aside some money each week in July or a few months to when the holiday should be. Challenge yourself to set aside some money towards that holiday kitty and see hwo well you do when the due time comes.
Whenever you have a disposable Ksh100, put it in an envelope and put it away. Add it all up at the end of the year and see how much you have managed to save. This is a simple challenge which is also flexible but it sets you on your path to building a saving habit.
Again, you can try to save the Ksh100 daily and have this for whatever duration. It could be a month, 5 months or a year. In a month you will have saved Ksh3,000 and over Ksh30,ooo in a year.
Pro Tip: For you not top be disappointed and give up midway, consider following the most efficient way for you towards your saving goals. Start saving with amounts you are comfortable with and then increase this as time goes by and as you get more used to saving more.
Have you thought about adopting minimalist practices to improve your financial situation?
If you're unsure if you can fully adopt the minimalist lifestyle, then take on a money minimalism challenge while living a minimalist lifestyle for a week or a month.
Living simply and limiting your expenditures to only what you absolutely need or love may be the key to overcoming the difficulty. Try to look at it from the perspective of avoiding buying anything without sacrificing your standard of living rather than what you can afford.
That can entail cutting out outings that cost you or choosing to visit places and engaging in activities that do not cost you.
Pro Tip: Consider cutting out spending on what is not essential and strive to live minimally as possible. See how this lifestyle helps you save and then work towards a life that cuts out what is not absolute necessity and put the money in a kitty that helps you save.
Read Also: 7 Reasons Why You Should Start Saving Now
Every so often we do with our money what we regret as financial mistakes. Since money mistakes occur, what if for every mistake you made you saved a certain amount of money? This could be for each time you overspend, buy something on impulse or generally “made it rain” just because you had cash…
If you made a commitment to yourself not to eat out this week and you do, you put a certain amount in the jar or if you made impulsive online purchases.
Pro Tip: Consider gamifying your errors which could assist you in reinforcing good financial practises and helping you develop long-term financial habits.
Set a goal for yourself to save, say, 5%, 10%, or 15%, of your monthly income.
Whatever you can actually afford without having to borrow from it or straining your finances. This may be a fantastic strategy to save without much thought. Consider setting up an automated transfer to your savings account each payday, and watch the money accumulate.
Pro Tip: Aim to set aside any amount from your monthly income towards saving. This could help put you on a saving path if you are not already accustomed to saving.
Read Also: 9 Money Rules You Should Live By
If you do not already keep track of your income and expenses with a monthly spending budget, then you may consider starting. This will help you do your best to estimate your expenses and have some cash on hand at the end of the month.
If you succeed in doing this and have extra cash at the end of the month, put it into your savings account and watch as your money grows.
Pro Tip: Instead of spending what you have left at the end of the month after you have done your shopping, consider putting the money into a kitty. The money saved this way should be easy since it is after you have already spent on what is budgeted. Challenge yourself and see how much you will have saved in 3, 6 or 12 months
We know pay raises are hard to come by but what if your employer gives you bonuses or monthly rewards for meeting targets?
If you’re this lucky, then challenge yourself to set aside some of any raises you get. You can pretend you didn't earn the raise if you were already getting by on your prior salary. If possible, you may save all of your increase and carry on with your current way of life.
Alternatively, if you have to spend that raise, check if you can save some of it instead, perhaps 10% or 25%. By doing this, you can increase your savings without reducing your present consumption.
In addition, if you happen on a windfall, though rare, you could avoid spending it and instead put it in your savings account. Without having to deduct any money from your regular salary or make any sacrifices, this might be a fantastic method to increase your savings.
Pro Tip: If you are getting by well enough on your current salary, you could consider saving the raise for a set time. This could be 6 months or a year or however long you can comfortably maintain the momentum. This is one of the best ways you can consider putting your salary raise into good use for a future time.
Create a secure future to achieve your financial goals by saving money since it is crucial. You may develop new habits and tactics to help you save more and spend less by attempting these money-saving challenges in 2023.
These challenges can help you in reaching your goals, whether you're looking to pay off debt, save for a significant purchase, or simply increase your emergency fund. Why don't you try them out and see how much money you can save this year?
If possible, before acting on any financial advice here, you can get the opinion of a financial adviser. An expert would probably give you deeper insights and guidance on these challenges and give you a perspective that would make your goals a success.
Enjoy your saving journey!