How to Save $10,000 in a Year

To save $10,000 in a year, you need to set goals for how much money to save per paycheck, evaluate your income, cut your expenses and automatically transfer the funds to savings.

Building savings is challenging. It requires strict discipline, an understanding of budgeting and the motivation to plan for the future. Whether you need to set aside savings for an emergency fund, start investing or save toward a large purchase, here’s your guide to how to save $10,000 in a year.

9 Steps to Save $10,000 in a Year

As you look for how to save $10K in a year, take it step by step to understand your goals, set realistic expectations and know what’s required to meet them.

1. Break it Down

You know what you need to save in a year. However, you should also evaluate how much you should save on each paycheck. Here’s a look at the monthly, biweekly, weekly and daily savings rates you should aim to set aside.

• Monthly: $833
• Biweekly: $385
• Weekly $192
• Daily $28

Depending on how often you get paid, you know how much of your paycheck to move to savings or your investment account immediately.

2. Evaluate Your Income

Your income might not support your area's $10,000 yearly savings rate. See if you need a raise, a new job, or a side hustle to make this a reality. A budgeting app can help you see your necessary expenses and the expenses you can and can’t cut.

3. Cut Unnecessary Expenses

You only make so much money. It’s easier to cut expenses than to increase income. Look for ways to eliminate unnecessary costs. Some ideas include the following.

• Eliminate cable television
• Take public transportation to reduce fuel and car maintenance expenses
• Prepare more meals at home and eat out less
• Review recurring subscriptions and reduce them to your most-used services
• Negotiate bills, such as your internet service

4. Say No to Debt

That couch you want will cost far more if you finance it or put it on your credit card when you don’t have the funds to pay for it now. Debt will eat away at your income quickly, making it much harder to meet your goals. 

Instead of buying the couch, except the used one that a friend or relative is getting rid of until you have the funds to buy the one you want outright. 

5. Give Up Impulse Buying

Don’t put yourself in a situation where you can buy something you don’t need or that you can wait to buy. If you aren’t someone who can shop without buying something, don’t go shopping unless you have a need. Go to the grocery store with a set list each week and don’t deviate from it. Avoid the snack aisle if you can’t keep yourself from tossing a little extra in the cart that you don’t necessarily need. Or have another household member do the grocery shopping who can be disciplined and only get a few fun foods instead of loading the cart.

Make large purchases after carefully evaluating your budget and meeting your savings goals for those items. If you need a new phone, don’t start testing other people’s new tech or ogling the phones at the store before you’re ready. This will make waiting harder and feel more like a penance than an exercise in financial discipline. 

6. Build a New Income Stream

Even with the best budget strategy and avoiding all frivolous spending, you might not have enough income to meet your $10,000 per year goal. Consider a new income stream through one of these side hustles.

• Freelancing services you are skilled at in your day job
• Mowing lawns or landscaping for neighbors throughout the summer
• Food delivery services
• Walking dogs or pet-sitting
• Selling old items you no longer use
• Selling baked goods
• Offering transportation or serving as a ride-share driver
• Monetizing a hobby
• Renting out your home when you aren’t there

7. Set Up Automatic Transfers

Saving is more effortless if you’ve never factored the money into your daily budget. You won’t have the money for a fun online purchase if it’s already protected in your savings account. Automatic transfers keep you honest toward your goals. 

8. Invest Your Savings

If your savings sit in a traditional savings account, they won’t accrue enough interest to keep pace with inflation, let alone grow beyond that. Choose wise investments that pay strong interest rates or dividends. Plenty of low-risk mutual funds and stocks will provide substantial returns with minimal risk of losing your principal investment. 

You could also look into a certificate of deposit (CD) or a high-yield savings account. These are safe ways to grow your money and achieve your goals.

9. Review Progress Toward Goals Regularly

Take time each month to cheer for your progress. This is a big savings goal; staying financially disciplined all year will be hard without feeling accomplished each month. Make sure to give yourself that time and be proud of how far you’ve come, even if you’re a little short of your goal one month. Know that you can make it up another month or extend your goal by one more month to make it happen. The key is being mindful of where your money is going and doing what you can to be smart about your financial future.

Meet Your Big Savings Goals

Whether you’re saving for a car or house or getting started with an investment account, putting back $10,000 a year will provide strong progress toward those goals. You might encounter some bumps along the way with unexpected expenses, changes in income, struggles with getting a side hustle going or other issues. The key is doing your best while enjoying life with little luxuries and fun activities. Don’t be so determined in your goals that you feel sad and depressed about your life here and now.