Whether you are saving for a rainy day fund, a down payment on a house, a used car, or pretty much anything else, $10,000 is a big milestone in any financial journey. But if you want to save $10,000 in a year, you are going to need a solid plan.
You see, saving 5-figures in 12 months doesn’t just magically happen. You have to be willing to adjust your lifestyle, and spending behavior to prioritize this worthy goal. But, with the right attitude, and the simple tips laid out in this post, I think you’ll find saving $10K in a year to be easier than you think.
So, let’s get right to it.
1. Save Before You Spend
Ok, so this is probably the most important tip when it comes to saving $10,000 in a year–or really any amount for that matter.
Whenever you get paid–and before you pay your bills, or spend any of the money on fun, food or entertainment–put however much money you need to save to reach your goal into savings. Then, live off the rest.
For most people, this might seem a little backwards, because they are used to saving whatever money is left over at the end of each month. But the problem with saving your leftover money, is that it is the lowest priority on your list. And low priority goals are rarely achieved.
So, if the goal is to save $833.33 each month, and you get paid twice a month, then put $416.67 into savings every time a paycheck hits your bank account.
If you get paid once a week, you need to deposit $192.31 into savings every time you get a paycheck.
If you get paid once a month… well, you get the picture.
If you want to achieve your savings goal, all you have to do is save before you spend. It’s as simple as that.
Oh, one other important thing, if you really want to maximize your savings, it’s important to put your money into a savings account that earns a decent interest rate. And if you’re looking for an awesome savings account, we recommend either the Axos High Yield Savings account, or the CIT Savings Builder. Both of these accounts offer a significantly higher interest rate than the national average, and you can open an account online in only a few minutes.
Seriously, switching to a better savings account could mean the difference of hundreds or even thousands of dollars of interest in the long run.
2. Decide And Commit To Your Goal
Every worthwhile achievement in life starts with a decision and a commitment. And saving $10,000 in a year is no different. You need to start your journey by deciding that you are going to do what it takes to reach your goal.
You aren’t just going to happen into $10,000. It’s going to take work and commitment. Remember, this is a 12 month goal, and a lot can happen in that amount of time.
So, make a promise to yourself that you are going to stick to your goal for an entire year. Now, commit yourself to your decision.
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3. Break Your Goal Into Small Pieces
The earlier you are in the process of achieving a goal, the more impossible it seems. Like standing at the base of a mountain you are getting ready to climb, your goal to save $10,000 can be a little daunting when you haven’t saved a dime.
This is why it’s important to break your goal into small, achievable, pieces. And when I say small, I mean as small as it takes for you to stop feeling overwhelmed.
For example, if you want to save $10,000 over the next year, you can break that into a monthly savings goal of $833.34. And if that goal is still too daunting, you can break it into a weekly savings goal of $192.31. If that is still too overwhelming, break it into a daily savings goal of $27.40.
When you break one large goal into a bunch of smaller goals, it makes anything seem possible.
For a breakdown of exactly how much you need to save, check out the table below:
|$10K In A Year - Savings Breakdown||How Much Do I Need To Save?|
4. Get Serious About Budgeting
If you want to save a serious amount of money, you need to plan and track your finances with an air tight budget.
Budgeting will help you eliminate waste, and prioritize your financial goals. And it will become your step by step guide to achieving your savings goal of $10,000.
For some awesome tips on budgeting, check out our popular post: 50 Budgeting Tips (For Every Stage Of Life)
5. Start a Side Hustle
If you don’t make enough money to save $833.34 each month, you have 2 choices. You can either adjust your savings goal to fit your income, or grow your income to reach your savings goal. The good news is, there is an abundance of opportunities out there to make extra cash. You just have to be bold enough to pursue them.
Here at BeTheBudget, we are all about finding legitimate ways to earn extra money each month. So, if you are passionate about something you can make money doing on the side, pursue it. If you have the energy to work a second job at night in order to better your financial situation, get after it! Every extra dollar you earn on the side is just a step closer to saving $10,000 in a year.
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6. Cut Unnecessary Expenses
Wasteful spending is the absolute enemy of every financial goal anybody has ever set. So, if you haven’t taken a fine-tooth comb to your expenses lately, now is the time. Why? Because the more expenses you cut, the easier your savings goal will become.
Let me put it this way: if you want to add an extra $1,000 to your savings every year, all you have to do is eliminate $84 of wasteful spending each month. For most people, that is not difficult at all. Just pack a few extra lunches each month. Call up both your internet and cell phone provider and negotiate your monthly bill. Sift through your recurring monthly subscriptions and cancel the ones you rarely use.
Examine every expense, and if it isn’t necessary, cut it.
7. Avoid Burnout
If you aren’t careful, all the side hustling, budgeting and expense cutting can lead to a bad case of burnout after awhile. So, to avoid that, be sure to have a little fun along the way. Remember, in every area of life, there needs to be balance. And, what is the point of making money if you never get to enjoy any of it.
In an effort to avoid burnout during your journey to save $10K in a year, be sure to allocate a little money for fun and entertainment each month. In other words, it’s ok to take your significant other out on a date once in awhile. Also, you don’t have to feel guilty about buying that $60 pair of shoes you have been saving up to but for the last 3 months. Oh, and you don’t have to eat ramen and apple sauce for every meal. It’s called bacon, and the reason it costs so much, is because it tastes wonderful!
Have some fun. Just don’t sacrifice your financial goals in the process.
8. Track Your Progress
One of the most important steps to achieving a long-term goal like saving $10,000 in 12 months, is to track your progress. And, I’m not just talking about looking at your bank account every couple of weeks. I’m talking about a constant, visual reminder that keeps you focused.
This might vary from person-to-person. You might want a progress tracker you can color in each time you add money to your savings. Or, if you are a more analytical person, a spreadsheet on your desktop might be a way to go. Whatever you choose, be sure to keep it in a spot that will catch your attention every day.
There is so much truth to the saying, ‘out of sight, out of mind.’ So, keep your goal in sight with a visual savings tracker you can’t help but run into on a daily basis.
9. Save Your Leftover Money
I know earlier in this post we talked about saving before you spend, but if you really want to fuel your savings, you should throw all your leftover money each month into savings as well.
If you start and finish your month with saving, you will be burning your savings goal from both ends, which will make it go even faster. If you really focus on saving your leftover money, you could save $10,000 much faster than you originally expected.
Wouldn’t that be nice?
10. Celebrate Your Milestones
Over the course of 12 months, it’s easy to get a little bored. So, similar to breaking your goal into smaller pieces, it’s important that you pre-define a few milestones to celebrate along the way.
This can be something as simple as toasting a glass of champagne every time you save $1,000. Or, if you want, you could celebrate the $5K mark with a nice dinner out to eat.
Whatever you choose to do, celebrating your milestones will keep you interested, excited and focused on your $10,000 goal.
Saving $10,000 in a year is a fun and exciting goal to work towards. And, if you break it down, and take it step-by-step, there is no reason you can’t achieve it.
In fact, $10,000 in a year might not even be a big enough goal. Maybe a year from now, you will be setting your sights on $10,000 in 6 months; or maybe, $50,000 per year. Whatever savings goal you set, if you follow these tips, you can achieve it.
Are you trying to save $10,000 in a year? We would love to hear about your journey in the comments below.
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