The International Monetary Fund (IMF) projections show that the rate at which people save will gradually improve in the next six years.
In 2021, savings growth projection stood at 8.2 percent of the Gross Domestic Product (GDP). The growth is expected to improve even further in 2022, as the economy gradually recovers from the impacts of the global pandemic.
Well, are you planning to save more in 2022? The 52-Week Challenge is one way to keep your savings on track.
In this article, we will help you learn about this challenge and the tricks towards achieving it. But let’s first look at what the 52-week saving challenge is.
The 52-week savings challenge is a yearlong savings plan that involves saving and increasing the amount of money every week until the last week of the year. For instance, you can start by saving Ksh100 for the first week, Ksh200 in the second week, Ksh300 in the third week, and so on until you save Ksh5,200 in week 52.
If you challenge yourself to save in this manner, by the end of the year you will have saved a total of Ksh137,800.
Perhaps you are wondering when to start this yet we are in the third week of the year. Well, you do not have to worry. You can start this challenge at any time.
Most people tie savings challenges with new year resolutions – meaning they start saving in the first week of January.
But you can start this challenge whenever you are ready and the best time is at the beginning of a new week or a new month. This will give you a fresh start or a new beginning to your financial progress. You need to get into this challenge willingly and when you are ready to be committed.
Get a friend or partner to motivate you and keep the challenge on track.
You can take on this challenge based on two savings strategies. Depending on the strategy you take, ensure consistency.
This strategy involves saving from the lowest amount to the highest. As the weeks go by, you increase the amount you save. For example, you start at Ksh100 for the first week, Ksh200 in the second week, Ksh300 in the third week, and so on. You could begin at whatever point you are comfortable with in line with your savings goal.
The approach is good for someone cultivating the habit of saving or when you have limited funds and want to increase your income.
In this approach, you start saving from the highest amount you can possibly save in a week to the lowest. For instance, you can start by saving Ksh5200 in the first week, Ksh5100 in the second week, Ksh5000 in the third week until you save Ksh100 in week 52.
You probably have a new job, you have earned a bonus or commission in the first months of the year, this is the best strategy to ignite your savings challenge. This can help you to easily meet your target.
As you take on either of the approaches, ensure you align it with your goals. What you want to do with the money at the end of the year should be clearly defined and followed to the letter.
Once you have set your plans and you have kicked off the challenge, you need to ensure that you commit to it until you hit the target. Here are the tricks you can follow to ensure you follow the challenge to the end.
To take the 52-Week Savings Challenge, you need to set clearly defined goals. What do you want to do with the money at the end of the year? Are you saving to boost your emergency fund, future expenses, to pay debts, investment or do you just want a fancy vacation? The goal will lead your commitment towards achieving it.
While planning for your monthly budget, it is a wise decision to build in a savings budget. Your weekly savings challenge will definitely fit in. Depending on your mode of payment, you can budget this saving plan into weekly, bi-monthly or monthly.
After you have included your plan into your monthly budget, you should cut out unnecessary expenses to create additional funds that can supplement the savings. Think of the bills you are paying for yet they are inessential, like going for dinner out, commuting to work when you can work from home and save on your bus fare.
Employer benefits come in the form of gifts, salary increments, bonuses, or commissions and so on. These benefits can be essential to boosting your weekly savings challenge. You can use your bonus or commission to pay for more weeks ahead. This will enable you to evade challenges resulting in emergencies that might slash your savings amount.
The 52-Week Savings Challenge is open to shortcomings as well. Most people do not have enough cash to be pushing in their savings every week. To deal with this shortcoming, you can divide the amount into monthly or bi-monthly savings.
That is, by the end of week four, you save Ksh1000 or Ksh500 on date 15 and the remaining balance until the end of the month.
To avoid dipping your hands into the savings–financial discipline, open a lock savings account. This will prevent you from impulse spending that might push you to dip your hands to the savings.
For compliance and consistency in savings, set an automatic deduction from your bank account to the savings account. This will cut on bad money habits that might push you to spend more at the expense of saving.
The 52-Week Savings Challenge is significant to our financial growth and development. As you take on the challenge, expect to enjoy the following benefits;
We always have plans to save but most of us struggle to get started and maintain these plans. However, the 52-Week Savings Challenge has proved to provide a clear direction to start and achieve our financial goals.
The challenge is a road map to financial freedom. It gives you peace of mind and defines your financial status. You can use it to build on the best money habits that can lead to your financial success.
What keeps the challenge on track is commitment, consistency, and financial discipline which you can build along the way as you kick it off.