Saving money every month is no easy task. Despite our best efforts, we often find ourselves in the same situation: at the end of the month, every pound spent is closely monitored to avoid putting our current account over the authorised overdraft limit. Rest assured, there are several techniques for saving money without pulling your hair out. The one we’re going to talk about today is a challenge that’s easy to set up: the 5 pound challenge.
What's the 5 pound challenge?
The 5 pound challenge is very simple to explain:
Every time you pay for your purchases in cash, if there’s a £5 note in the change you get back, then you automatically have to keep it to save.
- I go to the supermarket, buy a few items, the total price is 13 pounds. At the checkout, I pay with a 20-pound note.
- The cashier gives me change: a £2 coin and a £5 note.
- The change I got back included a 5-pound note, so I have to keep it for the challenge.
- In future, every time I collect a £5 note, I’ll automatically have to set it aside.
You’re free to choose where to store your notes: an empty vase, a piggy bank, a wallet for the challenge… The idea is to secure your budget in a place where you know you don’t have to use the money inside.
Want to save efficiently ? Discover the kakebo ! A small Japanese notebook, the kakebo acts as a real budget planner, enabling you to save your money week after week.
Setting up the 5 pound challenge
Before embarking on the challenge, you need to programme it first. This will maximise your chances of success.
What you need to do for the £5 challenge :
- Define a goal: how much do you want to save through the challenge?
- Define a duration: for how many weeks or months will the challenge be active?
- Print out a tracker: to make sure you follow the challenge correctly, you need to use a tracker to keep track of your savings.
That’s the basis of the challenge! Why do you want to save money? To finance a particular purchase? A weekend or a trip?
Defining your objective will keep you motivated throughout the challenge, especially at those times when you’re likely to break down and dip into your savings.
Concentrate on this objective throughout the challenge. This applies to any type of challenge, so it’s a good idea to set yourself a goal and stay focused on it.
This is a vital factor in determining how long it will take you to reach the amount you want to save!
Scheduling the duration of the challenge is also an additional motivator: if you’re going through a difficult time, thinking about the number of days or weeks left will help you complete the challenge and reach the budget you’ve set yourself.
Generally, the challenge lasts for 1 year, so you can accumulate a substantial amount of money.
However, there’s nothing to stop you deciding on a longer or shorter period – the aim is to adapt the duration to your savings target.
Obviously, if you want to save £2,000, 2 months is far too short a period.
Our advice: if you don’t have a specific goal, start the challenge with 1 month. At the end of the challenge you can decide to do it again for a longer period if it was easy to keep to the first month.
If you decide on a fairly long term (over a year), we advise you not to keep your notes and money in cash: with inflation, their value will naturally fall.
Ideally, put your money in a savings account with the best interest rate.
If you’re looking for another challenge, check out the 52-week challenge, which will enable you to save up to £1,400 in 1 year.
Print a tracker
How can you measure the success of your challenge or your path to success? With a tracker!
A tracker is a way of keeping track of your progress. It takes the simple form of a printable sheet like the one below!
The instructions are simple and written on it: for each note you manage to save, you can cross out a box. This way, you can track your progress.
Find all the other money-saving charts here.
Free printable 5 pound challenge
We’ve told you: challenges are only worthwhile if they can be measured.
Above is an example of a £5 challenge tracker to print out, but you can find them just about anywhere else on the internet:
- For sale: on Etsy or Amazon (follow this link for the best prices)
- Free: directly from Google using existing trackers
You can even create your free £5 print challenge directly from a visual creation tool like Canva.
How can I save money in 52 weeks?
There are several techniques for saving money in 52 weeks. The simplest is to set up the 52-week challenge: this involves investing as many pounds as the current week’s number throughout the year.
What's the best savings challenge?
Many challenges are effective when it comes to making savings. The easiest challenge to set up (and probably the best) is the £5 challenge: it’s simple to understand and quick to implement in your daily life. Go to this article if you want more money-saving challenges.
We hope this little £5 challenge will help you see your savings more clearly and encourage you to save seriously! You can subscribe to the jowi.co.uk newsletter for more tips on saving, each week an article is published on this subject. Maintenance is up to you.
Passionate about savings and investment topics. I modestly try to offer you simple, sometimes not so simple, solutions to beat inflation.