The 30-day money saving challenge is a great way to save nearly $500 extra dollars in a single month. It asks you to save a different amount each day of the month, anywhere from $1 to $30.
The choice is yours how much you save each day, as long as you hit your daily savings goal. You can use paper envelopes and cash to complete the challenge, or you can apply the concept as you transfer money into a savings account online.
Either way, following the challenge will help you curb spending and build your savings fund in just one month.
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How Does the 30-Day Savings Challenge Work?
Ready to take on the 30-day savings challenge? Here’s how it works.
Start by purchasing 30 envelopes and numbering them 1 through 30. Every day, choose an envelope and put in the amount of cash that the number on the envelope indicates.
If the envelope says 3, you’ll put in $3. If the envelope says 27, then you’ll put in $27. You don’t have to go in order from 1 to 30, but rather can choose whichever envelope you want to fill each day. It may be easier to fill in the higher-numbered envelopes closer to pay day, for instance, while you might opt for a low-numbered envelope when your budget is tighter.
As mentioned, you don’t have to use envelopes and cash if you prefer to save online. Instead, you could follow the same challenge and transfer a certain amount of dollars into your savings account each day.
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How Much Will You Save?
If you follow the 30-day savings challenges for all 30 days, you’ll have saved $465 at the end of the month. That’s a big chunk of money that you can store in your emergency fund or put toward a home improvement project.
If you’re struggling to keep up with the challenge, you can amend the 30-day savings challenge. For instance, you could number two sets of envelopes 1 through 15, so the most you have to save per day is $15.
With this approach, you’d save $120 every 15 days, or $240 at the end of the month. While your savings will be lower, that’s still a significant amount of money to add to your rainy day fund.
Choose an approach that works with your budget so you can stay on track throughout all 30 days of the money-saving challenge.
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How Will You Save Money?
To complete this 30-day money saving challenge successfully, you may need to find ways to cut your spending or increase your income. Here are a few strategies that could help.
Create a budget
Before you can identify areas for savings, you need to take a close look at your income and expenses. Creating a budget will give you a bird’s-eye view of where your money is coming and going each month.
Take some time to write down your income and recurring expenses, including major expense categories like rent or mortgage, utilities, car payments, and groceries. Make sure to account for discretionary expenses, too, like shopping and eating at restaurants.
By making a budget, you can spot areas where you can cut back on spending and boost your savings, instead. You could use a simple spreadsheet or a budget-tracking app.
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Meal plan
If you tend to go out to eat or order takeout frequently, you might be able to save money by cooking at home instead. Taking some time to plan out meals for the week and shopping with a list can help you reduce your food spending and avoid impulse purchases.
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Cancel subscriptions
Take a look at your bank account and credit card statements to see if you’re paying for any recurring subscriptions you forgot about or no longer need. You might be surprised to find you’re still being charged for services you don’t use anymore. If you’re paying for an expensive gym membership or streaming service, you could also consider switching to a less expensive or free alternative.
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Sell used clothes
While reducing your spending can help you save money, it’s only one side of the coin. On the other side, you can also find ways to boost your income. One option to consider is selling your used clothes and other items online. Online consignment stores make it easy to list your pre-owned wardrobe and connect with customers. Plus, you’ll clear out your closets and get rid of items you no longer wear.
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Start a side hustle
Along similar lines, search for side hustles that would earn you some extra income you could put toward savings. You might drive for a ride-sharing service, grocery shop for a service like Instacart, offer services through an app like TaskRabbit, or find freelance gigs on a marketplace like Fiverr or Upwork. There are many options out there for flexible side hustles that could boost your income and help you meet your savings goals.
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Why Having Savings Is Important
One of the best ways to take control of your finances is to build out your savings. While it’s a tall order, most experts recommend building an emergency fund that could cover between three and six months’ worth of expenses.
That way, you’ll have savings to fall back on in the event you lose your job or are unable to work for a period of time. Plus, you’ll have a rainy day fund to draw on when emergencies happen and you need to cover a car repair, medical bill, or other unexpected expense.
Without savings, you might have to take out an emergency loan to cover unexpected expenses. Borrowing money is always more expensive than using savings, since you’ll have to pay back the amount you take out plus interest and fees.
Having savings is also important for meeting other goals, whether you want to plan a wedding, buy a home, or take a vacation. Building a nest egg can also help you retire comfortably when you’re ready.
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Where to Keep Your Savings
One of the best places to keep your savings is in a high-yield savings account. While the national savings average is only 0.42%, some high-yield accounts have rates of 5% APY or higher (as of August 2023).
By opening a high-yield savings account, your savings can earn interest over time. If you also hold a checking account at the same institution, you could set up automatic transfers into your savings account.
Automating your savings can help you hit your savings goals without much extra effort on your part. Just make sure you have enough in your checking account to cover your bills and avoid overdraft charges.
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The Takeaway
Saving money can be difficult, but setting specific, time-bound goals makes it easier. That’s why the 30-day savings challenge can be so effective.
It tells you exactly what steps you need to take over the course of the month to save a total of $465. You can start the challenge at any time and use the approach that works for you, whether that’s paper envelopes or daily transfers to your savings account.
This article originally appeared on SoFi.com and was syndicated by MediaFeed.org.
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