The simple money-saving challenge involves a saver increasing the amount they save each day by one penny. This means they start with 1p on the first day of the year, increasing to 2p on the second day and so on.
This means on the final day of a non-leap year, a person will have to save £3.65. They will accrue total savings of £667.95 over the year.
The money can be collected in a pot so a person can see their savings totting up, or be moved over into a savings account online.
A person can take on the challenge on New Year’s Day, or take it up later in the month, by transferring the total so far.
For example, if a person started the challenge on January 5, they would need to start with 15p and then carry on with 6p the next day.
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Savers also have the option to do the challenge in reverse, starting with £3.65 on day one and decreasing the amount by 1p each day.
Molly Mileham-Chappell, from MoneySavingExpert, said previously of the 1p savings challenge: “Part of the fun is that the challenge can take a fair bit of discipline.
“Even if you don’t stick to it to a tee, what’s really important here is that you’re thinking about saving and trying to set some money aside.
“You can make the challenge work for you – if you don’t use cash often, see if you can set the money aside using your online banking and vice versa. But remember, it’s usually best to pay off debts before you begin to save.”
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Another popular option for people keen to save even more money in 2023 is the £5 savings challenge.
For this challenge, a person starts by saving £5 a week, and then adding another £5 to their savings for the next week, increasing to £10, and so on.
This is a more difficult feat to keep up, by week 26, a saver will have to move across £260 into their dedicated savings account.
But the challenge also offers big savings that could go towards a person’s future needs, as by the half way point they will have saved £1,755 in total.
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By the final week of the year, a person will be challenged to save £260 into their savings account.
The total savings a person would get over the year would be £6,890, which could be a major help towards the following year’s costs.
Regularly putting money into a savings account also has the advantage that the money will be boosted by an interest rate.
This could add a small amount of cash to the balance that has been put aside. Interest is often calculated daily for savings accounts and may be added to the balance monthly or yearly.
There is also the option to save the money in loose change or notes, but this will not get the security of a bank or building society account.
Another budgeting method is the 50/30/20 rule. This involves dividing a person or family’s after-tax income, with 50 percent going towards basic needs, 30 percent towards wants that are not essential, and 20 percent for savings, investments or reducing debts.
Britons will be keeping a close eye on their finances this coming year as the cost of living is set to continue to increase.
Average energy bills will increase to £3,000 a year from March, when the Energy Price Guarantee cap increases.
Mortgage repayments are also set to increase as the Bank of England is expected to continue increasing the base interest rate, in efforts to tackle soaring inflation.