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When it comes to saving money, it often sounds like a lonely thing to do. You have to summon the enthusiasm, zeal, courage, and discipline to do it all by yourself. Along the way, you stop and can’t gather the strength to start again. I’ve been there and I know how you feel.
That is why you need friends when it comes to saving money and I call them friends with benefits. It is not an accountability group, neither are they your childhood friends or people you’ve known your whole life. Even though they could be, however, they are mainly people who have the same financial struggle, and goals, with similar aims as you, and within the same income range as you.
Who are these friends with benefits?
I know you are thinking something doesn’t make sense here. You are probably asking who these friends are and if you are just going to trust strangers. The answer is no. Friends with benefits are people you know and they are your colleagues, friends, people within your business circle, or even your family.
The next question you are probably asking is, why do I need them, or how should I go about it?
You need them for the same reason why you want to save money. We save money to pay off debt, make big purchases, have emergency funds, and get some financial stability. Hence, this method of saving will help you achieve your money goals faster.
This is something new to you and I am sure it is unique to your colleagues or soon-to-be friends with benefits too. So you have to share the initiative with them. Throw the idea to them and tell them how it works.
The entire concept behind this saving method
I have done this many times with my colleagues so I’ll tell you the idea and how it works from experience.
So I need to save money to make a big purchase in a particular month of the year. To be able to make that purchase I need to consistently save a certain amount of money unfailingly.
On my own, I might end up spending the money. So I make a commitment of giving that money out to 4 friends in the next 4 months to make their own purchases. Then they give it back to me when I need it.
The repetition of this will be for everyone in the circle and doing this with me. Still don’t get it? Don’t worry I will break it down in detail.
Here is how it works in detail…
The first step to take
Talk to four or five of your friends (colleagues, friends, or business circle) about a saving hack or method that has to do with contributing money towards helping one another save money, make big purchases, have an emergency fund, reduce debt or make an investment. Once you get their attention, then break down how it works.
Some easy rules to guide you
First I will start with some rules you have to work with if you want to be successful
- Must be your colleagues, friend, or people in your business circle
- Your income range should be the same
- Keep the number of people in the circle small. At most six people and at least 3 people.
- Must agree on a fixed amount of money to save.
Next steps to take
Now that you’ve gotten their attention, let them know that what you guys plan to do will run in months according to your number.
For instance, you are 5 in number including you which means you will be working with 5 months of helping each other save money. If you are starting in February it will run through June.
The next thing is to agree on a fixed amount you are all comfortable saving. Remember it is important for your pay range to be the same.
For instance, you all earn between $1740 to $2604. This means saving $200 for 5 months in a stretch could be possible. Within 5 months you’ve helped each other save, make a purchase, reduce debt, or have an emergency fund of $1000.
The figures I am giving here, are assumptions. You and your friends with benefits could earn more or less. Hence, decide to save more or less. Make sure you save an amount good enough to solve a problem.
The saving works like a contribution to one another
You have all agreed to a comfortable amount of money, and then you all pick a month to work with.
You guys are A, B, C, D, and E. The months are February, March, April, May, and June.
You can do a draw with the months to make it fair or choose months individually where you need the money the most.
You must all agree and work together in achieving this.
Using the draw method
A picked June
B picked February
C picked May
D picked March
E picked April
If you pick the month of May( this means you are C), it means you get $200 each from your friends plus your own $200 making it $1000.
In February: A, C, D, and E save $200 with B.
In March: A, B, C, and E save $200 with D.
In April: A, B, C, and D save $200 with E.
In May: A, B, D, and E save $200 with C.
In June: B, C, D, and E save $200 with A
This simply means in every month one person gets $200 from four other individuals. You keep going until the last month and till everyone gets back what they saved.
How do we track it?
You probably have issues trusting people with money and you want to be sure this saving method is safe. I get you and I will answer your question.
It is simple to track the money you are giving out and have your record. Make sure you sign a check or make a bank deposit for each contribution. With this, you will have records of your transaction with receipts.
Why this saving method never fails
- You do it with people you know. People with the same pay grade, financial struggle, and goals (friends and colleagues)
- Once, you start it is a commitment you can’t back out of. So you become money disciplined and conscious of your expenditure.
- It helps you achieve some money goals faster than you thought you could.
- You don’t feel alone in your financial journey. The awareness of this alone makes you focus
- It is not a one-time thing. You can do it over and over. I did it last year it helped me get a new P.C. without credit and helped me clear one area of debt. We are doing it again this year.
In Conclusion, give it a try
Aside from the fact that the friends-with-benefit saving method is practical, easy to do, and a fast way to keep away a good amount of money, make a big purchase, pay off some debt, and have an emergency fund. You must agree, that on your own you won’t record this much success in saving money this much and fast.