A little over a year ago, I read about this amazing savings challenge where a blog writer described how they didn’t have to worry about using money from their checking account for Christmas gifts because they had an extra $1,400 in savings that they could use for the holidays. Now for the PFG family, savings has always been a part of our finances but we are always looking for new, innovative ways to save in a meaningful way.
Over the years we have heard of different ways to save and even tried some.
Cut out the coffee
There is this idea that you can cut out one cup of Starbucks coffee and put away the money you would have spent on the coffee into your savings account. The biggest problem with this for the PFG family is that we don’t drink coffee. With this in mind we could cut out soda… another thing not in the PFG family. For us, the concept of this savings plan is great but unrealistic with our way of living.
Debit card rollover
For the last few years, banks have attempted to promote “rollover savings” where every time you use your debit card on purchases, the extra change to equal the nearest dollar is rolled into your savings account. The PFG family tried this for a year but we found too many problems with this savings method.
First of all, this removed the control we had over the amount of money going into our savings account. There were times where we wouldn’t want all of our purchases to rollover but these systems are an all or nothing system. Secondly, we changed the way that we used our debit card (we will write more about this later) and the amount of times we were using our debit card was minimal. At the end of some months we had only saved $5. After a full year, we removed this service from our checking account.
Putting a percentage of our paychecks away each month
In 2012, we attempted a new savings plan where we would take a percentage of each of our paychecks and put this amount away into our savings account. While initially this savings plan gave us large returns, we soon found that job changes and larger expenses forced us to transfer the savings right back into our checking account. As we continue to pay off our debt and solidify our jobs, this might be a savings plan we go back to at some point.
And the 52 Week Savings Challenge
So after reading the blog post about the extra $1,400 in savings, we decided that we would try out the 52 Week Savings Challenge in 2013. The challenge is to put a dollar away the first week, two dollars the second, three dollars the third, and so on until you are putting 52 dollars away in the last week of the year for a total of $1,378 for the whole year. (See chart above for a breakdown of the total dollars saved.)
There are many different ways that people complete this challenge. Some set aside a jar with a checklist and mark off each week they put in their savings. Others set up an account and manually make the transfer each week. And others including ourselves, set up an automatic withdrawal for the amount each week.
Initially, we didn’t have a goal for what we would save this money for but two months in, we decided it would be used for our kids’ savings accounts. (Check out next weeks Financial Friday about saving for our kids). The 52 Week Savings Challenge has allowed us to have an account where we can take this money from rather than it coming directly from our checking account.
As our kids grow older, we will begin to alter the savings challenge for them so they can participate also. Maybe our son will put away a penny away each week and then a nickel and then a dime until he reaches a dollar. For our own 52 Week Savings Challenge, we are not going to make any changes in 2014 but maybe in 2015, we will tackle the challenge by putting aside two dollars each week.
What would you use your extra $1,378 in savings for? Do you have a different way that you save money? Join us in the 52 Week Savings Challenge for 2014 and share your experience.