Tips on Saving $10,000 in a year
Whether you’re saving for a first house, retirement, or your wedding, lots of us could do with $10,000. However, living costs, hidden expenses, and shopping habits have all made saving money difficult to do. It can be hard to save $100, let alone $10,000!
Saving a large sum of money may not be easy, but it isn’t impossible. If you want to save $10,000 in a year, but aren’t sure where to start, read over our tips below. Best-case scenario, you’ll save a lot more than you ever did before. Who doesn’t want to do that?
Do The Math
Saving $10,000 over the next year is a hefty goal, but knowing exactly how much you have to save each year can help you focus on the objective each month.
To save $10,000 in a year, you’ll have to save $27.40 a day, $193 each week, $385 every fortnight, and $834 each month.
You can approach this goal by saving a set amount every period, or by saving different amounts each session. For instance, if you’re just starting out saving, you may want to save a few hundred dollars each month, then work up to $834. This may be useful during more expensive periods, like during Christmas or after a vacation. This can also be useful if you’re trying to break spending habits so it’s not a huge shock to the system.
How To Save $10,000 in a Year
We’ve covered how much you need to save each day, week, or month, so here are some tips on achieving your goal.
The Reason Why
Like any goal, it's important to fully understand why you’re taking this challenge on. If you have clear reasons for saving $10,000, thinking about them will make saving money easier during hard times.
Everyone has a different purpose for saving such a large amount of money. Whether you’re saving for the present or the future, you’re going to be making sacrifices, so make sure your reason matters to you.
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If you’re not fully committed to this finance goal, you’re more likely to falter when it gets hard in the future. Full commitment will make it easier to persevere during difficult periods, making you more likely to succeed.
Sharing your goal with someone can help the process too. If you have a partner, you can share the goal so that you save $5000 each. If you both want to save $10,000 each, you can push each other when things get tough. This goes for single people as well! Ask your close friend or family member for support, or see if they want to take the challenge as well! Sharing the same goal with someone can keep you both motivated and accountable for your actions.
Make A Budget
If you’re not used to budgeting, creating a budget is one of the best ways to ensure you’re sticking to your goals. Before you choose an amount to save each pay period, you need to make sure that you can pay for essential expenses first. These include amenities, rent/mortgage payments, and grocery bills.
If you can, look at your past expenses like takeaways, eating out, coffee, or shopping habits. See if cutting down on these will help you save more towards your goal. Seeing your expenses down on paper can help you identify how you can save money more efficiently.
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Automatic savings isn’t a requirement, but it can be helpful for those that struggle to save money. One way of doing this is creating a direct deposit. Your money will automatically transfer into a savings account once you get paid.
Some employers that pay through direct deposit may offer to deposit your pay into several accounts. You may decide to have a larger amount going into your normal account, then let the rest of it go towards a savings account.
If you can’t create a direct deposit, some banks may let you create an automated transfer. You can opt for a certain amount of money to be transferred to your savings account each week, fortnight, or month.
Automated savings make saving money easier, as the money leaves your account without even thinking about it. However, you need to keep checking your regular account to make sure you have enough to cover your bills. If the money left over isn’t enough to live on, an automated transfer may not be the best route for you.
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Put The Money Away
Even if you’ve saved a nice amount of money, it can be tempting to dip into the pot now and again. To avoid doing this, you should have a separate savings account for your $10,000. In most cases, you should be able to create more than one savings account at your regular bank.
If you add the money to your regular account, you may spend it by mistake or use it for other expenses. Having the money in a specific savings account makes it easier to look at your progress each pay period. It also helps you think twice about spending the money too.
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Sell, Sell, Sell!
Over time, we all accumulate a lot of stuff that we don’t need anymore. You can give these things to somebody who needs them and make money in the process! Clothes, books, furniture, tools, games, and accessories can all be sold, just as long as they’re in good condition.
There are lots of ways to sell your belongings. Apps like Depop and Vinted are good for selling clothes, or you can opt for online services, like eBay, Craigslist, and Facebook Marketplace. You can also sell your things in person through friends and family or yard sales within your community.
Easy Saving Methods
Saving money does take work, but here are some saving methods that don’t involve going through a lot of trouble.
Cable TV is a large expense that costs a lot of money. Most people spend around $100 on cable each month, which works out to $1000 every year. Streaming services like Netflix and Hulu are much cheaper and have many entertaining viewing options. You might find that you don’t even miss cable!
Changing cell phone carriers can also save you money. With a little bit of research, you can find less known carriers that cost much less than the major ones. Some options include FreedomPop, Ting, and Cricket Wireless.
Lastly, searching for cheaper insurance providers can help you towards your goal. Insurance companies often compete with each other, so you don’t have to look too hard to find better rates. You may also want to look at your current plan and see if you can reduce the coverage to save a little more.
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Saving $10,000 in one year is a big goal, but there are ways to make achieving it a little easier. You need to know exactly how much you have to save, but focusing on your reason for saving can help you stay committed when times get tough. Remember, saving any amount of money is difficult, so don’t feel disheartened if you don’t reach your goal. Chances are you’ll have learned good financial habits, so you’ll be better prepared for the future.
Your check stubs can be a great way for you to keep track of your finances and reaching that dream goal of $10,000.