Six savings challenges to start NOW with just 1p – and you could save £5,050 by next Christmas
GETTING on top of your money and beginning a new savings habit is always a popular New Year’s resolution.
But for many of us, it is difficult to know where to start.
A savings challenge can help you get into the routine of putting money aside each week or month.
The idea is to make saving money manageable.
Greg Davies, a behavioural finance expert, said challenges are a great way to make saving less daunting.
He said: “Turning savings into a game taps into our natural desire for achievement, making it easier to stay committed and motivated over time.”
There are many savings trends you could take part in that could leave you with hundreds if not thousands of pounds by next year.
Plus there are many options for each budget, so do not worry if you can only put away pennies every time.
Different schemes will work for different savers depending on their income and what they are saving for.
Here we explain how six popular savings challenges work and how you can get involved.
No spend days
In this challenge, you are not allowed to spend money on non-essential items on certain days of the week.
This means that all luxury purchases such as coffee, makeup or alcohol are banned.
The idea is to learn where you waste money and how you can cut down on your spending in these areas in the future.
Put any money you do not spend into a savings account, which you can use for a holiday or rainy day fund.
To get started, make a list of which weekdays will be a no-spend day.
Next make another list of items that you think are luxuries, which you are not allowed to purchase on these days.
How to save money on your food shop
Consumer reporter Sam Walker reveals how you can save hundreds of pounds a year:
Odd boxes – plenty of retailers offer slightly misshapen fruit and veg or surplus food at a discounted price.
Lidl sells five kilos of fruit and veg for just £1.50 through its Waste Not scheme while Aldi shoppers can get Too Good to Go bags which contain £10 worth of all kinds of products for £3.30.
Sainsbury’s also sells £2 “Taste Me, Don’t Waste Me” fruit and veg boxes to help shoppers reduced food waste and save cash.
Food waste apps – food waste apps work by helping shops, cafes, restaurants and other businesses shift stock that is due to go out of date and passing it on to members of the public.
Some of the most notable ones include Too Good to Go and Olio.
Too Good to Go’s app is free to sign up to and is used by millions of people across the UK, letting users buy food at a discount.
Olio works similarly, except users can collect both food and other household items for free from neighbours and businesses.
Yellow sticker bargains – yellow sticker bargains, sometimes orange and red in certain supermarkets, are a great way of getting food on the cheap.
But what time to head out to get the best deals varies depending on the retailer. You can see the best times for each supermarket here.
Super cheap bargains – sign up to bargain hunter Facebook groups like Extreme Couponing and Bargains UK where shoppers regularly post hauls they’ve found on the cheap, including food finds.
“Downshift” – you will almost always save money going for a supermarket’s own-brand economy lines rather than premium brands.
The move to lower-tier ranges, also known as “downshifting” and hailed by consumer expert Martin Lewis, could save you hundreds of pounds a year on your food shop.
Every time you go to spend, think about if you want or need the item.
Check what you already have in your wardrobe, fridge or cupboards before you make a purchase to avoid wasting money.
If you want to buy something then wait 24 hours before you pay for it to avoid making impulse purchases.
Round up challenge
In this challenge, you round up any money that you have spent and put the extra cash into a savings account.
For example, if you spend £9.50 on an item then you save the extra 50p.
Although it might sound like small amounts, if you do this with everything you buy then the money will add up.
Several banks including NatWest, Monzo, Starling and Chase will allow you to do this through their online banking apps.
Check with your bank if it is available.
Andrew Hagger, founder of money advice website Moneycomms, said: “Most banks offer this option and it’s a useful habit that will help build your savings balance day by day.
“You’re squirrelling away money without realising it. It’s a very flexible option and you can always withdraw the money bank into your bank account if and when you need to.”
100 envelope challenge
If you use lots of cash then the 100 envelope challenge could be a good option for you.
Simply label 100 envelopes from one to 100 then put them in a container.
If you are short on time then you can buy special folders with 100 pockets inside.
Every day pick one envelope and put the amount of money on the front of the envelope inside.
For example, if £93 is written on the front then you put £93 inside.
Once 100 days have passed you should have squirrelled away £5,050.
If this seems like a daunting amount then you could do the same but with 50 envelopes.
Or you could pick out an envelope each week instead.
1p challenge
If your budget is very tight then the 1p savings challenge may be for you.
You start by saving just 1p then up the amount you save by 1p per day.
So on day one you save 1p, on day two you put aside 2p, then on day three it’s 3p and so on.
By day 365 you would add just £3.65 to your pot.
If you start today you will have an enormous £667.95 by January 1, 2026.
You can begin this challenge at any time so it does not matter if you did not join it at the start.
Simply add up the total amount you would have saved on the days you missed and start from there.
Cancellation challenge
In this 12-month savings challenge, you check what subscriptions you are paying for each month and if you still use them.
You make a note of what you have cancelled and put the money you have saved into your savings account instead.
This means you can save money while still having the same amount of spending money each month.
You can check which subscriptions you are paying for by logging into your bank’s app or website.
Cancel all subscriptions directly with the company you took them out with, rather than with your bank.
Consumer champion Martyn James said: “For far too long businesses have tricked, manipulated and locked us into subscriptions for things we don’t want or need.
“If you’re willing to scroll back through a year’s worth of bank, credit card and e-payment service statements, you could find huge savings by spotting subscriptions and cancelling them.”
Mr James added that he saved more than £1,300 when he did this at the start of last year.
Small change challenge
The idea for this challenge is simple.
At the end of each week set aside any spare change you have in a piggy bank, jar or wallet.
You can do this for anywhere from a month to a whole year.
Once your set goal time has passed just pay the money into a bank account or spend it on a specific purpose, such as a holiday.
There is no pressure to save set amounts each day or week, which makes this challenge ideal for people who struggle to build a savings habit.
Where should I store my cash savings?
If you usually pay for things with coins or notes then you may prefer to use a jar or piggy bank to save your money.
But you could increase the amount of money you squirrel away by using a savings account.
This is because you earn interest on all of the money you save.
You can find the best savings account by using a comparison website such as MoneyfactsCompare or Compare the Market.
Your bank may also offer pots, which let you keep your savings separate from other money you have and earn extra interest.
If you may need access to your cash then open an easy-access savings account, which allows you to withdraw money fee-free.
Or if you can lock your money away for longer then choose a fixed-rate bond or notice savings account.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
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