When I first started my personal finance blog oh so many years ago, it was called A Dollar A Day. I had decided to do a money challenge and spend all of 2008 putting away a single dollar every day. I put it into a high yield savings account (back in those days, the rates were pretty darn good). It was pretty exciting to watch the money add up and see all the interest I was earning. By the end of the year, I had $371.22. (Oh, how I miss those interest rates.)
At the end of the year, I took all of that money and invested it. I did a bit of research and picked a stop. I am a fan of the "set it and forget it" style of investing, so my money's been riding in investments since then.
The current value?
I actually hadn't done the math on this specific investment until today (I tend to look at my portfolio as a whole) and well, I'm pretty impressed. By saving a dollar a day for a single year, then investing, I've more than tripled my money. Of course, this is growth over more than 7 years. And some of that has to do with the stock I picked. (No, I'm not going to reveal that - not because it's some secret but because I'm not a financial advisor and I don't want someone telling me that I picked a terrible stock for them.) I'm sure some stocks have grown significantly more, others have most certainly tanked.
I only did my dollar a day project for one year. But if I had continued and continued to invest at the end of the year, I can't help but think about what my investments would look like now. Even if I hadn't invested, even if I had just put cash into a jar and stored it in a cabinet, I would have $3288 in that very overstuffed jar by the end of the year.
That's a pretty big number to look at.
Of course, who's to say that I would have actually saved all of that money. Maybe at the end of the year, I would have chosen to spend it on something. I have made some pretty big purchases since 2008, most notably my house. That $3200 would also have made a nice dent in my car payments.
So maybe it's time to start up the "Dollar a Day" project again, and maybe this year, you'll join me. Setting aside a dollar every day is a pretty easy task. And you can do it however works best for you. Maybe you put a dollar bill into a jar every day. Maybe you do it weekly. Maybe you're not a cash person, so at the end of every month, you transfer $28-$31 into a special savings account. However you do it, set aside that dollar, and think about how you will use that $365 at the end of the year. Sure, maybe $365 doesn't seem like much, but when saving it is essentially painless, how can you turn down the opportunity?
What should you do with the money at the end of the year? That's up to you! You can invest it. You can use it to pay down debt. You can use it in December to pay for Christmas presents. You can add it to your emergency fund. You can splurge and buy that thing you didn't get for Christmas. Whatever you think is the best use of the money is the best use of the money.
Try it. Save a dollar a day. Maybe by mid-year, you'll find that saving $1 is so painless that you want to try to up it to $2. Maybe you have a tight month where you can only save $1 on half of the days. That's okay too. Make this project work for you.