There’s this thing that has been floating around the internet for several years, something along the lines of “The 52 Week Money Challenge”.
The idea is that in week 1 you save one dollar, week two you save two dollars, week three you save three dollars et cetera et cetera until the end of the year when you are saving a whopping $52 per week.
You have a magical Disney World vacation fund all ready to go.
Sounds like a great idea.
How many of you would be financially capable of saving $52 a week without increasing your income or adapting to a different standard of living?
Saving money as a habit is important, but you also have to learn how to have that extra money in the first place.
It all comes down to two things: making more money and spending less.
My goal in 2016 is to save $10k. Weekly that’s about $192.
Whew! Here’s how:
I’ll break my strategy down into three categories: making more, spending less, and saving skills.
Making More Money by…
For the majority of last year I worked part time in my career job and part time as a subcontractor. For 2016 I plan on working close to 40 hours per week, and do additional contract work up to 15 hours a week.
If you do not have specific career skills that you feel you can charge for, here are a few ideas of odd-jobs you can do to make extra cash:
- Work security at events (some companies do not require any experience at all)
- Babysit, dog sit, or house sit
- Do yard work for neighbors (seriously, I would pay a friend $15 to mow my lawn)
- Work temporary weekend gigs like fair booths
I currently charge clients 5x what I was charging a year ago, and my rates are going up again. The biggest thing I have struggled to learn as a freelancer is my own value.
I have a valuable skillset that people are looking for. I have never had to seek out clients and sell my services.
If you work for yourself and you have a heavy workload and aren’t making as much as you think you deserve, inform your clients that you will be increasing your rates or pitch a higher rate to your next client.
There is risk in upping your rates – you may lose a client or you may lose a prospect if you are asking for an unreasonable amount. If you’re like me you’ve been undercharging all along, and they will gladly agree to your new rate.
Spending Less Money by…
I am the queen of go big or go home. Moderation is barely in my vocabulary.
I love to lift heavy weights as many days a week as my body will allow. I love to work 12 hour days and 7 day weeks.
I love to drink coffee out (in fact, I’m in a coffee shop now). I love to eat out at restaurants. I love to buy trendy dog print clothing that I will never ever wear.
Here are a few things I plan on moderating to save some money:
- Only go to coffee shops 3x per week
- Only buy coffee at work 2x per week (I can brew coffee at the office, I don’t need to pay to buy it at the cafe)
- Only buy lunch/snacks at work one day per week
- Only eat in a restaurant one day per week
- Switch from a 3 gig data plan to a 1 gig data plan and use wifi more
…Thinking More About Large Purchases
When I want to make a big purchase, I usually want to do it NOW.
If I decide I want a new computer, I make the purchase within 5 hours. If I decide I want a new phone, I make the purchase within 5 hours. If I have an idea for a new tattoo, I book the next available appointment.
My goal is to have a two-week buffer period from the time I decide until the time I purchase. That way I’m really certain that the big purchase is much needed, and I’m really certain that I’ve found the best product and price.
Saving Money by…
…Putting Money Where I Can’t See It
My bank account is set so that with every debit purchase I make, a dollar is trasferred from my checking account to my savings account. Then, in a few weeks’ time I have accumulated multiple dollars of savings.
Like the 52 Week Money Challenge, it’s great in theory.
Except I do all of my banking online, and when I look at my checking account balance, I look at my savings account balance. And usually I transfer all of those saved dollars back to where I can spend it.
This year I plan on putting more money where I can’t see it – or at least where I won’t regularly see it.
This week I set up my retirement contributions to the maximum that my company matches so that every paycheck a portion of my income is tucked away to where I will only see it when I get a quarterly report.
I also downloaded an app called Acorns, which is linked to my bank account. With every debit purchase that I make, Acorns rounds up the price to the nearest dollar and tucks away the change in an investment account.
Will I actually save $10,000 in 2016? Who knows. But I will work hard to save as much money as possible.