Spring is fast approaching, and it’s about that time for new habits, bigger goals, and refreshed motivation. Today, your new goal is to save $500 in a week, and it’s really going to change the way you look at budgeting and saving money. Are you up for the challenge? Of course you are!
Own it and Commit
The first step to building up a successful savings account is to realize that you need one and why you need one. Sure, it’s easy to say, “Oh, I’ll just put some money away, just in case.” However, if you don’t attach reasoning to your actions, it will be much harder to stay committed them. You don’t want to be able to justify moving money out of your savings account, unless it is for the reason you put that money in there to begin with.
I can tell you how to save $500 in a week, but if you can’t tell me why you want to save this money and how it’ll help you later, you will struggle meeting this goal as well as any other savings goals. Make it mean something.
Here’s what you need to do: Start with your goals. What is it that you want this money to go towards? A down payment on a house? A car? Maybe you want to take a trip next year with your family? Maybe you need a year’s worth of income saved up just in case of an emergency (always a good idea). Whatever it is you want to use this money for in the future, write it down, and commit to it.
Track Your Money Flow
We are all about tracking here, because that is one of the best ways to achieve your goals – have it in front of you as a reminder. For the next 7 days, you will write down these items every single day:
- Earnings (hours worked x wages)
- Current amount in savings
- Amount you’re putting into savings that day
- Expenses (how much, what it was for)
- Balances for Cash, Savings, and Expenses
At the end of the 7 days, you’ll have a full week’s worth of data that you can use to adjust your spending habits to maximize your savings potential. Now, you know what you’re spending your money on, and you are able to identify where your financial waste is.
When you sign up for this challenge, I provide a Free 7 Day Tracker to help you keep track of your progress.
Find Weak Spots
To do this, you’ll need to take a look at your budget, and write down every single expense you had last month. Also, take a look at your bank statements to make sure your numbers match up. Usually, this is where people find the disconnect – they forget to account for small deductions as well as auto-pay amounts. You don’t want to set it and forget it. At least, not here.
After you have everything set out in front of you, determine what expenses can be cut out.
- Do you really need that Spotify account?
- Can you switch to drinking homemade coffee, tea, or smoothies?
- Can you lower rates on credit accounts?
- Do you need to eat out during the week, or can you commit to meal prepping at home?
- Will buying in bulk lower grocery bills?
- If you drive more efficiently or carpool, will it cut down your gas expense?
- Energy efficiency can lower your utility bills – can you wash clothes in cold water and only use lights, heating, and cooling when absolutely necessary?
Get creative when cutting out extra expenses. When you cut out all the unnecessary expenses, you can move those funds over into your savings budget. Score!
Substitute Your Sacrifices
If you cut something out, be sure to replace it with something else. Some free activities include:
- Reading books
- Working out
- Going out for a stroll/run/walk in the park
- Turn it into a picnic and bring a friend or friends
- Have a big clear out, and sell things you don’t need (cha-ching!)
- Take up a new (free) hobby
- Start a side hustle (no cost start-up)
When you feel like there’s something missing, you generally want to replace it with something that can end up being costly. Be sure to plan ahead and expect this to happen. You need to be prepared to feel like you’re missing out, but really, you’re not. You’re just living differently now, and your bank account is probably looking nicer than the person’s who isn’t.
If I learned anything about living in a really expensive place (Orange County), it’s that most people’s wealth is only a facade. Meaning, people go into debt to look like they’re wealthy in order to keep up with their neighbors, friends, coworkers, etc.
Don’t be like them. Who care’s what it looks like. What matters is how it really is. Don’t lose focus on your goals. You can do it!
Set Your Eyes on the Prize
You’ve gotten this far, and that’s a huge step. This means you’re ready to take on the challenge, and ready to invest in yourself and your future.
Whatever your goals may be, don’t lose track of them. Write them down and put them somewhere you can see them. Let them remind you what you’re after, and after hard work and determination, you will reach those goals.
It’s time to take on the 7-Day Savings Challenge, and I know you’re ready. How does it work? Sign up with the form below, and you’ll get an email from me as well as a little worksheet to help you along the way.