Saving money can seem difficult, especially when you’re just getting started. Spending is easy and often times necessary. We need to spend money to keep a roof over our head and feed our family, which can make saving money not seem like that much of an urgency priority.
On the contrary, saving money is extremely important and crucial to your financial health. If you want to be able to afford an unexpected expense or emergency, you’ll want to rely on your savings. If you need to pay for a large expense like a new car or a down payment on a home, having money saved up can definitely help.
If you need or want to save up a lot of money like $10,000, don’t feel discouraged. In this post, I’ll walk you through the steps to take to be able to save up $10,000 in 12 months assuming you’re starting from $0.
Set Yourself Up For Success
Saving money requires motivation, dedication, and most importantly mindset. When you begin working toward your goal to save $10,000 in one year, you’ll need to set yourself up for success and that starts with changing your mindset.
If you have a negative mindset or just don’t believe you’ll be able to save up a significant amount of money, you’ll fail before you even begin. It’s important to get rid of all your excuses and prioritize your goal so you can stay focused.
You may even want to tell someone about your goal for accountability and support throughout the next 12 months.
Next your want to confirm your goal and decide how much you’ll set aside each month. If you plan to save $10,000 in exactly 12 months, that means you need to save at least $833.33 per month.
Open a savings account if you haven’t already and consider setting up automatic transfers so you can stay on track with your weekly/monthly goals.
Make Lifestyle and Budget Adjustments
When you set a large savings goal, it’s important to make lifestyle and budget adjustments early on so you can free up more money to set aside.
Coming up with $833.33 per month or $208.33 per week is a big chunk of money so you’ll have to make plenty of room in your budget to be able to afford it.
My best advice to people who want to trim their budget is to look it over line-by-line and analyze their spending. Then, question the validity of every expense.
See if you can lower your grocery budget by $25 per month. If you’re buying lunch 5 days a week and spending $6.50 each day, cut down to bringing your lunch for 4 days and only going out for lunch one day per week to save $26 per week or $104 per month.
Can you obtain a lower insurance rate? I just compared quotes for car insurance and found out I could drop my premiums by $20 per month and still receive the same coverage. If you use an insurance comparison tool like QuoteWizard.com, you may realize that you can save even more than I did.
Maybe you can cut down on exchanging gifts with friends and family for holidays and buying new clothes. Try to give your time or provide a service instead of spending money to show your appreciation for loved ones.
Also, check to see if there are any free activities or fun events in your area so you can save money on entertainment. I’m always checking with my local library and park district in search of free events and activities for my son. The other day, I found out about a free art camp that will be starting up in the summer along with a free softball league.
Another thing you can do to lower your expenses and control your spending is to switch to an all-cash budget so you’re not tempted to overspend with credit cards.
You can also try going on a no spend week once every month so you can find creative ways to get by without spending any money.
Find Ways to Earn More
By utilizing the efforts mentioned above, you can probably save hundreds of dollars per month. However, it might not quite add up to $833.33 though.
That’s where earning extra money comes in. In order to meet your savings goal for the year, getting a side hustle or a part-time job can help a lot. If you’re able to save $416 per month by making lifestyle adjustments and trimming your budget, all you have to do is focus on earning at least $416 in extra income.
Don’t have the time or energy to work a second job? Consider getting a flexible side hustle. If you like to write, you can start freelance writing and charge anywhere from $50 – $100 per post starting out.
You can also do virtual assistant work is you have good typing and communication skills and want to help other people run their websites, social media, and other aspects of their business.
Walking dogs and pet sitting or babysitting is another option for extra money. You can use sites like Swagbucks to earn points which can be redeemed for gift cards or cash, sell items online, tutor, sign up for Inbox Dollars, or take surveys online.
For more ideas on flexible ways to make extra money, check out these two posts:
Don’t Sabotage Yourself
Finally, you want to make sure you don’t sabotage your own progress. Saving up $10,000 in one year is a huge goal but 12 months is also a long time.
That means there’s plenty of time to fall off track and lose motivation. However, there are a few things you can do to help ensure you reach your goal:
- Put your savings in another bank account that you won’t have easy access to. This could be an online bank account or just a savings account with a separate bank so you can’t easily transfer and money to yourself.
- Set up automatic transfers right when you get paid or ask your employer to withhold some of the money from your paycheck for you so you never see the funds you’re stashing away
- Make transfer more frequently if you want to feel like you’re making more progress
- Remember to treat yourself in small ways as this will help motivate you to keep going (this doesn’t always have to involve money and can be something as simple as taking a day off from your side hustle or having a relaxing movie night with a library movie and home-baked dessert)
Saving money is a habit that becomes easier the more you do it. By following all these steps, you’ll be much more likely to get into the habit of saving regularly and meet your goal quicker.
Have you ever set a large savings goal? I’d love to hear your thoughts on why you think you met that goal or why you didn’t.