Valley First

Summer 2019 Savings Challenge (9 week plan)

Summer is just around the corner and it’s not just the numbers on the thermometer that are going up. For a lot of Canadians, summer is a season to be carefree and enjoy life and sometimes, that’s most true with their bank accounts.

June, July, August and September can be particularly expensive months of the year.

There are several reasons for this: people take time off and whether they’re vacationing or staycationing, they intend to enjoy life a bit more. Restaurant patios are open and poolside bars are just not an everyday experiences so we tend to indulge maybe a bit more.

Second, children are out of school and when they’re enrolled in daycare, summer camps and other activities, it’s hard to avoid the escalating child care costs.

Third, the warm weather itself often inspires us to spend more money either to enjoy it or simply to survive it. We spend more time in the car, in doors, out of the home. Thus our gas budget goes up, we use more electricity to keep the house cool, we eat out more…

But summer doesn’t have to be a season that melts our budgets. We can enjoy the sunny warm weather and save money at the same time. To help you do that, we’ve come up with a summer savings challenge that features a weekly activity designed to help you find small ways to save.

Do you want to escape the summer months feeling good about your savings?

Week 1: Set a savings goal

It’s hard to save for something abstract. Having a goal and naming it gives you the drive and focus that will help you succeed.

How much do you want to save, by when and for what purpose? Are you building an emergency fund? Do you want to save for a vacation? How about something practical, like school supplies at the end of August?

It doesn’t have to be anything fancy, but it helps to know what you’re saving for, how much you’re looking to save and when you want to save it by.

Week 2: Drink only water

Cut your soda, coffee, tea, milk, juice and alcohol and replace it with tap (or filtered) water.

British Columbians spend on average $864 per year on alcohol. Canadian coffee drinkers consume an average of 3.2 cups of coffee per day, with an average cup costing $4.22.

The amount we spend every year on drinks is significant, significant enough that cutting all drinks for a week could add a decent chunk of change to your savings.

It’s not just better for your wallet: it’s also better for the environment and for your health.

Week 3: No spend week

Also known as a zero spend challenge, a no-spend week is a great way to tighten your financial belt and train your self-discipline muscle. It’s as simple as it sounds: don’t buy anything for a week (make sure you’re properly stocked at the start of the challenge to set yourself up for success).

When you see something you want, or your favourite store’s got a great sale on, choose to wait until next time to get it. By then, you might realize that you didn’t actually want it that much and you’d rather see your savings grow.

This is a great way to practice delayed gratification and curb mini shops.

If you know how much you spend on average per day, reward yourself by adding that amount to your savings.

Week 4: Take advantage of cash back

Use a cash back credit card for your purchases and cash in on its benefits. Find out if there are retailers who’ll give you extra points.

Only be careful: on average, every year Canadians pay $750 in credit card interest fees but only get $350 in rewards. Make sure you pay off your credit card right away.

Week 5: Set up automatic transfers

By setting up automatic transfers, you put your savings on autopilot. There’s certainly something to say about the tactile experience of manually transferring money from your chequing account to your savings account. It reminds us of being children and putting our coins into our piggy bank.

But when you make your savings something that happens in the background regularly whether or not you think about it, you take your game to a whole new level.

Take your goal and divide it by the number of paycheques you’ll get. Set up an automatic transfer for that amount into your savings account with every paycheque.

For example: you want to save $500 by the end of August. You get paid every two weeks. There are 7 paycheques between now and then which means you’ll need to set aside $72 per paycheque to reach your goal.

Week 6: Save your spare change

A little savings every day can go a long way. A great way to experience that is to do a spare change challenge.

Pay using only cash and at the end of the day, save your spare change.

Rounding up apps have become a popular way to do the same thing while paying with your debit card. BIGChange is a feature available to our members that lets them do it without having to use a third party. You can also choose to add an additional $1-$5 and put your savings on hyperdrive.

Week 7: Tax your vices

Whether your vice is lattes, avocado toast, craft beer, cute shirts for your kids or something like smoking, cutting them out could easily save you $30 a week. Or you could tax them: every time you indulge, add $1-$5 to your savings. Just enough to feel it without breaking your budget. And who knows? Maybe this will help you kick some of those habits?

Week 8: Ditch unused subscriptions

Game of Thrones is over. Do you still need CraveTV? Are you using both Apple Music and Spotify? Is the cost of patience worth Amazon Prime?

Take an inventory of all your subscriptions from cable to meal delivery and gym memberships and put on pause the ones you use the least. Then take your list, and, next to each service, write the benefits you get from each. From there, weigh the benefits, circle the ones that matter most or that give you a better bang for your buck and see if you can whittle down your subscriptions by a couple more.

By cutting 2-3 services, you can easily end up with an extra $50 to add to your savings. If you end up missing them, you can always start them up again once you’ve achieved your goal.

Week 9: Waive the fee

Canadians spend on average $149 a year in account fees, not counting ATM fees, transfer fees, Interac e-Transfer fees, etc.

That’s great. If you’re a bank. Every year, Canadian banks record billions of dollars in profit. That’s your money working hard.

You don’t have to pay to bank anymore. These days, there are a lot of options for you to do everything you can do with your Big Bank chequing account without getting gouged by fees.

And banks have caught on! Recently, we've noticed that more and more banks are renaming their chequing accounts something like the Forever Unlimited Free Chequing Account, but still their fine print requires you to maintain a certain balance or have so many transactions or additional products with the bank. You can call a dog a cat, you're still charging people for a chequing account.

Our Simply Free Account is one of the best chequing accounts in Canada: you have no monthly fee, unlimited transactions and free Interac e-Transfers. The difference with the big banks is that we're a credit union: our profits go back to our members; a truly free chequing account is one of the ways we do that. Yes, we are bragging, but only because these truly free accounts with no strings attached are so rare, having one is worth bragging about.

Challenge Accepted

Summer doesn’t have to be stressful for your wallet. It can be a season where you enjoy life in the warm weather with everything it has to offer because you know that in the background, you’re still working to achieve your goals.

So get out there and enjoy the sun!

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