cancel
Showing results for 
Search instead for 
Did you mean: 

Seeking to save $20,000 in one year

New Member

Seeking to save $20,000 in one year

Friends,

I am seeking to save $20,000 in one year. What is the best automated, daily way to accomplish this task? My greatest challenge with this in the past has always been reaching a minor milestone (i.e. $5,000) and then stopping the momentum. So the best solution for me would be one where it is fairly hard to get at the money (but not impossible) until the $20,000 goal is reached.

The purpose of this money would be for use as a 6 month emergency fund.

I make $47k per year, contribute to my 403b match, have no debt and own my home free and clear. I have one credit card (Discover IT) and my credit scores are all in the 700s at the moment.

Thank you in advance, Peter

Message 1 of 11
10 REPLIES
Regular Contributor

Re: Seeking to save $20,000 in one year

This may sound too simple but have you tried opening a free online-only savings account and then auto-transfer over what you can afford to save each time your paycheck is deposited into your primary checking account?

 

If all you see is what's left over (in your primary checking) you won't be spending it. Just don't log in to the savings account and transfer it back. Smiley Wink 

 

 

Message 2 of 11
Regular Contributor

Re: Seeking to save $20,000 in one year

Agree with Moneyklutz. $800 would do it if you are paid biweekly. ($20k/26 = $769.23) You will have to figure out how to live on what is left over from your usual paycheck, but it can be done. Just split it off and make it a point that you do not ever, ever touch that savings account. 

Ch7 discharged 10/2017. Pre-file FICOs high 400s.
11/2017 EX 609; EQ 634; TU 583
Message 3 of 11
Established Contributor

Re: Seeking to save $20,000 in one year

Open your savings account at a separate bank and split your direct deposit.

 

Don't get an ATM card for the new savings. Don't link it to any other accounts allowing online transfers to your checking. Literally make yourself go into the branch if you need to get the money out of it.

 

See what you can do to bring in additional money and sock it all away.

Ch 7 Discharge May 2015: EQ 588/TU 552/EX 570
Nov 2017: EQ 683/TU 660/EX 668 w/ 24% CC util reporting
Discover/Target/NFCU CLOC/NFCU Cash Rewards/PenFed Power Cash Rewards - $46k total revolving
Message 4 of 11
Member

Re: Seeking to save $20,000 in one year

hey that should be easy peasy for you. i am now well off but used to make 36k on a s#ity job and was able to save 25k easy each year. paid cash for both my house and car and continued to save(even easier after buying a house cos my housing expenses were minimal) until i reached another 100k in savings. in total i worked for 7 years(making about35k) and ended up with a paid of house, new paid off car and 100k in a bank.

i always read these stories about people making 65k or even 100k and struggling....i and i just dont get it.

it is very simple. make a budget and dont buy crap. especially dont buy crap on credit and pay intrest.

after i bought my house i literraly lived on 6k/year. so in your case save 20 easy and live like a king for 27k for just one year and you will have your 20k saved.

all this changes a little bit if you have kids or some other stuff but basic thing is the same. make a budget and stick to it. very simple.

Message 5 of 11
Valued Contributor

Re: Seeking to save $20,000 in one year

The more frequently you put money into savings, the faster interest accumulates.

 

I'd suggest doing part cash savings (high interest) and part savings with an app like StashInvest (especially if you can get 3 friends to sign-up using your link which will pay for 15 months of the app service).

 

Assuming you get 1.5% on savings and can get 7% on investments, you can save $20,000 in a year by putting $28 per day into savings and investment (daily).  In a year you'll be over $20,000.

 

Do note there are tax considerations for both so calculate that as well.

FICO8FICO8Visit my posts:
03/1712/17My 11 Rules to Credit RebuildingFree FICO Scores!
550EX
570TU
559EQ
710EX
701TU
734EQ
FICO alert: why did my credit score drop???
Message 6 of 11
Contributor

Re: Seeking to save $20,000 in one year

Invest in a drip fund. Allows regular deposits with no trading fees. Selling can take longer than traditional stocks, but not to long so you can have your money in a matter of weeks.

Message 7 of 11
Frequent Contributor

Re: Seeking to save $20,000 in one year


alexj wrote:

hey that should be easy peasy for you. i am now well off but used to make 36k on a s#ity job and was able to save 25k easy each year. paid cash for both my house and car and continued to save(even easier after buying a house cos my housing expenses were minimal) until i reached another 100k in savings. in total i worked for 7 years(making about35k) and ended up with a paid of house, new paid off car and 100k in a bank.

i always read these stories about people making 65k or even 100k and struggling....i and i just dont get it.

it is very simple. make a budget and dont buy crap. especially dont buy crap on credit and pay intrest.

after i bought my house i literraly lived on 6k/year. so in your case save 20 easy and live like a king for 27k for just one year and you will have your 20k saved.

all this changes a little bit if you have kids or some other stuff but basic thing is the same. make a budget and stick to it. very simple.

While I get your point and agree with ability to save, you can't really say you don't understand how people can't afford to live on $60k a year.... well it mostly has to do with the cost of living in your area.  There are many parts of the country where you could literally not even rent a shed if you are making only $35k a year, much less have money to buy a car and save.

 

$60k a year is nothing if median home prices are over half a million dollars.

 

As for the OP one great avenue I found for saving money is to use a service like Acorns.  You can set a weekly or monthly transfer and can even have it round up and deposit the "change" from purchases when you swipe your card.  You then set rules for your profile about risk and stuff like that but they basically invest the money for you in various ways depending on how you answer the questions.

 

Benefits of this is you will get a much better return than just having the money in a savings account, and also if you want the money back it takes usually over a week to get it because they sell of your investments blah blah then transfer you the money.  This means if there was an emergency you certainly could get the funds back, but it's not easy.  Also you don't have any type of card, or checks, or ATM access to that money so.... works for your "hard but not impossible" to get strategy.

 

BK 7 Scores (12/2016): EQ-528. TU-486. EX-530.
Current Scores (11/2017): EQ-671. TU-665. EX-669.
Goal for 2017: 650's. - made it!! next stop 680's. www.cartkingz.com
Message 8 of 11
Frequent Contributor

Re: Seeking to save $20,000 in one year

Send me your money and I'll hold it for you. J/K

Message 9 of 11
Member

Re: Seeking to save $20,000 in one year


enjoimorenow wrote:

While I get your point and agree with ability to save, you can't really say you don't understand how people can't afford to live on $60k a year.... well it mostly has to do with the cost of living in your area.  There are many parts of the country where you could literally not even rent a shed if you are making only $35k a year, much less have money to buy a car and save.

 

$60k a year is nothing if median home prices are over half a million dollars.

 

As for the OP one great avenue I found for saving money is to use a service like Acorns.  You can set a weekly or monthly transfer and can even have it round up and deposit the "change" from purchases when you swipe your card.  You then set rules for your profile about risk and stuff like that but they basically invest the money for you in various ways depending on how you answer the questions.

 

Benefits of this is you will get a much better return than just having the money in a savings account, and also if you want the money back it takes usually over a week to get it because they sell of your investments blah blah then transfer you the money.  This means if there was an emergency you certainly could get the funds back, but it's not easy.  Also you don't have any type of card, or checks, or ATM access to that money so.... works for your "hard but not impossible" to get strategy.

 

i agree that location is very important BUT in most cases it is only about housing cost(specificaly rent). even then you could rent a smallest studio for a 1 or 2 years and save 20, 40k or more, and then rent some nicer place.

Other then rent or a cost of a house almost eveything else is very close in price across the country. 

This person ownes their house free and clear so there is no reason to not be able to save this money. 

 

OP here is my idea. open a saving account with no online acces, no checks, no debit card. do not link it to any other acc. ask your employer if they can deposit part of your pay to this new account and the rest to your primary checking. in your case i would do 2k on each acc.

that way you will have no acces to that money unless you go to the bank and withdraw cash. 

and trust me you can live very comfortably with 2k a month.

 

Message 10 of 11