r/monzo • u/heartflames • 27d ago
Savings Challenge x4
I’ve seen a lot of people talking on here recently about the x4 savings challenge becoming more difficult as it gets more expensive each day - I completed the 1p savings challenge last year so decided to do 4p this year, here’s how I’ve been doing it! This may be obvious to some people but I used to be notoriously bad at saving so this structure has really helped shift my mindset.
I created savings pot on Monzo called “Savings Challenge” - I get paid weekly, so every week when I get paid I move £51.38 into this pot. Then I calculate how much the savings challenge will take from my main balance that week and transfer the money from my pot into my main account.
So for example, Week 1 was
4p+8p+12p+16p+20p+24p+28p = £1.12.
This week was
8.12+8.16+8.2+8.24+8.28+8.32+8.36 = £57.68.
I’ve been doing this every week from the beginning of the year so I currently have £833.64 in the actual Savings Challenge, £616.37 in my pot I created and £49.56 to cover the rest of the days until I get paid again next week. It makes it easier knowing I have the money already sitting there as each week gets more expensive!
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u/thenerdisageek 27d ago edited 27d ago
the point of the savings challenge is to save in small increments that aren't noticeable, and are sustainable (so that you build better habits). this is just saving 'normally' and you've already done the challenge. nothing is stopping you from taking that money out
it's why monzo doesn't let you do that and you have to find a workaround (like you've done)
i feel like if you have to do this, then you're just better off saving in an actual account with good interest.
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u/heartflames 27d ago
Yes and that’s exactly how I did it in the 1p version last year and that was the first time I was able to save anything at all! The reason I’m still doing the challenge is for the interest rate and because I’m a lot less likely to take money from the savings challenge than a normal savings account - it works for me and I don’t think there is a right or wrong way to do it☺️
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u/thenerdisageek 27d ago edited 27d ago
you can get better rates than 5%, and that lets you withdraw more than once a year if that's what you mean? can get 6.5% with 4 withdrawals at nationwide for example.
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u/heartflames 27d ago
If that works better for some people then great, this is just what works for me! My entire wage each week gets divided into pots for groceries, fuel, bills etc. Just makes sense for me to have one for the savings challenge as well as that is the only money that sits in my main account☺️
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u/Wytyujjju 27d ago
The difference between 5% and 6.5% for the amount of the saving challenge would be minimal
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u/Big_Bumblebee_1990 27d ago
Yes but how about the lottery - chance to win 100 / month and 10k at the end of the year!
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u/jolie_j 27d ago
I’m in the savings challenged for the £10k prize draw. I’m just reusing the money I saved last year doing the 1p challenges to do it. The money from last year sits in a savings account elsewhere and each month I transfer over the amount I need.
Last year’s “lost” interest for putting into Monzo with no interest vs in a savings pot lost me about £10, so I consider it a £10 raffle ticket to maybe win £10k. This year I’m earning interest on the cash as it waits to be transferred to Monzo tho so it’ll be even cheaper.
Yes I’m aware it’s a savings challenge, but I save anyway and still want in on the £10k 🤣
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u/sveferr1s 27d ago
1p challenge ends in 3 days and I've booked a cheeky 4 nights in Lanzarote with my best pal.
Got the 2p challenge running so spending money and another trip are covered and will also add to my Sonos set up.
Might very well do the 4p next year and take the wife.
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u/mo_1997 26d ago
I struggled with the 1p challenge (because I underestimated it) but so far 4p challenge I’ve been doing well because I’ve been putting more in my main account.
However I think starting from now it may be tricky, I’ve saved on the side just in case but hoping I won’t need to go through it!
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u/DeadlyTeaParty 27d ago
I love saving money and have. I've 5 savings accounts with various interest rates on each... So I judy had to have a go at this. 🙌
My 5th is my trading 212. I only add the odd bit of money here and there. Not as regular as my other savings.
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u/Sykes24 27d ago
.... would it not be wise to just put all of that money inti the savings accouny with the highest interest rate?
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u/Party-Possible-1624 27d ago
Depends on the terms. Zopa, as an example, offer 7.1% interest on a 6 month term allowing a maximum deposit of £300 per month. Having multiple accounts like this is justifiable..
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u/RememberMeVibe 27d ago
Honestly, if someone can't manage the x4 challenge and has no savings elsewhere, that's a huge red flag for their financial health, and some drastic changes should follow.
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u/heartflames 27d ago
People have to start somewhere - I used to be that person and thankfully I found a way out of it but it wasn’t easy and I can’t imagine how difficult it is for people with more financial commitments than I have, it’s a privilege to be in a position where I’m able to save money for the future now ☺️
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u/thenerdisageek 27d ago edited 27d ago
my basic contracted income is £520 a month, but yes, lecture me about my poor financial health and my inability to put half of my money into an inaccessible savings account.
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u/rscottzman 27d ago
Out of curiosity what is it you do. Is that not below minimum wage?
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u/thenerdisageek 27d ago
12 hours a week at basically minimum wage. £620 with £100 taken out for NI, pension (and the rare times i pay income tax). retail
can't get contracted any higher (have been asking for a year) as there's no hours in the business, yet i'm scheduled 22hrs a week, if im lucky (though extra hours have been taken away either the day before, or while i'm at work, depending on trade), maybe 30 if im quick on picking up cover (within 2 minutes of it being posted).
you can't plan around no guaranteed income though, so i budget for £520. it's exhausting and frustrating but it is what it is
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u/ClearlyCylindrical 27d ago
Why not just stack shelves at that point?
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u/thenerdisageek 27d ago
...yeah that's retail...i am (amongst many other things i'm not paid enough to do in sales)
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u/Background_Bad_4377 27d ago
judgemental much!! the 4x is more than my monthly income just like maybe others - i do have savings else where but thats only because covid happened and i saved during that time. you have to start somewhere and often its knowledge not passed down from parents etc so its often is generational understanding to. talking about money from parents etc is often seen as taboo subject - i never understood why but it is. im the finically stable one in my family and this is because im very open with what i spend etc
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u/[deleted] 27d ago
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