With a new year comes a heap of great new chances to save money, and being at the start of a new year I am going to share with you one of my favourite ways to help people save money.The idea is fairly simple, but the amount of money you save can really add up if you stick with it and don’t cheat.
The basic principal is this – Choose a small dollar amount, like say $1 or $2 and put it into a jar or a savings account at the start of the week (Note: I think a savings account is better as it will accrue interest, but whatever floats your boat is fine). Then next week (Week 2) double what you put into your savings account in week 1. So if you put $1 in your savings account in week 1, in week 2 you would put $2 into the account. Week 3 would continue in the same vein with $3 going into your account.
The whole idea behind this is that it helps people to realise just how much impact an extra dollar a week can really make and you can end up with some serious coin in the bank at the end of the year.I have done something up in Excel to show you exactly what I am doing and what the end result can look like.
This example uses a starting amount of $1
Another example although this time we will start with $2.
You also need to remember that these figures don’t include bank interest, which will compound and earn you even more money by the end of the year.
So what do you think? Do you have any hot money saving tips that you would like to share with me?