BudgetingPersonal Finance

How To Save $10k In A Year

Saving money will never go out of style. At best, you will have enough money to ensure that you enjoy a blissful retirement or make a down payment on the home of your dreams. At worst, you could end up with extra money that you have no use for. It is inconceivable, however, that having more money can be a problem for anyone.

When saving, it is indispensable to have a target in mind. Hence, you may want to consider saving 10,000 dollars. A timeline is also crucial, so setting the bar for one year is a goal you can work towards.

You should indeed set as a target only what you can accomplish. However, it would help if you did not get discouraged even before you get started. Regardless of your monthly income, it is possible to hit $10,000 in a year. In any case, if you need some motivation, you may want to keep your eyes on the extra cash you will be making.

If you’re looking to learn how to save $10K in a year, you’ve come to the right place. This guide will dive into the various steps to take to make $10,000 in a year. Most of the suggestions are commonsensical and practical. Ready to learn? Read on to start saving!

How To Save 10K in a Year

Saving 10K in a year sounds like a big leap, but it is completely possible. Below are some of the top steps you can follow to start saving so you can end up with $10,000 in your bank account by the end of the year.

How To Save 10k In A Year - Cash on Hand

Be Definite About Your Savings Goal

As you must have come to realize, the path to financial independence is economic savviness. One of the indicators of that is savings. Moreso, the first step to saving is crafting a savings goal. A savings goal serves as a roadmap. It tells you the target you wish to hit and, subsequently, how to achieve that feat. Thus, having a savings goal is an excellent personal finance habit to pick up and imbibe. Some may wish to save $1,000 in a few months, others may have a more physical goal like saving for a house. Deciding on your financial goal is one of the most essential steps to take.

Thankfully, at this point, you already have a savings goal in mind. However, looking to save 10,000 dollars in a year can seem like a tall order. This is especially the case for people who do not have so much money or have a lot of needs they spend their money on.

To make it a lot easier to navigate, breaking the colossal sum into bits is best. Hence, you can decide to get a monthly savings goal or even a weekly savings goal. Then, calculate how much you will need to save per month or week to hit 10,000 dollars before the year runs out.

Bear in mind that the earlier you started saving, the easier it will be to reach your goal. When you start on time, you will have less money to save as the months go by.

Open a Savings Account

If you do not have a bank account already, you will have to open one if you intend to save $10,000 in a year. There are several savings account options to explore, but the best is a savings account.

The chief attraction of a savings account is that you get to earn interest. This could even be a means to be making money periodically. With other bank account types, you get charged fees. You should not save money in a checking account. You will be losing instead of making more money.

More so, a savings account is further attractive because of the possibility of your money compounding over time. If the 10,000 dollars you want to save are geared towards your retirement, you will benefit from the compound interest a savings account affords you. As a loyal customer, you could even be eligible for bonuses not available to others. This is asides from the compound interest the account yields to you.

How To Save 10k In A Year - Open a Savings Account

Spend Less From Your Checking Account

You cannot aim to improve your savings if you spend too much on expenses. Thus, the goal of saving $10K in one year will remain a mirage, except you get some grip on your spending. You have to cut down on your expenses to be able to hit your savings target.

Granted, cutting down on how much you spend on living expenses can be quite a hassle, given the current realities. For example, a 2019 report shows that the average household spends $4, 400 on food. This is significantly high. In addition, most people have to pay utility bills, bear the cost of transportation, and several other monthly expenses.

However, cutting down on your spending is not tricky. It requires the development of good financial habits and discipline. Thus, the first thing to do is go through your expenses with a fine-tooth comb and eliminate all that isn’t essential. Then you may also want to reduce how often you pay for items with your debit card. Finally, you can designate some days to be your spend days. Outside of those days, you will not spend money.

Use a Savings App

For target saving, such as saving 10,000 dollars in a year, using savings apps is almost indispensable. A saving app primarily helps you to save money.

However, each one can have unique features. For instance, some help you create your monthly budget. Some automated systems make automatic deposits from your checking account to the app within a stated period. In addition, yet some others can also act as investing apps, helping you put your money into sustainable investment pathways.

How To Save 10k In A Year - Use a Savings App

Using a savings app will not disrupt your everyday life. If anything, it could make your life easy if you are interested in saving ten thousand dollars in a year.

Our preferred option is Acorns. This app is reliable, has an intuitive user interface, and can help you save $10,000 in a year with no hidden charges. However, there are others you may want to check out. You should make sure, however, that the app helps you hit your savings goal.

Pick Up a Side Hustle

Starting a side hustle is also one of the reliable ways to raise and save 10,000 dollars in a year. If you haven’t heard of side jobs or aren’t doing one already, you are missing out on so much.

A side hustle is a new job you take up in your free time. Ideally, it will involve anything you can do in your spare time, which will not affect your regular job. Hence, these jobs typically do not take so much from you but can get you started on your saving goals.

There are several side gig ideas around. First, you need to discover the one that suits your skillset. Hence, you could start a freelance writing gig. You could also take up Uber or Doordash driving on the weekends or in the evenings after work. More so, you can become a virtual assistant. Of course, for any of these, you have to carry out some research and test it out for a while to ascertain that you are a fit.

Starting a side job is great advice because it is a secure way to earn and save money without sweating too hard. As mentioned, you can use it to save 10,000 dollars in a year.

However, you can also put the money from your side jobs into your emergency fund (aka rainy day fund). This is because you would ostensibly be making enough money from your regular job. You could then put away the extra income to cater to emergencies.

Check the Monthly Bills

You may not even realize it,  but a considerable chunk of your monthly bills could come from subscriptions that you pay for. As long as you keep up with them, you will not have enough money to meet your savings goals.

Thus, split your subscription packages into two. The first group should contain those that drain your money without providing long-term happiness. For example, a gym membership could fall into this category. Just eliminate those.

The second category would include items like utility bills and the likes. It makes the most sense to keep up paying for these. However, you can choose to go for a lesser subscription package compatible with your financial goal or negotiate with the service provider. For instance, it is possible to speak with your cell phone provider to get a better deal than you currently have.

However, bear in mind that spending so much on these bills and hoping to save $10K at the same time will be a foolhardy decision.

How To Save 10k In A Year - Check the Monthly Bills

Start Investing

Financial success will not come simply from saving money. You will also have to start investing as soon as possible. Understand that the intention is not for you to hit your savings goals and to stop there. No, if that is your plan, then your financial goals are incomplete. Instead, incorporate investments into your personal finance ideology and watch the benefits come in waves.

Investing does not require much effort. There are so many investment options to consider. Investing in stocks is most likely the best for a newbie like you. However, you could also decide to go into real estate. Here, you will be investing for the long term. Real estate investing takes a few years to mature for you to reap the proceeds. Hence, if you started on time, say in your twenties, you would be reaping returns even late into your retirement.

It is also important to point out that you may want to employ the services of an expert while investing. This means that you would have to spend money. However, you should develop an abundance mindset. This sort of outlook lets you know that if you spent money on any worthwhile endeavor, there is the possibility of reaping it several times over. The key thing is to discover the right platforms to channel your funds into.

Pay Off Debts

You will not truly set off on your financial journey if you do not pay off your debts and loans. Imagine loans to be like an anchor; they hold you down even when you want to sail out into deep waters.

You will need to rank your debts in their order of priority. Thus, if your student loan debt is higher and requires more interest than your credit card debt, then you should tackle that first. Then, when you become debt-free, you will have more money to channel into your savings.

Pay Off Debts

Conclusion: Saving $10K in a Year

Saving 10,000 dollars may not necessarily guarantee financial freedom. However, it is a step in the right direction. When you are deliberate about improving your savings, you will be picking up other necessary financial skills simultaneously. Additionally, you would be curtailing wasteful spending and revamping your spending habits. In the long run, these skills will help you become a person of means. This conversation has shown you all you need to do to attain this impressive feat. It is now left for you to get to it!

Kevin

Kevin is an ambitious entrepreneur that is obsessed with all things related to finance. From a young age, Kevin has always been involved with side hustles ranging from online selling to freelance work. Over the years, Kevin graduated from side hustles and started launching multiple online and offline businesses. Kevin is a serial entrepreneur who loves starting new businesses and exploring all things related to business and finance. He is constantly looking for new ways to save money, invest money, and create income streams.