As the COVID-19 pandemic has shown us, life can be unpredictable. One day you’re going to work, meeting your friends and extended family, planning trips and dining at restaurants. The next week, everything is under lockdown and prohibited. The pandemic also gave rise to many surprise expenses. Some people even had to take pay cuts or lost their jobs. Many businesses suffered unexpected losses. We’ve all learned just how important it is to save and set aside emergency funds. Savings aren’t only for a rainy day. They can also help you achieve a goal like buying your dream home, travelling the world, or getting the latest tech gadget.
Building your savings allows you to be financially independent. With the right savings account, your savings can even earn interest tax-free. However, many people find saving really hard. They just can’t seem to put aside money periodically. Either they aren’t sure how to begin to save, or simply end up spending every dollar that comes their way.
Whether you’re just starting to save, want to build an emergency fund, or want to develop a savings habit, all you need is time, planning, and just a little discipline. It also helps when you’ve got a fun and effective way to start saving like the 52-Week Money Saving Challenge.
What is the 52-Week Money Saving Challenge? How do I do it?
The 52-Week Money Saving Challenge is designed to help you increase your savings bit by bit each week. At the end of the 52 weeks, you end up with a large lump sum amount. Every week, you add another dollar to the amount you save, starting at $1 the first week and ending at $52 by the 52nd week. So, you’ll begin by saving $1 the first week, $2 the second week, $3 the third week, and so on…until week 52, where you’ll save $52. Using this method, you will have saved almost $1,400 by the end of the one-year time period!
Why 52 Weeks?
Each year has 52 weeks. This challenge helps you build a savings habit over the course of a full year. But that does not mean you have to start the challenge only in a new year. While many people do start the 52-Week Money Saving Challenge in the first week of January, and end in the last week of December, you can start it at any time. Just make sure to keep increasing the amount you save by $1 every week.
Does the 52-Week Money Saving Challenge actually work?
Lots of people have been able to build a savings habit and increase their savings using the 52-week method. So, there’s plenty of evidence that it works. Like everything, it has its pros and cons. Let’s take a look at what these are:
It’s easy to start
The most difficult part of building any new habit is starting. Since the 52-Week Money Challenge begins with such a small amount ($1), it’s easy to start. If someone had asked you to save $1,400 in one go, that might be hard. But $1? You can easily spare that amount. By making it so easy to begin saving, the challenge removes the biggest obstacle in your way. Also, once you start, it’s easy to keep going, too – which brings us to the next point.
It’s easy to sustain
Once you’ve started to save, you’re more likely to keep going. Besides, adding only $1 per week makes it easy to keep saving. An additional $1 seems like a very small amount to add. So, even though the total amount keeps increasing every week, you only perceive the $1 difference, which seems like very little. The small incremental increase in the amount makes it easy to continue the challenge.
Keeping it simple is always the best way to start and build a habit. When things get complicated, it’s easy to get confused and discouraged. Take something universal, like learning to read. Imagine going to kindergarten and being asked to read Shakespeare! That wouldn’t work. We’re first taught the alphabet, then small words, then bigger words, and finally sentences. In the same way, the 52-Week Money Saving Challenge makes it simple to save. Just add $1 per week. That’s all you need to think about. Add another dollar, keep on saving, keep on winning at the challenge.
The 52-Week Money Saving Challenge is downright fun. Humans are naturally competitive and like playing games. Challenges such as these, where you have a weekly goal to achieve, keeps you motivated and engaged. It’s pretty much like a video game. When you complete one level, you move on to the next. The final prize? Your total savings amount, and that feeling of pride and satisfaction.
Since you’re only putting away a small amount every week, the 52-Week Money Saving Challenge is practical. If a large chunk of your paycheque goes straight into your savings, that may not leave enough for the rest of your expenses. With a small amount to save each week, you can still buy the things you need and pay back your debt while achieving your savings goals too. The gradual increase in the amount also gives you a chance to get used to saving every week.
As you can see, using the 52-Week Money Saving Challenge method to start saving has plenty of advantages. Plus, your savings can also get you tax benefits! However, there are a couple of downsides too. (Don’t worry though, we’ve got ways to deal with those cons.)
Cons that you can resolve
The end may be difficult – so do the challenge in reverse
Starting the challenge is easy thanks to the smaller amounts. But, as you progress, it may seem more difficult to set aside the larger amounts. Especially, if you started the challenge in January, you’ll have to put aside upwards of $50 each week in December. With that being the holiday season, it may seem hard to save. The solution? Do the challenge in reverse. Start with $52 and reduce $1 every week. By the end of your 52 weeks, you’ll only be putting aside $1 and end up with the same amount of almost $1,400 in savings.
You may forget to save each week – set a reminder or schedule automatic transfers
When you’re just starting a new habit, it’s still not part of your routine. It’s likely you may forget to set aside money each week. So, you need to take special care to ensure you achieve your weekly savings goal. Set a reminder you can’t miss – like an alarm on your phone, or a date circled in red on your wall calendar. An even easier way to make sure you don’t miss a single week, is set up scheduled transfers in online banking or your mobile app. The money can go straight from your chequing account to your savings account, without you even having to remember.
You may lack the self-discipline – so get a friend to save with you
As fun, easy, simple, and practical as the 52-Week Money Saving Challenge is, it may be difficult for you to force yourself to set aside money each week. Some people just need a little external motivation. Getting an accountability partner like a friend or family member will go a long way in making the challenge easy to complete. You can check in with each other every week and help keep each other on track. Plus, you’ll be helping them save too. Win-win!
You may feel like quitting if you miss a week (or a few) – just keep going anyway
Remember, a pause is no reason to stop. If you miss a week or two, or even a whole month, don’t fret. Just keep going. Continue with the challenge and save as if there was no break. Add $1 to the last amount you set aside and take it from there. Sure, your 52-Week Challenge may end up being a 57-Week Challenge instead. But, like we said, life can be unpredictable. Be kind to yourself. You’ve already made a great decision to start saving, so keep it up.
You may feel tempted to spend your savings before the challenge ends – so don’t save in cash
Out of sight is out of mind. When it comes to cash, seeing it often leads to spending. The easy access makes it difficult to resist. So, make it difficult to spend. Deposit your savings in a bank account. And keep it separate from your regular chequing account funds so it doesn’t accidentally get spent on groceries or a chai tea latte.
Here are some extra ways to make the 52-Week Money Saving Challenge a breeze for you.
Add it to your budget
If you don’t already make budgets for your week, month, or year, it’s a good idea to start. And, while you’re making your budget, add the amount you’ll save each week to it too. Planning to save means you’ll always be able to meet your weekly savings goal. You may also be able to get some additional tax benefits on your savings amount. Plus, if you budget properly, you will also be able to spend wisely and get perks such as different credit card benefits for using your card for purchases. Doing your homework and making a budget allows you to save without the stress and even find ways to earn more.
Cut back on different expenses every week or month
One of the ways to increase your savings is to cut back on unnecessary expenses. Maybe it’s a subscription you don’t really use, or way too many coffees, or even charges you’re paying without realising. Did you know, you may be paying as much as $30 per month to your bank? You could just switch to a no-fee bank account instead. To that point, you can start cutting out different expenses every week or month and put that money towards your challenge savings goal instead. Start with the small things and build up, just like your savings. This way, it won’t seem too overwhelming to cut down everything you spend at once. You can keep adding to your list and check which expenses you can do without (and those you really don’t want to give up!) as well.
Couple the challenge with another good habit
This goes beyond simply cutting expenses. The 52-Week Saving Challenge can be a great motivation to cut down on bad habits and put the money you’d spend on them into your savings. For example, perhaps you want to start eating healthier or quit smoking. You can skip takeout and cook healthy meals at home for a week. Or buy less cigarettes. Having a savings goal will give you a concrete reason to save a certain amount of money. Again, start small and build up. By the end, you’ll have built a savings habit and improved your health too!
Ready to start your own 52-Week Money Saving Challenge journey? We can help. Open a savings account in minutes to help you meet your challenge goals today.