If you’re ready to focus on your savings goals and don’t know where to start, you might be interested in learning about the 5k in a year challenge!
Have you thought about what you would do with an extra $5000 in a year? Would you finally take your dream trip to Italy to indulge in fresh pasta and sip wine in the hills of Tuscany?
Maybe you would splurge on a timeless designer item you’ve been eyeing (and one that appreciates in value), or finally pay off your lingering student loan debt. Perhaps you’re simply interested in saving for your future self, and want to keep it aside as a growing nest egg for your future home or business venture.
Is it possible to save $5000 in a year?
Absolutely! The idea of saving $5K in one year may sound daunting, overwhelming, inconvenient, or even impossible. Though, what if there was a way that saving $5,000 in a year was made so easy, you would barely even notice that you’re doing it?
Keep reading to learn some easy and painless ways to accrue and build upon your savings to nail the 5k in a year challenge!
- Find your goals and reasons for saving
- Ways to get more excited about saving
- What are Braid Money Pools?
- How much do you need to save a month to save $5000?
- 5 Ways to painlessly cut costs to help you save
Find your goals and reasons for saving
Saving allows you to have peace of mind, help achieve your life goals and milestones, and allows you to improve your quality of life. Establishing and maintaining a separate savings fund for unexpected life events, repairs, or medical costs can also give you some relief, knowing that you have money set aside in case of emergencies. It also provides future financial security, helps you plan for larger expenses, a career change, or big life change.
Here are a few ways to get more excited about saving:
1. List out your goals
Create a list or vision board of what you’re saving for or towards. This will remind you of your purpose(s) for saving, and keep you focused.
2. Save with a friend
Take on the challenge with a friend, or your significant other (a great opportunity to double your goal and save $10k in a year together). This is a great way to make saving more fun and rewarding, while holding each other accountable.
3. Plan a small reward
Celebrate with a smaller reward once you complete your $5k in a year challenge! Decide that you’ll go out to dinner at that new restaurant you’ve been eyeing, or pop a bottle of champagne at home – make it feel special and a little indulgent (while reserving and preserving your hard-earned savings).
4. Watch your savings grow
It’s always fun to watch your balance grow. Check in on your Braid Pools anytime, to see your saving techniques paying off!
Braid provides modern tools and resources to make your savings experience as simple, seamless, and attainable as possible. Let’s jump in – time is money!
Ready to start your Braid Pools now? Click here to get started.
What are Braid Money Pools?
Braid Money Pools are a dedicated place to collect, manage, and spend money – it’s free to download and free to use.
Have you heard of cash envelope budgeting? It’s a simple, old-school method of allocating individual budgets to your common spending or saving categories (groceries, gas, restaurants, wellness/beauty, clothing, etc…).
To utilize the envelope system for the save 5000 in a year challenge, create Braid Pools for each of your saving categories or milestones. It will also be impossible to lose or misplace your digital envelopes – they live within your Braid account and are accessible from anywhere!
Braid Pools are an ideal place to put money aside – think of each of your pools as a mini savings fund.
Here are two ways to setup your saving pools with Braid:
1. Create one big pool to save all of your funds
After you decide how much money you want to set aside every week or month, set up Recurring Add $ to schedule regular transfers from your bank account to your Braid Pool. By using one Braid Pool, you can "set it and forget it" while achieving your savings goals.
2. Start multiple pools to breakdown savings milestones
Breaking down your $5K savings challenge into smaller milestones can build momentum and encourage you to continue to save as you achieve each milestone.
Here are some ideas ways to break down the $5K:
- In increasing or decreasing increments ($500, $1000, $1500, and $2000)
- Divide the total in half ($2500 and $2500)
- In quarters ($1250, $1250, $1250, $1250)
Create a pool for each of the breakdowns and have fun with naming your Braid Pools based on different goals and rewards that you are saving for. They can be big or small, for your longer- or shorter-term goals.
Ready to set up your $5K challenge savings pools? Click here to get started.
How much do you need to save a month to save $5000?
One suggestion is to break this goal down monthly, and/or divide the amount into smaller, more accessible chunks throughout the month.
- Per week: for $96.16 each week
- Per month: about $416.67
- 24 contributions a year: about $208.33
Use Braid’s Recurring Add $ feature to automatically schedule regular transfers from your bank account to your Braid Pools.
Putting this money aside to a Braid Pool ensures that it is out of sight and out of mind.
5 tips to painlessly cut costs and jumpstart your savings
A helpful way to help jumpstart your savings process is to evaluate your current expenses, and see how you can easily eliminate or pare down costs. You can then put this money directly into your Braid Pool, and add to your $5k savings goal.
Here are useful tips on how to save $5000 in a year.
1. Review your bank statements
Scan the last 3 to 6 months of your credit card statements for charges that you don’t recognize, especially if the charges re-appear monthly. There are many cases where you may have unknowingly subscribed to a service or agreed to ongoing charges that you are not aware of.
After canceling the charges, you can also set up a recurring monthly transfer of this exact amount to your Braid Pool. You didn’t miss it before, so you may as well have this money work for you and your savings goal.
2. Cancel unused subscriptions
Evaluate your monthly and yearly subscriptions and memberships. If you don’t use it, lose it!
3. Lower your monthly essential costs
Call your essential providers to ask them how you can lower your monthly bill. This includes cell phone service, internet, TV/streaming services, and auto/home insurance. This article by Clark.com has some great tips for reducing and reworking some of these monthly expenses with your providers.
4. Cut down on food delivery services
We love the ease of UberEats just as much as you do, though meal prepping or menu planning will help to cut down on unnecessary food deliveries, so that indulging in the occasional lunch order or takeout dinner will feel that much more rewarding and special.
5. Cash back for online shopping
If you shop online often, check out some of the available cash back portals for online shopping, such as Rakuten and Honey. They are simple and free browser plugins that offer cash back rewards for shopping with many major retailers (and they also suggest coupon codes to use during checkout). Literally free money!
Using Braid Pools will easily and confidently help you save $5k in a year. You’ll be able to keep your money aside in a safe place, access it from anywhere, and separate it for different goals.
Whether you decide to contribute to your pools weekly, biweekly, or monthly, the challenge is attainable and will help set you up for success towards your milestones, save for future expenses, and have a safety net for unexpected costs.
Now that you have these tools, the challenge is on!