The 52 Week Challenge is popping up again all over the internet. It promises to be an easy way to save over $1,000 by the end of the year. I think it is a good idea in principle but it is definitely not ‘easy’
(If you are not reading this post at www.howisavemoney.net or in your feed reader, it may have been stolen from my site.)
I wrote about the 52 Week Challenge in the past and stated why I would not be joining it.
This year, my feelings have not changed. I do not believe that the challenge as it stands is ‘easy’.
How it works
You number off the weeks of the year starting from 1 to 52.
Each week you save an increasing amount, starting from $1 and ending with $52 in the final week.
Every week corresponds to the amount that you need to save. So in week 5 you would save $5 and in week 30 you would save $30
The amounts seem small enough, however, in December you would need to save $49+ $50 + $51 + $52 = $202. Yes, in December…when everyone is most likely buying Christmas gifts.
Another version reverses the weeks so you save $52 the first week. I think this also difficult as you would need to save $202 in January. This may again be problematic as people are paying off debts incurred in December.
While I like the idea of saving on a regular basis I think this system could be improved. Many of the posts call for saving in a jar. This is really a bad idea as money in a jar is not earning interest.
Some of the posts also call for moving the money manually every week. This means you have to tackle this task four times a month. Having to do this so frequently is one of the often cited reasons for people quitting. It just seems like too much work!
What I Do
I treat my savings as a bill and have it set up in my budget. My savings amount is preset to automatically transfer to a separate savings account. I do not have to think about it. The money goes out of checking before I can miss it. This means I am not tempted to use it just because I see it.
Are you trying the 52 week challenge? Let me know your thoughts on it.
I guess I either never heard of this or forgot about it if I’d heard of it in years past. I agree with your points. Structurally, it isn’t designed to work. I see the points though. To start small now theoretically develops habits that will allow you to make changes throughout the year, so that $52 by the end is manageable. On the other hand, starting big lines up with everybody’s big pot of motivation that they start the year off with.
Either way, it’s probably something everyone will soon forget about. Until next year, of course 🙂