So you’ve decided that you want to save some cash and have decided on a goal of $10,000 in just one year! Is this even possible? Can it be done without massively reducing your spending habits or life enjoyments?
In actual fact, not only is $10,000 a very realistic target goal, but with some clever life hacks and tweaks to your day-to-day expenditure, it is not only possible but much easier than you may think!
In this article, we will look at ways in which you can reduce your expenditure, make smarter choices, and save some serious cash in just 10 simple steps. So, are you ready to get started?
How To Save $10,000 In A Year?
When looked at as a whole, $10,000 can seem like a daunting and unrealistic amount. Even when it is broken down to a monthly figure of £833.33, it can still seem like a mammoth task.
However, when we consider it as a daily figure, $27 seems much more manageable. And now that you know the breakdown of how much you need to save on a daily or monthly basis to reach your target goal, you can start to make realistic changes to make that happen.
Let’s take a look at our top 10 tips to save $10,000 in just one year:
1. Save Before You Spend
Generally, when people try to save money, they look at their monthly paycheck, spend the remainder on food, entertainment, and day-to-day expenses, and then see what they have left to save. Which more often than not, is not very much.
By saving what you have left (if anything), you are creating a mindset that saving money is a low priority, it is the last thing left on the list. And generally speaking, low priority goals are very rarely achieved.
So what can you do to change this?
Firstly, whether you get paid weekly, monthly, or twice a month, sit down and work out your base costs for living. How much is your mortgage or rent? How much are your baseline bills including groceries and gas?
Once you have this information, deduct it from your paycheck and see what you have left. Now, based on your saving goals, deduct a realistic amount of money and transfer it to a savings account. Whatever is left is your disposable income to spend on luxuries such as eating out, mall trips, or entertainment.
By turning your disposable income into your savings, you are prioritizing your saving goal and you will enjoy those indulgences, even more, knowing that it is not costing you your savings.
Another point to add here is to move your monthly savings into a dedicated savings account. This way you will earn interest on any amount deposited and it will remove the risk of accidental spending as opposed to keeping it in your checking account.
2. Keep The Change
This will sound like a fairly obvious tip, but how many times have we tossed our change in a coat or jeans pocket, or thrown it to the bottom of a bag without a second thought? By making a conscious effort to save this cash, it could soon add up to more than you thought possible.
Some banks, such as Bank of America, offer a system where you can round up your purchases to the nearest dollar and then save this difference away from your main account. This is a simple way to round up your change so that it is saved effectively.
If your bank doesn’t offer this system you can store the roundup cash yourself and deposit it directly to your savings account on a monthly basis.
This will by no means become the main contributor to your savings, however, you will be surprised how much this technique will save you over the course of 12 months.
3. Save On Bills
Without having to cut back on your monthly outgoings in order to reach your monthly saving goal, a really good way to start saving is to look at your current outgoings and see where you can cut them down.
How long has it been since you reviewed your service providers for your utilities, entertainment packages, insurance premiums, or cell phone?
Without realizing it, millions of Americans each year are simply auto-renewing their service plans without negotiating better terms.
Do you currently use all of the services on your cell phone bill? Could your vehicle insurance be reduced? Have you been a loyal customer with a service provider for a long time and deserve a financial incentive?
Have a phone conversation with your service provider’s and see what they can do to help. Ask if they have any better deals to offer you.
You will be surprised how much room companies have to offer better deals to their long-standing customers. And in turn, you’ll be surprised how much you can shave from your monthly outgoings and turn them into savings.
4. Plan Your Meals and Cut Back On Eating Out
When you’re busy it is so easy and convenient to grab food on the go, eat out in the evening, or grab a take-out. After all, eating is not only essential, but food is one of life’s greatest enjoyments right?
However, have you ever really considered how much you’re spending on your morning coffee? Or by grabbing lunch out each day? Or your weekly (or more) take-out order?
Whilst we are by no means suggesting that you need to live life without any luxury to save some cash, you can make some simple changes to reduce your expenditure.
Set some time aside and work through your checks for a month and how much eating out is actually costing you. A lot more than you thought?
Invest in a take-out cup and make that coffee from home before you commute to work. Set yourself a goal of how many days per week you will take your own lunch to work and stick to it.
You can also make huge savings on your grocery bills by setting out a weekly meal plan, writing a shopping list to take to the store with you, and not making unnecessary purchases.
Invest in some good tupperware and freeze any leftovers for future dinner options, or use it for your lunch the next day.
Any savings made compared to your previous monthly average spend can be transferred straight into your savings account. On average, American families spend thousands per year on eating out and wasting food. You will be surprised how a few simple changes can make a big difference to your saving goal.
5. Put Aside 1 Hour A Day Of Your Paycheck
This simple tip is a manageable way to make a big contribution to your savings account. Most financial experts advise that you should try to save 20% of your salary for a rainy day. However, for some, especially if taken out as a chunk at the end of each year, or when it is mentally compartmentalized as such a large sum, it is unmanageable.
By allowing 1 hour of your paycheck per day to be included in your savings, you will mentally deduct this amount from your income and only see it as your savings. This micro-savings strategy is an easy way to mentally and physically put aside some of your earnings and convert them to your savings.
6. Start A Side Hustle
Using your spare time to start a side hustle can be a great way to increase your monthly income without burning you out. In fact, by increasing your earning capacity by just one hour a day could equate to thousands of dollars each year.
These micro jobs are often available through online platforms which you can pick up in your free time to start earning some extra cash. Make a list of your skillset and have a look through dedicated micro job sites to see what is available.
If you love animals and the outdoors, you could also advertise your services as a dog walker or pet sitter in your neighborhood.
Another consideration to add here is whether you need to start a side hustle at all. If you’ve made a list of your skills and services and thought ‘dang, I’m a pretty versatile and competent person’ – you could always take this list to your current employer and try to negotiate a raise. It’s worth a shot, right?
7. Sell Unwanted Goods
One of the easiest ways to free up some cash without making any changes to your day-to-day life is to sell any unwanted goods within your household. Take some time to create an inventory of items you haven’t used for a period of time and list it on a selling site.
This can also be done for clothing, toys, and electronics and will be a popular choice in the run up to the holiday season.
If you use this listing as a passive way to increase your income, you will soon be surprised how much value you can add to your savings.
8. Swap Instead Of Buy
Similar to the above, there are lots of swap and sell sites where you can link up with local neighbors to swap your goods for theirs instead of buying new ones.
This is an extremely useful way to save some money in the holiday season and you can find yourself some real bargains. Think of it as a massive yard sale!
9. Prioritize What You Buy
This is a tip that will be easier for some to utilize than others. If you have a serious passion for clothes or make-up, or new gadgets and toys, then simply saying not to buy it will be fruitless.
Instead, don’t deprive yourself completely but prioritize your purchases. Set aside a goal out of your disposable income and work towards that. For instance, instead of a trip to the shopping mall every week, go once a month and only spend what you would have done on a weekly trip.
This way, you will look forward to treating yourself to your purchase and feel good that you have worked towards that goal.
It is also useful to ask yourself the following questions before making a purchase:
Do I Love It? – Is it something I will treasure or will it just be thrown in a drawer and forgotten about
Do I Need It? – Can I live without this item or is it a necessity?
Do I Already Have It? – Do you already have a perfectly good alternative that you can manage with for now?
Try to remember why you have set yourself this goal in the first place. Are you trying to save for your future or a substantial future investment such as a house deposit or college fees?
When you consider the bigger picture, you might realize you don’t need or want the product at all.
10. Get A Cashback Card
Another way to save some cash from your existing spending is to invest in a cashback card. These credit cards typically offer a percentage of cashback for purchases made through the card. If you are using your card frequently to make purchases, you can increase your income stream very easily.
Have a look through your standard average monthly transactions and see which ones could be charged to your cashback card instead. Look to pay for groceries, dining out, gas, and utilities via your credit cashback card instead of paying for it directly from your checking account.
Once transactions have been made, transfer the amount from your checking account to pay off the balances in full. Then simply transfer the cashback amount to your savings account. You will be surprised how you can leverage your existing spending habits to fulfill your saving goal.
Final Thoughts
So whilst $10,000 a year might seem like a big saving commitment, it is not only doable but manageable if done sensibly.
That being said, it won’t be without its sacrifices. You will have to make changes to your spending habits and thoughts on how you spend your money. You will have to spend some time working through your finances and contacting your existing service providers to negotiate new terms.
You will make changes to your eating habits and the way you look at your necessary outgoings to shake up how you feed your family.
All in all, you will begin to reconsider every aspect of your life and prioritize your spending habits into categories of essentials (such as food, rent, and bills), necessities (such as new clothes, appliances, and electronics), and luxuries (such as movie trips, take-out, and restaurant visits).
Overall, it may be tough at times, but try to stay focused and see the bigger picture of why you are making these changes in the first place and what your ultimate goal is. And let me tell you, in 12 months when you look at the savings you’ve achieved in just one year, you won’t feel like you’ve missed out at all.
Hi, my name is Deborah White, and I love to save money where possible. I will be the first person to admit that I am frugal, but when you have three children and two low income salaries, saving money makes all the difference. This is why I decided to set up this site, to help others save money too.
