This Woman Put Away Over $40,000 with This Cheap Savings Hack

This article originally appeared on Readers Digest.

Saving money can be tough, especially if you’re one of many Americans who’s getting bled dry by this common spending mistake. Sudden expenses come up out of nowhere, and whether it’s an unexpected medical bill, a sudden repair needed for your car, or a sudden need to buy a luxury dog seat cover for said car, you just might have to wipe away all your progress. (If that’s the case, better read up on these habits of people who are great at saving money.)

But one college professor has come up with a genius trick which might just turn your savings woe into a savings “Woah! Look at all this money I have!” Marie Franklin simply takes every five dollar bill she encounters and puts it away.

In her blog post on the topic, Franklin explains that the simple trick helped her save “almost $40,000 since beginning the practice 13 years ago.” It all started when Franklin had to be a bit tighter with her cash when her daughters were going through college and opted to start sliding every Lincoln she encountered into a different pocket of her wallet.

Jo Kelly, the CMO of UBank, spoke to the New York Post about how this basic banking method could really simplify saving.

What makes it so achievable is the simplicity,” Kelly explains. “Anyone, anywhere can start building their savings using this trick. There’s no need to set up new accounts or develop complicated budgets—you can start with the money that is already in your wallet.”

So, for the retirement-fund challenged millennials, this may be a good reason to eschew Venmo for once and carry some cash.

Advertisements

Having fun sharing my story

I love to share my habit of saving $5 bills with people and I’m always amazed at how fascinated many people are by the habit.

There was the cashier at a local supermarket this summer who reacted like I had just handed her a winning lottery ticket the day I told her how much I’d saved putting away every $5 I got back in change. The woman all but stopped doing her job (bagging my groceries) as she listened to me ramble on about how I’d started when my daughters were in college and money was tight, to why I still do it today, to the fact that I’ve saved almost $40,000 since beginning the practice 13 years ago.

Then there were the two young professors who are my colleagues at a college outside Boston who showed so much enthusiasm for the idea that I gave them both a $5 bill last week at our back to school meetings (yup, they even do those in college, I’ve learned) to help jump start their practice.

These profs are dynamite individuals by the way, great at teaching their disciplines and loved by their students, but here’s the thing. Both admitted that while they love my idea and need to find a better way to save money themselves, that they may be hindered because they don’t use a lot of cash.

Yes, yes, and yes for emphasis. If you don’t use cash, this won’t work.

You may love the idea of saving your nest egg with $5 bills but unless you use cash on a regular basis for everyday purchases like groceries, food or coffee to go, even gas and other issues of commuting and transportation, it will be impossible to save a significant amount this way. Like I’ve said many times while writing my blog, you can’t get a $5 back as change if you pay with a debit or credit card. Only cash will do the trick. End of story.

So, if you like the idea, but haven’t started yet, and like many people I share the tip with, especially Millennials, have a mostly cashless existence, shake it up this week. Go to the ATM machine. Take out enough cash to cover the basic expenses you expect to face in the next seven days. Pay for as many things as you can in cash. Consume as you need, rather than simply buying out of habit. See how many $5s you get back in a week. If you like the number, repeat it into week two, then a third. At the end of the month, add it up.

Was it a good way to save a bit of money? Only you can decide. My hunch is, if you give it a try, you might get hooked. Because who doesn’t like to stash away a little money for a rainy day.

 

Yours in Fives,

 

Marie