Back in 2014 (I can’t believe I can actually write “back”) we took part in and hosted a 52 week savings challenge. We, along with those who took part, were able to add over $1,400 to our savings account by following this simple plan. We skipped the plan last year, but have decided to bring it back for 2016, and we want you to be a part of it!
Last year we got hit with car repairs, medical bills, and the purchase of a new car, and all of these things decimated our savings (and even added to our debt in some cases). Because of that, it is one of our top priorities to build up our savings once again.
The 52 Week Savings Challenge
Of course, there are a lot of methods that you can use to save money, but we found the 52-week savings challenge to be both easy and accessible to us and all who participated in this with us. So what exactly is the 52-week savings challenge?
How Does This Work?
The picture above shows the timing and the effect of the weekly savings challenge. As you can see, it calls for you to place a small amount in savings each week of the year.
How do you decide how much to put the savings? Well, it’s based on what week we are in…
For instance, at the end of the first week of the year you put aside one dollar for savings, $2 for the second week, $3 in the third, and on and on it goes. The final week (week 52) will call for you to place $52 into your savings account. If you are consistent with this plan throughout the year, on December 31st, you should have $1,378 in your savings account.
My suggestion is that you open a new Checking or Savings account with Capital One 360 (Full Disclosure: this link contains my referral code). We currently have about 12 accounts with Capital One between personal and business and we couldn’t be happier with their products or service. You can set up automatic transfers from your current bank, and if you use the link above, you will earn a $25 bonus just for signing up!! It’s free money!!!
So if you decide to open a new Capital One 360 checking account using this link, then you will have a total of $1,403 at the end of the year! By choosing an online bank, it will help you to fight the temptation to dip into your savings account for a frivolous purchase.
We all know that starting a habit is usually the most difficult part. So the great thing about this plan is that during the first month or two – while you are trying to establish the habit of saving – you’re only putting aside a couple of dollars each week. It isn’t until week number 10 that you actually put aside double digits into your savings account ($10)!
By that time you have already been saving money each week for 2 1/2 months, and it will most likely be a strong habit that won’t be easy to break. So while it may not be easy for you to put aside $50 right away, you are able to very slowly build up to that by starting with one dollar.
We’ve created a PDF of this document so you can download and print it out and put it anywhere that will motivate you to continue saving. We also plan to document our progress on the site so that you can join us in doing this together.
52 Week Savings Challenge: Alternative Methods
52 Week Savings Challenge in Reverse
As some people commented when we first ran this challenge, coming up with the larger weekly amounts (you end up saving over $200 in December alone) as we get closer to Christmas may prove to be difficult. Because of that, we have also created a printout for the reverse schedule, that you can download here.
With this method, you begin the year saving $52 and then save $51 the following week. This way, when you get close to Christmas, you are saving tiny amounts (you save $10 total in December). You still end up with the same amount in your savings account, but you get the tough weeks out of the way at the beginning of the year.
Start Slow and Then Go Into Reverse
Most likely, this is what we are going to do for the challenge. With this method you start off with the normal schedule and once you can afford to start making larger transfers, switch over to the reverse method. The benefit of this is that you can start off slow and once you gain momentum and saving money becomes an ingrained habit, you can ramp up the transfers.
This also has the benefit of allowing you to avoid the huge contributions happening alongside Christmas.
I suggest downloading or printing out both schedules and marking them off as you go in order to ensure you don’t miss a transfer (duplicating one isn’t as big of a deal).
Take the Big Weeks at Random
This method is similar to the one describe above, and it is the one that we will do if we don’t use that one. Instead of starting slow and switching to the reverse schedule, you simply use the original method and then mix in some of the larger payments as you are able.
For instance, if we have a particularly prosperous April, we may take care of the later contributions (counting down from week 52) instead of (or along with) the ones normally due in April. Again, this will allow you to have flexibility in your saving, while still sticking with the intention of the original challenge.
For this latter method, I suggest downloading the original schedule and marking off each transfer that you make.
It is our hope that at the end of the year we all have at least $1,378 more in savings than we do today by doing this 52 week savings challenge! This number can be over $1,400 if you open a new Checking or Savings account with Capital One 360 using our link.
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