Reader Saves $425 By Saving Save Every $5 Bill

Brandon Savage writes that he’s having success with saving by taking the advice in our “Get Rich By Saving Every $5 Bill” post. Since starting in August, he’s got $425 in additional savings this way. Here’s how he does it:

Brandon says,

It’s really easy…if you have the willpower to put $5s in an envelope. At this rate I’d save about $2,500 a year.

It’s a real pain when you buy $4.50 in ice cream and get 3 $5′s back from the cashier. Or today when I got $20 cash back and the cashier gave me four $5s instead of a 20. Sometimes I’ll also supplement it at the end of a day by removing all bills smaller than $20 from my wallet.

The reality is that there’s a good chance I’ll blow $12 on lunch one day…so what’s wrong with “blowing” it on saving? I wouldn’t have missed it if I’d spent it at a restaurant, and I certainly don’t miss it being in an envelope or a hard-to-reach savings account.

Prior to it being deposited in ING, I have a special pocket in my wallet where I place folded-up fives. Then I transfer them to an envelope in my safe at home at the end of the day. Once I reach around $50 I deposit it at my bank and order a transfer by ING

With money, the old “out of sight, out of mind” concept works very well. At least for me. And it’s such a small amount that most people can do it without noticing it. We blow $5 on parking every day. Putting it in savings instead is easy.

I don’t use a whole lot of cash. So if you use more cash, you could end up saving more.

Congrats to Brandon. Have you tried this method? Do you have another unique way of tricking yourself into saving? Let us know in the comments.

PREVIOUSLY: Get Rich By Saving Every $5 Bill

Comments

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  1. When I was quitting smoking, every time I bought a pack I had to put $20 into savings. I didn’t save much but I stopped buying the smokes fairly quickly.

  2. Coder4Life says:

    uhh yeah maybe if you just put away like 10% of your paycheck each payperiod you could save a ton that way to..

    weird how you save when you save your money haha

    • mac-phisto says:

      @Coder4Life: ditto – i have 10% of my paycheck direct deposited into my ing acct. don’t even miss it b/c i don’t get to see it.

      only problem is, i tend to hit that up more often than i should, so i have another 5% going into a CU account i have had since i was 14 – i don’t have checks or a debit card or any other way to access that money (aside from getting in my car & driving 350 miles round-trip during the work week).

    • u2acro says:

      @Coder4Life: But maybe this person DOES already save 10% of his salary, automatically or otherwise. I certainly do (actually, 15% including the company match), but I’m always looking for ways like this to “trick” myself because I’m just awful with cash. Thus, if I have an extra dollar or five at the end of the day somehow, I immediately dump it into my jar o’ change and checks. Within a few weeks, that gets thrown into a savings account.

      I mean, really, who WOULDN’T like to save a little extra in a way that won’t hurt?

      • lordargent says:

        @u2acro: but I’m always looking for ways like this to “trick” myself because I’m just awful with cash

        Only people that are awful with cash need to trick themselves :D

        /not awful with cash
        /too smart to trick myself

        • u2acro says:

          @lordargent: I can be awful with cash, too. If I have $4 in my pocket, it tends to be spent on vending machine crap or ponytail holders. But that still doesn’t mean that this person ONLY saves $5 as a method of saving. That could very well be in addition to his stashing away a large percentage automatically into retirement and rainy day funds.

          This whole argument reminds me of the professor who refused to believe that some people weren’t book learners, that some people only really understood certain lessons when interacting directly with the professor and class. There’s no ONE way to do things, folks.

          Also, I resent your condescending implication that I or the OP aren’t smart.

  3. Princess Leela says:

    I’m not clear on how this would help you in the long run … I feel like I’d just run out of cash faster and need to go back to the ATM for more $20s that I’d eventually get back in change for $5s which I would put aside and then run out of cash again cause I’d put them aside.

    Maybe this is a total no-brainer, but I do do the “out of sight, out of mind” thing myself, except not with cash. I just have a recurring transfer set up in my online banking so every payday a certain amount is automatically transferred to my savings. And then I DON’T TOUCH IT.

  4. dmuth says:

    I tried the saving every $5 bill trick for a trip that I took last weekend. Over the course of 3 weeks, I saved up $165 in $5s. The day of my trip, I changed them in for $20s at the local bank instead of visiting the ATM. The money covered my expenses for that weekend.

    • Princess Leela says:

      @dmuth: Interesting, but do you know whether you actually spent less money than you otherwise would have, or did you just spend it in a different pattern?

  5. webwbr says:

    $427 is not evenly divisible by $5. Interest?

  6. Chu-Chu says:

    I find the title misleading as “Reader Saves $427 By Saving Save Every $5 Bill”. How do you save $7 by saving only $5 bills?? Maybe it should be changed to “Reader Saves $427 By Saving Save Every bill $5 Or Under”?

    Personally, I transfer $500 a month to my saving. Money there is only used for major purchases… such as, a new fridge…

  7. tedyc03 says:

    I can imagine that this would have a serious impact on one’s spending too…if you say to yourself “if I buy that $14.95 thing it really costs $20.00″ you might not buy that thing.

    And God forbid you buy something for $3.50 and get back 3 $5 bills!

  8. PercyChuggs Was Found At JFK Airport says:

    That’s a lot of $5 footlongs!

  9. jscott73 says:

    I rarely ever carry cash, $5 is usually my limit. I have automatic withdraw to my 401k with each paycheck plus automatic transfers to two different savings accounts each paycheck.

    Those automatic things are great but what has really helped me boost up my savings was my second job waiting tables I got about 6 weeks ago, I already have an extra $4200 in the bank in only 6 weeks thanks to that job.

  10. Angryrider says:

    Hmm…
    This is the same thing I read in a magazine when I was a child. Save .50 a day for 5 yrs or something, and you’ll get like $990 in savings by the time you’re done.

  11. katerrific says:

    I actually started doing this after reading that post and have loved it. I’ve probably only put away $75- $100, but it’s a cool psychological affirmation. I call it “embezzling from myself.”

  12. JN2 says:

    I don’t deal with much cash so this wouldn’t work well for me. . . . Now if I snag every $5 bill from my wife’s purse and stash it away it might amount to something!

  13. I’ve been doing this for a few months now and I’ve already saved almost $200. And I also do the automatic withdraw for 401K and Savings.

    When I have to break a $20 it does make me think if I really need something that is less than $5 knowing that if I do, I’ll have to put at least $5 of it away.

    I don’t think it’s so much of a savings mechanism as a way to make you stop and think about what you’re about to purchase.

  14. JimK says:

    I started this after that post as well. I printed out a pic of Lincoln and wrote “THE LINCOLN PROJECT” on a box. My wife thinks I’m crazy, but hey, anything to try to get some mad money saved up.

    I’ve saved maybe 85 to $100 or so. I don’t know exactly how much and I won’t be finding out for a long time. That box stays sealed up until I can’t fit any more bills into it.

  15. kidnextdoor says:

    I’ve been doing the same thing as OP, except I save all my $2 bills. I’ve been doing it for four years, and I’ve now saved $6.

  16. PhyllisCacharpa says:

    If you want to save cash, you could try what my co-workers does, she buys 2 dollar bills, she likes them so much she doesn’t want to spend them. She has saved a few hundred this way – She calls it her $2 Emergency fund

  17. mir777 says:

    Yeah this is fun! It keeps me a bit less free-spending, and I’ve piled up a couple of hundred bucks. Trying to decide how to apply it.

  18. jonworld says:

    I have been doing this sort of thing also ever since y’all ran that article about saving five dollar bills. Although my savings isn’t as great as the one reported, being 17 years old, it feels good having a money around for the upcoming turbulent times of college and afterwards.

  19. TPK says:

    Why don’t you just go to the ATM, pull out $425, stick it in an envelope, then not spend the time doing it every day for eight weeks?

    Maybe this whole idea should be retitled “How to Fool Yourself with Jedi Mind Tricks!”?

  20. TPK says:

    Of course, I know some people don’t have the $425 at the beginning. So just use some discipline, put aside $XX per week. Does it really help to play these games? Reminds me of people who set their clocks ahead by 5 minutes so they won’t be late. How can you “forget” that your clock is wrong?

    • rockergal says:

      @TPK:
      trust me it works!
      My clocks are 15 mins fast and I even did my car clock.
      You just glance at the clock and register the time. Same thing as when you change your clocks to daylight savings, you might know that your clock is “off” on hour for the first few days but then it becomes normal

    • u2acro says:

      @TPK: Yes, it totally helps to play these “games.” Not everyone’s brains work the same — a visual learner is different from an aural learner is different from a book learner. All of us have tricks for saving, even if we don’t recognize it as such.

      I don’t often carry cash, but when I do, I’m dangerous. Thus, if I’m going to a street fair or such, I’ll take out, say, $20 for fun. After the fair, I might come home with $9. I immediately dump that $9 into the jar o’ change and checks for later deposit into a savings account. It feels GOOD to see that little bit of money pile up, and it’s POSITIVE REENFORCEMENT because I did not spend that money! I figure I already took it out of my account once, so it’s already gone. Might as well “spend” it in a responsible way — savings.

    • u2acro says:

      @TPK: Oh, and I also set my clocks ahead. I might set the bedroom one 11 minutes fast, the bathroom one 16 minutes fast, and the microwave 7 minutes fast. I know that they’re all fast, but the uneven times keep me on my toes. Plus, Rockergal is right — you eventually forget for the most part.

  21. I’ve never really liked “gimmick” methods of savings. I suppose they work for some people, but I’d rather just use the Automatic Savings Plan through ING like I do right now.

    • u2acro says:

      @InfiniTrent: But this is what I don’t understand with this thread — why can’t you do both? Just as you might have a number of savings accounts, isn’t saving “extra” $5 bills, or quarters, or pennies in a jar or something just additional savings? Sure, it’s a smaller amount than that 10% automatic deduction, but some of us need to FEEL that cash slipping out of our hands and into a savings jar (later an account) to understand and be proud that we saved money instead of spent it.

      • freelunch says:

        @u2acro: I think the “gimmick” feel comes from the fact that the ‘savings’ are not really savings in the conventional sense.

        All you do with this method is cycle money through your wallet and back into the bank to retain an unpredictable amount of money. I find it more effective to monitor my spending habits month to month, set a ‘budget’ for daily spending, and save 25% of my income for investments and rainy days.

        Here is an easy approach to controlling your savings:
        1) Evaluate your living needs and determine how much you can set aside each month (10%, 15%, etc)
        2) Restrict yourself to no more than one ‘indulgence’ per month (new shoes, video game) and do not allow your normal spending+savings+indulgence to exceed your income level for the month.
        3) Limit yourself to one large purchase per year, where large purchases are defined as an item that will cause you to spend more money in a month than your earn for that month…. I use a 50% rule, where I will not touch 50% of my savings when shopping for my big item (such as a car).

        Hopefully this approach will encourage any normal person to weigh the benefit of any impulse buys if they can carry the mindset that they only get one impulse buy a month.

        • u2acro says:

          @freelunch: That’s great, but I’m not talking about indulgences. I’m talking about regular life stuff.

          I’ll use the example of a street fair, as I did in another post. If I’m going to a fair or wine taste fests or whatever, I generally take out a bit of cash, maybe $20 or so (Normally I hardly use cash, but you usually have to at these things. Also, let us assume that yes, I can, indeed, spare this $20.)

          Say I buy a couple of small plates that add up to $13. I thus have $7 left in my purse. I know that for myself, I’m probably not going to make a special trip to the ATM or credit union just to deposit that $7. However, I know that if I leave it in my purse, it will essentially evaporate into goodness knows what. Vending machine. Panera Bread. Pinball. A health smoothie. That additional “just one thing” I might get in addition to my regular grocery store trip. I’d much rather skip that temptation and throw it into the save-change-and-checks jar and deposit a giant pile of cash at the credit union once I see that jar fill up and I get all proud of myself.

          I should say that I’m not bad with spending. Once upon a time, I used to be, but that was years ago. My indulgences today are concerts, baseball games and random things at H&M. I build those into my mental budget, though, so they’re not an issue. In addition, I do contribute quite a hefty amount into various retirement accounts and have a superb company match. And again, I usually do not have cash on me. In fact, I rarely go to the ATM just to make it harder on myself (my credit union and nearest ATMs are an annoying drive away). But I do LOVE the feeling of saving the money that I didn’t fully spend. Yes, it technically gets recycled back into some savings or another. But that $7 leftover street fair money is $7 that I might have otherwise spent retardedly.

  22. DoubleEcho says:

    My wife does this, but in a weird Sopranos kind of way. She randomly puts $1 and $5 bills in various places in the house. For instance, there’s probably $20 in various bills in one drawer in the dining room hutch, $10 in her nightstand drawer, $25 in one of her dresser drawers, etc. Every time I go looking for a random paper or doohickey I find loose bills.

    I asked her once if she conciously put these there, and she said they just happen to get put there when she finds them in her pocket. One day, I swear to God I’m going to find stacks of $20 bills in an unused compost bin in the backyard.

  23. consumatron says:

    I’m up to $800 since July 25th. No tricks, really. Just pure will power. And I don’t ask for different change. If I get $15 back in fives, I don’t ask for a ten and a five instead. I take it and work around the rest of my daily purchases.

    Another thing I do, is at the end of every day, I change in all of the singles I might have in my wallet/pockets/backpack/couch cushions for crisp new fives (or put singles in multiples of fives into the special savings envelope).

    I have a separate high-interest online savings account where I keep my “fives” and have earned $2.66 in interest in just over two months.

    And, yes, this is a gimmick, but it is a gimmick I use in addition to putting away almost 1/4 of my paycheck each week into savings and investments.

  24. rockergal says:

    I have been doing this for years.
    I take out all my tens and twenty’s out of my wallet and leave myself with $20.00 for the week for gas, coffee etc.
    and I MAKE myself get by with that amount. I am amazed at how much money I used to blow at Dunkin Donuts or snacks at Turkey Hill. I saved up $3000 last year.

  25. DarkKnightShyamalan says:

    I think tricking yourself into saving is only going to go so far. Why not just come up with a monthly budget and carve out a portion for savings?

    • u2acro says:

      @DarkKnightShyamalan: Why not do both? Have your automatic savings/budget PLUS save the leftovers in a way that works for you. It’s not hard, really. In your budget, I’d imagine that you’d have a category for food/restaurants or entertainment/concerts/sports games. It also stands to reason that you might take out cash for some of those events. Thus, if you don’t blow your whole cash wad at a game or whatever, just put it in a jar until it adds up and you deposit it.

      • DarkKnightShyamalan says:

        @u2acro: I understand the principle, but money doesn’t really burn a hole in my pocket; if there’s leftover cash from a night out, it’ll get used for lunch or groceries or whatever. Then, if I have extra money at the end of the month, it goes into savings, and if I don’t have extra money at the end of the month it’s because I needed everything I had for my expenses, so it’s a good thing I didn’t save it prematurely.

  26. Triterion says:

    Who “blows $5 on parking every day”? I certainly don’t- that would be $1825.00 a year… You should have just called this post “How not to be an idiot throwing away money for nothing”

  27. YolandaSea urchin says:

    I LOVE THIS TRICK! I’ve been using it since early September and I’ve amassed a few hundred bucks. My elderly parents are using it too, they are on a fixed income and the extra money came in handy at the end of the month for gas. I told several girlfriends and they have started their funds and say it’s growing fast.

  28. Fry says:

    I monitor my accounts very closely (graduated accounting, though not working as one). Every payday, I leave $400 plus my upcoming monthly payments (at this point, that’s a $714.54 car payment and $22.60 pay-as-you-go phone payment) to last me until the next pay day (every two weeks). After a couple of of bigger purchases (about $2,000 total), I’ve saved almost $8,000 in 4 months.
    It’ll be a nice down payment on a house in 1-2 years…

  29. Scuba Steve says:

    I save by not spending. It’s a novel concept, sure, but it works for me.

  30. BryantRam says:

    I’ve been doing this since the original post but I’m not convinced that I’m actually ‘saving’ the money, because it seems to me that I just get more money out of the ATM when I’m down to my last $20 in cash — there’s no mechanism I’m employing to keep myself from withdrawing/spending more than xxx dollars per week.

    So I’ve just ended up with a HUGE wad of fives; if I put these back into a savings account, am I really saving them, or just sort of recycling them?

  31. 6a says:

    Line 6 of a W-4 says “Additional amount, if any, you want withheld from each paycheck.” Sure, the government gets to earn interest on it instead of me, but that little overlooked line is good for $1040 each year on my taxes.

  32. Kurt's Krap says:

    My new and so far working method of saving is this:

    Every time I need gas, I go to the ATM and use the fast cash option which gives you $60. I get $40 in gas and put the $20 away in an envelope. I save also by not paying the additional credit card fees at the gas station as well.

    It’s a willpower forced saving I suppose, but it is working.

  33. chauncy that billups says:

    I haven’t had cash on hand in like a year. So this won’t work for me.

  34. ConsumerKat says:

    During the year of my 21st birthday, every day that I had served (yeah yeah yeah, I was a waitress), I always put $5 away in my underwear drawer. Sure, I didn’t get any interest while I had it, but I also didn’t have the convenience of having it being able to overdraft into my checking account. By the time my 21st b-day rolled around in August, I had a nice hefty down payment for my Lasik Eye Surgery. Best thing I’ve ever done or saved for in my entire life.

    • trekwars2000 says:

      @ConsumerKat: Congrants on the savings method, but you might want to wait until you are a bit older to get the eye surgery as your eyes are still evolving until you’re about 30.

  35. meefer says:

    My goal is to save every other paycheck. Sounds loony, but I basically take the first paycheck each month and squirrel it into HSBC. The second I pay bills/food and the leftover amount is my fun money. It gets interesting at the end of the month (the dollar menu is my friend) but for the most part i get by.

  36. booboolee says:

    I budget out each month with my base salary (I work as a consultant and will be starting a night job soon) and automatically take out 30% for taxes (more than what I pay), and all my predictable non-optional expenses. Then, I give myself individual budgets in the following categories: groceries, clothing (building a new work wardrobe), entertainment (netflix, nights out), gas, and miscellaneous. I am saving $1500 a month just by recording everything I spend and if I run out of money in a category I stop spending for that category. Only sucks when that category is groceries since I don’t like to go without mah ice cream and cookies. Was saving up for LASIK, but I had an appendectomy instead. Oh wells.

  37. firestarsolo says:

    I have actually implemented this method of saving and have been using it since late August. I’ve saved up $115 so far!

    I haven’t had time to read the comments, but I need to mention this because IT IS ABSOLUTELY KEY.

    This plan works best when combined with a percentage-based savings plan with your income. Yeah, I’m talking about the “25% long-term, 25% short-term, 40% living-term expenses, 10% spending money” plan, or whatever plan you subscribe to.

    The trick is to only save the $5 bills that come from your SPENDING money. You end up saving all this extra money for investing/jet-skis/whatever THROUGH YOUR SPENDING MONEY.

    I’ve yet to find what to do with the extra money I’m accumulating, but I can guarantee that you’ll have an enjoyable willpower test when all you have is $5 bills and your friends invite you to go to Pizza Hut off-campus. . .

    • firestarsolo says:

      @firestarsolo: I need to add: this SHOULD NOT change your spending habits drastically. The point of the matter is to keep the same amount for spending money that you were using before, and so what ends up happening is that you have less spending money…this sucks, right? Wrong!

      What the $5 savings plan will do is force you to use your money intelligently – you won’t be so inclined to spend that $3 on a mochaccino when all you have is a $10 bill, because then you’ll be out $10! It has the ability, when implemented correctly, to lessen impulse spending.

    • u2acro says:

      @firestarsolo: Hallelujah! It’s about time someone else said that you can (and maybe should) have BOTH a regular savings method (retirement, rainy day, etc., preferably automatic) AND a trick or two that helps you refrain from spending extra cash. :)

      If you’ve already taken out cash to spend for X reason and you have some left over after X event, why not make yourself happy by putting the “extra” leftovers into the savings of your choosing?

      I seriously do not understand why people are simply responding with “Well *I* have a budget” and “*I* automatically have savings deducted from my paycheck.” That’s great, dude; I do too. But I also recognize that I need to see myself save my “extra” cash and be proud of it. It’s just an extra boost that can be worth hundreds in “found” money.

  38. YorkAntigone says:

    economics says: you don’t save Anything, unless you change your spending habits. This would only work if you didn’t have any check/debit/credit cards that you used. In the LONG run, you will spend the same amount. This is the same ideology of people who agree with the bailouts.. see the short term benefit, and don’t realize that the bubble continues to grow.

  39. dale3h says:

    When I found out about this method back when we first heard about it, I started doing it. I saved about $350 in 4 weeks. Sometimes I would purposely ask for $5s back so that I had to save them. My wallet has a bill separator which was perfect for separating my $5s from everything else.

  40. SuranjanaHizay says:

    I have been saving my coin change every day for a couple of years. When I get home from work, I empty the coins from my pockets and purse into a coffee tin. When the tin is full, I take it to the bank to change it for notes and treat myself to something I wouldn’t normally splurge on. I save between $100 and $200 a month doing this.

  41. Bruce Bayliss says:

    Just have bills and 2 quarters in your wallet. All the small change goes into a jar.

  42. zarex42 says:

    These gimmicks are silly, and often keep people from developing real habits that will truly benefit them in the future.

    • u2acro says:

      @zarex42: Um, for many of us, this “trick” doesn’t prevent us from “developing real habits that will truly benefit” us. Get off your high horse. Some of us do this IN ADDITION to regular and automatic savings. It’s “found” money to us, just like we might “find” a $1 or $5 bill on the street. Would you not pick that up?

  43. Murph1908 says:

    I agree with people approving these kind of methods in addition to standard savings plans.

    When I was right out of college, I had a system that helped me manage my spending, if not actually save. It was simple. If I had to break a $5 to buy something, I mentally considered that thing to cost $5. If I had to break a $10, that item would cost $10.

    Since it’s ‘easier’ to spend the little bills (I need a coke *insert George*), they can disappear quickly. The larger bills being unbroken take on more value. I would hold on to $20s for a good long time, never wanting to break them for something small.

    • u2acro says:

      @Murph1908: Amen! The little things DO add up. Yes, you need to take care of the big things (retirement, automatic savings, rainy day, emergency fund, etc.), but why not ALSO trick yourself to save the small bills that otherwise would be spent? Who doesn’t like “free” money? :)

  44. moore850 says:

    I’m not sure if in my lifetime I’ve handled 85 5-dollar bills ($425) total.

  45. katbur2 says:

    I don’t spend change, ever. So if the item I’m getting comes to $5.03 just means 97 cents into the bank. Then we deposit on a semi regular basis.

  46. wiggatron says:

    I NEVER use cash, so this wouldn’t help me much, although I do like the idea.

  47. Fist-o™ says:

    Interesting how different methods work for different people. I put all my change in a jar, but I don’t save any paper cash.

    I’m curious about the non-cash-users: Do you not use it because ATM’s are inconvenient? fear of theft? I guess I like to have some cash at all times because it makes me feel like a playa! haha.

  48. RandomHookup says:

    I realize I’m supposed to email an editor to correct the gaffe, but that headline makes my head hurt.

    Buffalo buffalo buffalo Buffalo buffalo.

  49. ThunderRoad says:

    I started the $5 thing back when the first suggestion appeared here. I really don’t “feel” the pain of it, but I noticed I was up to about $150.

    I don’t save too quickly since I most use my CC for point (and pay off every month) for almost every transaction, but it does add up.

    Another method I heard was that anytime you purchased something you didn’t need (dinner out, go to the movies, etc) you take and additional 10% of that and sock it away. Think of it as a self-tax on luxuries, where everything not needed to subsist is a luxury :)

  50. Hirayuki says:

    I started in July after reading about it here. I’ve saved $45. :(

  51. ganjagadget says:

    This has been working great for me! I have a small cash business on the side, which I use the proceeds for daily spending. So I pay cash for everything that I cant pay automatically through my checking account with cash. I don’t know how many fives are buried at the bottom of my change bowl but I have been putting in at least one every week day since the original post.