Bonkers savings challenges revealed – and how to save money in a way that actually works

So, we’re into week three of the new year. How are you feeling? Still pumped up for 2022, or weighed down by work, the weather and worries about the economy?

If you’re tending towards the latter, I totally understand. It doesn’t help that we’re all being bombarded with the usual advice about how to live our best lives in 2022. And when it comes to our personal finances, there are some supposed formulas for success out there that are not so much motivating as masochistic.

At the more sensible end of the spectrum is the 52-week saving challenge. This is how it works. You start in week one by saving a pound. You then save £2 in week two, £3 in week three and so on. You get the idea. It all culminates in week 52, where you save a maximum of £52. The total amount you save would be £1,378.

The 52-week challenge can be one helpful framework for kick-starting your next Christmas fund or chipping away at your first home deposit. But as with most online phenomena today, some people are taking the whole thing too far. Savings challenges are getting more ambitious – and alienating – with every passing year.

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One challenge dares you to save £5 more every week until the end of the year. So instead of saving £52 in the last week of December, you’d be saving £260. Another – the envelope challenge – requires you to get 100 envelopes, number them one to 100 and pick two at random per week. Whatever amounts are written on them, you tuck those sums up inside the envelopes and put them on one side. Apparently, you’d have more than £5,000 stashed away in 12 months’ time with this method.

Putting aside the hassle of withdrawing cash every week for this purpose, what happens if you’re unlucky and pick out a combined sum of £199, but you’ve only got £100 in your account?

Of course, a savings challenge should be, well, a challenge. All of us can save a penny a week but what would be the point? Plus, most people are so divorced from the savings mindset, they might appreciate something that will get them over that initial hump and trigger a habit that will soon feel easy.

But it can’t be a one-size-fits-all exercise. People on lower incomes will find saving a few pounds a week the equivalent of climbing Mount Everest. They need to avoid restrictive, arbitrary challenges at all costs and concentrate on what’s achievable.

The Help to Save scheme offers 50p for every £1 saved over four years up to a maximum of £50 per month. It’s a useful hack for those on working age benefits. But it’s not very well-known because it isn’t profitable for influencers and financial companies.

Ask yourself: if you can afford the sums involved in the envelope challenge, why not just put £400 in a savings account every month and be done with it? It would be a lot more straightforward. The answer is that as with so many things today, it’s not enough to pursue your goals quietly. It feels like you’ve got to show off about how well you’re doing on social media and, if you’re an influencer, come up with all sorts of gimmicks to attract eyeballs (and lucrative commercial partnerships).

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Maybe I’m being a bit harsh. Put it another way. Imagine your mate Dave came down the pub and said: “Hey guys! I managed to save five grand last year using envelopes! Isn’t that awesome? Do you want me to tell you all how I did it?” If he then explained the method, you’d think it was bonkers, totally impracticable, and not sensitive to those really struggling in the group, before slinking off to let Dave pick up the tab, since he’s obviously Mr Moneybags.

Saving isn’t a competitive sport. It’s our own private trek – one in which we might take two steps forward, one step back. And while I applaud any attempt to make finance fun, we can’t ignore the fact that today, saving is a hard slog. Millions of people can’t afford to do it and even those who can find themselves battling dreadful interest rates, rising living costs and the demoralising enormity of expenses like housing.

Round-up savings can help – this is where your bank (usually a digital-first one) rounds up your spending to the nearest pound, automatically putting the spare cash each time in a savings pot. You could also put a multiplier on it to supercharge your savings, something I did last year to help buy furniture for my new flat.

Otherwise, it’s about making hard choices if you can and sticking at it through thick and thin. It’s not a strategy that sizzles on social media but trust me, it works.

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