Do you want to save money but need some sort of challenge to actually make it happen? And you need a savings challenge that is realistic for lower budgets because you don’t have 10k sloshing around in your account. The 50 envelope challenge is the answer.
Save money every week for 50 weeks (you can have a 2 week savings vacation) and you will have $1,275 saved by the end of the year.
When you don’t have a money tree to hand, putting money aside every week can feel extremely difficult. Because there are so many other things you need or want to buy.
Getting into the habit of regular money saving is a good thing to do though as those extra funds can make like a lot more easy and enjoyable.
Saving money does not need to be hard or complicated, sometimes the simpliest things are the best. Get back to basics with cash and a system that is so easy to set up and use.
Simple = Successful
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Why should i do the 50 envelope challenge?
The 50 envelope challenge is an exercise that helps you save money easily over a year. Many people have said it helped them save up their first emergency fund or pay for a vaction. It helps you see the impact of your savings on a weekly basis as your stuffed envelope pile grows.
There are several reasons why completing the 50 envelope money saver is a great idea:
- It helps you get organized and saves you money.
- It can help you build your emergency fund (very important).
- It teaches you how to live within your means.
how much money do you get from the envelope challenge?
If you follow the original 50 day money saving envelope challenge and successfully complete it then you will save $1275 in 50 weeks. Now that could be a stretch for you but if you achieve it, wow! You’ve just saved enough for a vacation or a decent start to your emergency savings fund. What a great achievement that is.
tools needed to organize your money saving envelope system
To be successful with your envelope savings plan there are a few supplies you’re going to need. Nothing fancy but being organized makes any challenges easier and making it colorful and arty makes it more of a pleasure.
- White envelopes – for your cash!
- Color markers (fun) or black marker – to number each envelope
- Cash! – unless you are doing the digital version (see below)
- Container – a box or container the right size to hold your envelopes makes the whole process a little more special and fun
downsides to the envelope savings system
It can also be difficult to stick to if you have a lot of expenses or if you like to spend money on things like food and entertainment with never any money left over at the end of the month.
You cannot earn interest on the money in the envelopes so you’re effectively losing a little money each day. Although interest rates are pretty low so you won’t be losing much! And finally, it’s a lot of dosh to be stuffing into envelopes and leaving around the house for a whole year.
Who shouldn’t do the envelope savings challenge?
Some people may be better off not doing this weekly envelope challenge. Challenges are difficult for those who struggle with saving money and rely on their credit cards to get through a whole month.
It might not a huge amount to save but if you are currently living beyond your means, it’s going to be a big change to swap to living below your means for an entire year.
It can also be overwhelming for you if you are struggling to manage your finances. You need to be able to budget and learn how to save money using envelopes every week for a whole year.
If you don’t get paid in cash then challenges are that much harder as they will require regular withdrawals of money in order to fill your envelopes.
For lots of ideas on alternative challenges that you can do check out these posts:
the 50 money envelopes challenge math expained
It sounds simple enough, 50 envelopes numbered 1-50 and you fill one each week. You can choose which way to organize and pick your envelopes and the following will help you decide.
You need to take a little time to do the math to make sure the 50 envelope challenge total in any given month is practical given your overall budget.
Examples of the 1-50 envelope challenge total that can happen:
- Week 1 – you pull envelope number 1 = $1 saved
- Week 2 – you pull envelope number 2 = $2 saved
- Week 3 – you pull envelope number 3 = $3 saved
In 3 weeks your total saved is $6 – easy peasy you might think. But what happens when you pull the following envelopes instead?
- Week 48 – you pull envelope number 48 = $48 saved
- Week 49 – you pull envelope number 49 = $49 saved
- Week 50 – you pull envelop number 50 = $50 saved
In 3 days you are now trying to stuff $147 into envelopes. This could be painful! Especially if it’s in the weeks leading up to Christmas.
If your budget would not stretch to this kind of money saving on a monthly basis then chose a variation from below or make up your own.
You could reverse your 50 envelope challenge by starting with envelope number 50 and work downwards to envelope number 1. E.g. week 1 = 50 saved. week 2 = 40 saved until week 50 when you save just $1.
Or you could shuffle the envelopes so that you pick them randomly and take your chances with your numbered envelopes to save money.
Alternatively you could stretch the 50 envelope challenge to 2 years instead. Pull one envelope every other week. Your money, your choices.
how you can do the envelope saving method digitally
Follow this cash envelope saving system of having numbered envelopes and picking one each week. You need to have or set up a separate savings account that is ring fenced for this envelope trick to save money.
Instead of filling each envelope with the money required, have a separate bank account that you will transfer money into digitally.
For example, if the envelope you have picked is no.49 then instead of putting $49 of dosh into the envelope, transfer $49 into your savings account. Do the same each week, transfering money digitally instead of stuffing wads of dough into envelopes at home.
The plus side to doing a digital challenge is there is no need to find an ATM and withdraw funds on a regular basis. It also means you won’t have up to $1275 hanging around the house as you near the end of the challenge.
How does the 50 envelope saving challenge work?
This all sounds very simple and it is! This weekly envelope savings challenge is simply one envelope a week for 50 weeks. It’s perfect for people on a low income or with high outgoings. You have to be honest with yourself about what your budget is and your ability to save money consistently every week. But the amount is not sky high so I am betting you will succeed.
If you want to take part in the 50 envelope challenge, the first step is to get yourself 50 envelopes. Then you need to mark your envelopes in order to start saving. Number them from 1-50. Then choose how you will pull each envelope. You can:
- Start with the lowest number envelope and work your way up each week. E.g. Week one = 1, week 2 = 2 and so on. Or,
- Start with the highest number envelope and work your way down each week. E.g. Week 1 = 50, week 2 = 49 and so on.
- Shuffle your envelopes and pull one randomly each week.
To start your money envelopes challenge you pick an envelope using one of the methods above and put the amount of money from that envelope inside it and stash it away somewhere safe. E.g. if you pick envelope number 37 then place $37 inside.
This challenge works by picking an envelope every week for 50 weeks (you can have a 2 week challenge vacation!) until you have picked all the envelopes. When you successfully do this you will have saved $1275.
50 envelope challenge variations
You can of course vary this weekly envelope money challenge to suit your savings goal. Maybe you want to save $1000 or $5000 or even $10,000. You can save money however you want to. Here’s a few variations to consider:
50 envelope challenge for tight budgets
If you are living on a tight budget and have little spare cash then the idea of saving $1275 in a year might feel too much initially.
That’s doesn’t mean you can’t be saving money using the envelope method. You just need to find or create one that fits your individual circumstances. Not too easy but not beyond difficult.
After all, if you’re on a low income you might not even have $100 a month after paying your essential bills.
- You could have envelopes numbers 0.5 – 50.
- Or envelopes numbers 1-10 and 5 sets of them. i.e. you have 5 envelopes numbered 1, 5 of them numbered 2 and so on.
- You could even have some envelopes numbered 0 to give yourself a random day off!
Choose the best money envelope ideas that are going to work for your finances then create 50 envelopes with numbers that add up to your savings goal total. Whether it’s $500, $750 or $1000 or something else.
Paycheck envelope challenge
If you only get paid once a month it might seem strange to put dollars into an envelope every week. You can still be saving money using envelopes but do so according to how often you get paid.
Paid biweekly? You could use 50 envelopes and fill 2 of them every time you get your paycheck so you still complete the challenge in a year. Or you could fill one every paycheck and take 2 years to complete your goal. Perfect if money is tight. Alternatively find the perfect biweekly money saving challenge here.
Paid monthly? You could fill 4 envelopes every time you are paid. But this will only fill 48 of them. So in 2 separate months you would need to fill 5 envelopes. Best to choose those envelopes wisely if you are working this variation.
how to save 5k in a year with envelopes
If you want to save 5k in a year with envelopes then you can. Saving 5k is a much bigger number so your 50 envelopes will need to reflect the bigger goal. The easiest way to save $5000 this way is to number all your envelopes the same. 50 envelopes with $100 will do it.
Alternatively you could vary the amounts on the envelope, you just need to ensure they add up to the $5k total you are aiming for. If you want to save $10,000 in a year then your envelopes will all be numbered $200 or be random but total the $10k goal.
money Tips to help you complete the 50 envelope challenge
The key to being successful with this challenge is to get your finances in good shape. Make sure you have set a budget that will allow for regular, random savings. You may also want to consider the following tips:
- Make your own coffee
- Cut cable TV
- Change your cell phone plan
- Keep utility bills down (negotiate or change provider)
- Use less energy by doing things like turning lights off and lowering your thermostat
- Eat out less
- Meal plan
- Buy generic brands to reduce your grocery bill
- Drink more water
- Shop around for your insurances (don’t auto renew)
what’s the difference between the 50 envelope challenge and the 100 envelope money challenge?
The difference between the 50 envelope challenge and doing it over a year is exactly that. It’s the length of time the challenge runs for. Plus of course you save less money so you can succeed even on a tight budget.
You save a nice lump sum of $1275 in a year rather than $5040 in 100 envelopes to save money in just 100 days. 50 weeks versus 100 days. The principle of saving into envelopes is still the same. Just the amount and time-frame are different.
TikTok cash savings goal
If you love seeing what other people do then check out the views on this tiktok video. There are plenty of TikTokers who record their challenge progress and it’s fun to see what they say and how they are doing.
saving money with envelopes FAQs
How does the $100 envelope Challenge work?
The $100 envelope challenge works by putting your dough in a numbered envelope every day for 100 days until you fill them all. First get yourself 100 envelopes. On each envelope, write a number from 1-100.
Pick an envelope at random and put the amount of money from that envelope inside of it and stash it away somewhere safe. E.g. if you pick envelope number 37 then place $37 inside. When you successfully fill all the envelopes you will have saved $5,050.
For much more help and detail check out my post on the 100 envelope challenge.
How much do you save with the 200 envelope challenge?
The 200 envelope challenge is a way to save $5,000 over the course of 200 days. Based on the popular 100 day money saving challenge but made easier for those of us who can’t stump up $5000 in just 100 days. With the 200 day envelope challenge you save money into an envelope every day for 200 days resulting in $5100 saved.
how can i save 10k in 6 months?
To save 10k in 6 months requires a big commitment and a good income. You also need low outgoings to enable you to find enough dollars from every paycheck to hit your goal of saving 10k in 6 months. This is how much you need to save to reach your target:
- Per week you need to save $384.16
- Bi-weekly it will be $769.23
- Monthly you need to save $1666.66
Check out my post on how to save 10,000 in 6 months for help with this goal.
How can i save 10k in 3 months?
To save 10k in 3 months you are going to need a very big income and very low outgoings. And a willingness to not spend anything like what you normally spend – presuming you are not currently saving 10k every 3 months. This is how much you need to save to reach your target of 10k:
- Per week you need to save $769.23
- Bi-weekly it will be $1,538.46
- Monthly you need to save $3,333.33
How can i save 5000 a year with envelopes?
You can vary the traditional 100 envelope challenge to hit your $5000 in a year money challenge. Keep the 100 envelopes but pick just 2 a week instead of one every day. In 50 weeks you will have saved $5040.
how can i save $5000 in 3 months with 100 envelopes?
You can save $5000 in 3 months with 100 envelopes by following the original 100 envelope savings challenge. You number each envelope 1-100 then fill one each day. The challenge works by picking an envelope at random every day for 100 days until you fill all the envelopes. When you successfully do this you will have saved $5,040.
How much money is the 50 envelope challenge?
The traditional 50 envelope challenge would result in you saving $1275 in 50 weeks. But, you can make your challenge different, more suited to your financial goals and your budget. You could have every envelope marked with the same number. E.g. 10. This would mean you would save $500 (50 x $10). Or 50 in which case you would end up saving $2,500 (50 x $50).
If you get a biweekly paycheck then your money will work best when you budget biweekly and save the same way. That’s why I’ve created a biweekly money saving challenge just for you. In fact I create 5 of them – we all like a bit of choice don’t we?
Final thoughts on how to save money using the envelope system
As you can see saving money using the envelope system can be very easy indeed. Plus you are restricted to only saving $1,275 or only using 50 envelopes.
You can save whatever you want to, using however many envelopes you want to. You can even go digital and never stuff a single dollar into an envelope!
Start taking back control of your money by grabbing your copy of the Money Saving Starter Guide today.
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Last Updated on 5th April 2022 by Emma