In a previous post I briefly discussed money challenges and how people use them as extra motivators to either boost savings or pay down debt. Whether you’re saving for a vacation, a house or just want to improve your money management skills, you can never have too many tools or tricks at your disposal. This is why I encourage people to get creative about improving their financial behaviors. Not everyone gets as excited about personal finances as I do, so it doesn’t hurt to find a way to spice it up.
Today’s post is dedicated to the 52 Week Money Challege.
What it is: According to experts, it takes between 21 days and 2 months to build a habit. If you are a novice looking to establish a patter of good behavior, this is the right place to start. This challenge helps you build consistency while gradually ramping up the levels of savings to give you better results. It sets long-term goals which forces you to understand that good money habits are a life-long strategy rooted in permanent change and that wealth building is a marathon, not a sprint.
You start out by selecting a small amount of money to save the first week of the year and you add to it every week until the last week. You start with a small amount, usually about $1 and you add a dollar every week until the last week of the year where you would deposit $52.
Outcome: You should have no less than $1,378 as of the last week of the year.
Variations: You can ramp it up by doing $5 on the first week and adding five dollars every other week after that and you would end up with $1,755 as of the last deposit. If you’ve already done the challenge and you’re really looking to spice things up and push your limits, you can try depositing $10 the first week and add $10 every two weeks. Although this means you’re looking at a deposit of over $500 the final month, you’re also looking at doubling your savings for the year to $3,510. Other variations include the reverse challenge where you start saving the most in the start of the year as people find it more difficult to save as the holidays roll around.
Why I like it: It’s a great starting point for anyone who is just starting out. It helps you understand the value of saving early and often and most importantly, it helps build good habits.