Monday Memo| Detail No.85 | January 22, 2024

Janaury Theme— Out with the Old, In with the New.

Hi lovelies,

It's a Money Making Monday on the street of DETAILS.

Not that M.M.M, lol.😂

We all cringe every time we check our savings account balance. Between "I cannot-kill-myelf" spending, you-only-live-once debit alerts and daily expenses, building a solid rainy-day fund can feel impossible. But what if growing your savings were fun?

On today's memo we will highlight some of the trending formulas to create steady saving habits to make your money compound overtime.

Shall we? Yes, please!

Weather Wednesday Challenge

Make your savings feel more like a game with the weather Wednesday challenge. Here’s how it works. Each Wednesday, you’ll check your city’s weather forecast for the day’s temperature and make a savings deposit by multiplying a fixed amount of 200 naira and saving the total amount.

For example, if the day’s temperature is 23 degrees, multiply it by 200 naira. That is #4600, transfer #4600 into your savings account. So easy!

Lets do a little calculation, if the weather is similar in all the four wednesdays in a month. That means you have saved 18,400 naira in a month. Right? Right!

That means, you will save more during the hotter months and a bit less when the temperature drops.

If you're in a foreign country, you could transfer the exact temperature.

The variability helps keep the challenge interesting and committing to making a transfer every Wednesday helps you to build a consistent saving habit. The key is to choose a metric that makes sense for you and commit to doing it consistently. 

100 Envelope Challenge

The 100 Envelope Saving Challenge provides a structured system to save over # 500,000 in 100 days. To begin, gather 100 envelopes and sequentially number them 1 through 100.

If envelopes are quite difficult to get, substitute using old papers , newspapers, ziplocs or large jars (to save the money). Just ensure, there is a tag from 1-100 and the money for each day is been deposited. The idea is make it like a game.

On day one, you’ll place 100 naira in envelope one. On day two, you’ll add 200 naira to envelope two, and so on. Place each envelope in a safe place, and by the end of the challenge, you’ll have saved 500,500 naira in 100 days.

If saving 500,500 naira in 100 days stretches your budget too far, try 50 naira or perhaps try filling only a couple of envelopes each week rather than one every day. While it will take longer, it still leads to consistent progress toward your savings goals.

You could make the amount lesser, if you are in countries like— United Kingdom, United States, Sweden, Canada where money has higher value. Ensure you do what works for you.

For instance, if you are in the states, on day one, place $1 in envelope one. On day two, add $2 to envelope two, and so on. by the end of the challenge, you’ll have saved $5,050.

Using this method, you’ll save very small amounts in the early days and larger amounts toward the end of the challenge. Starting with tasks that are extremely easy to accomplish helps you turn saving into a habit. By the time the amounts become more substantial, it will feel like less of a challenge. You could do higher amounts, but ensure you are consistent.

Alternatively, you could save the money directly in a savings account, when you pick the tagged paper, transfer the exact amount to the account. This allows you to avoid cash altogether, spending the funds and can help prevent potential risks associated with keeping a large amount of cash at home.

You may find it more effective to shuffle the envelopes and pick one each day. This will allow you to alternate between large and small amounts, which could be easier than trying to fill all of the large envelopes toward the end of the 100 days.

52-Week Money Challenge

The 52-week savings challenge is similar to the 100-envelope challenge, but it only requires a deposit once a week, spreading your savings out over an entire year. This challenge can help you ease into savings without making dramatic lifestyle cuts. It works by creating small habits that focus on consistency and incremental increases.

To start this challenge, use a savings account at the bank or set up a cash system at home, such as a large envelope, tote bag, box or a jar. During week one, you’ll deposit 100 naira. The next week, you’ll deposit 200 naira and deposit 300 naira the week after that. While these initial deposits are essentially just spare change, by the end, you’ll be depositing large amounts, ending with a deposit of 5,200 naira in the last week.

As I mentioned above, if you are in another country, ensure you use a figure you can stick with.

Using the 52-week savings method allows you to focus on making small, manageable deposits rather than focusing on an intimidating, far-off goal. The deposits add up; by week 30, you’ll have saved over 23,000 naira, and at the end of the challenge, you’ll have saved 137,800 naira.

There are several variations of this money-saving challenge, one of which may prove more appealing depending on your current financial situation. For example, if you are in the states and you receive a paycheck every two weeks, try creating a 26-week challenge, making deposits each payday. In this case, you’ll start with $3 on week one and increase each deposit by $3 increments. So, you’ll deposit $6 on week three, $9 on week five, $12 on week seven, and so on. At the end of this challenge, you’ll have saved $1,053. You can also create your own week challenge, choosing the frequency and increments that work best for you.

No-Spend Money Challenge

If you want to ramp up your savings but feel overwhelmed with budgeting, consider the simple – but effective – no-spend money challenge. As the name implies, this challenge involves completely stopping spending on unnecessary purchases for a set period of time — often an initial 30 days. During the challenge period, avoid any spending that is not essential for daily living. This means no spending on things such as takeout, lattes, or online shopping.

To get started, make a list of your absolutely necessary fixed living expenses, such as rent, electricity bills, and transportation. Then, factor in critical variable needs, like groceries and household items.

Once you’re satisfied with the list, make a commitment not to buy anything you haven't written down until the set time period has passed.

If going completely spend-free seems too dramatic to you, try limiting specific spending categories, like dining, entertainment, clothing, or hobbies. As an alternative, you can designate specific no-spend days. For example, maybe you commit to avoiding spending on Monday, Wednesday, and Friday or on the weekends. Giving yourself a bit of flexibility helps ease the adjustment. As you get used to thinking twice before spending, add additional restrictions to create even more savings opportunities.

If you prefer to watch savings grow in real time, make a transfer to a savings account each time you say “no” to a non-essential purchase. For example, if you usually spend 5000 naira on on takeout but decide to eat at home instead, transfer the 5000 naira to savings immediately.

Keep the Change Challenge

If you make a lot of cash transactions, a “keep the change” savings challenge might be appealing. To get started, set up a jar, piggy bank, or some other place to drop your change at the end of each day. 

Each time you pay for something in cash, hold onto the change and toss it into the jar as soon as you get home. In most cases, you won’t even notice a difference in your budget and may be surprised by how fast it can add up. As you work toward consciously minimizing the amount of small cash on hand, you’ll diminish temptations to spend it on unnecessary items. Count up the money in your savings jar every six or 12 months and take it to the bank. Watching your savings account balance grow from spare pocket change can be incredibly empowering.

You can also give your savings an initial boost by going on a “money hunt.” Clean out your office drawers, between the couch cushions, jacket pockets, car and the bottom of your purse. Stash any found cash in your jar.

Cancellation Challenge

Monthly subscriptions provide many forms of entertainment and conveniences but can also diminish your ability to save for the future. The cancellation challenge brings awareness to overlooked outflows and helps you uncover potentially significant savings opportunities.

Begin by carefully reviewing your bank statements for the past several months, noting subscription payments for services like video streaming, music platforms, software licenses, data subscriptions, and regularly delivered products. Then ruthlessly cancel anything you don’t need. Emphasis on ruthlessly!

Get rid of any subscription you don’t use regularly or that is not considered a household necessity. When you’re finished, total up the amount you’re no longer spending and set up an automatic savings transfer for the same amount instead. 

For example, assume you were able to cancel subscriptions for a 5000 naira for streaming, a 2500 naira service, and 6500 worth of products. Over the next year, you’ll be able to deposit 14,000 naira a month into a savings account – for an annual total of 168,000 naira!

Ladies and gents, whatever creative savings approach you choose, the key lies in making a commitment and sticking to it. As you make saving a priority, you’ll become more frugal. Seemingly small expenditures become more noticeable, and you’ll feel empowered, knowing that making small changes now can ultimately have a big impact on your future.

What do we say to the wheel of our finance — Out with the impulsive spending, in with the strategic saving mechanisms.

Monday Memo will be back, see you next week.

Omodolapo❤️