If a check writer doesn’t want the payee to be able to cash it immediately, they may choose to “postdate” it: On the date line they will simply write in a future date. This can be helpful if someone needs to deliver a check before they have the funds necessary for the check to clear in their account.
What is a postdated check? Keep reading to learn more about how this payment process works.
What Is a Postdated Check?
What does it mean to postdate a check? When someone writes a postdated check, they write a future date on the check instead of the date the check was actually written. A payer might do this so a check can’t be deposited until that later date (when they’ll have the funds available in their bank account). This can come in handy when someone wants to mail a check to pay a bill before the due date, but knows their paycheck won’t be deposited into their account until a later date.
Writing a postdated check involves the same process as writing a normal check, except the current date isn’t used.
Are Postdated Checks Legal?
Usually, postdated checks are legal in the U.S., but it’s worth verifying the rules in the state where the check writer lives. Note that these guidelines may not cover cashier’s checks or traveler’s checks, which have their own rules and limitations.
Word to the wise: Postdating is sometimes used for fraudulent purposes, so think twice before agreeing to accept a postdated check, especially from someone you don’t know well.
Generally, the payee has to wait to cash a postdated check until the date specified on the check arrives. That being said, some financial institutions may cash a check prior to that date.
If a payer wants to guarantee that a check won’t be cashed until a certain date, they can make a formal post-dating request with their bank. The bank may charge a fee to do this.
Even if a bank or credit union is willing to cash a postdated check before the date written on the check, the payee may be better off waiting to cash it. The odds are that the payer added a postdate because at the time they didn’t have the funds available in their account to cover the check.
If the payee cashes it too soon, the check may bounce and cause problems for both parties. If the payee is eager to cash the check earlier, they may want to consult the payer on whether or not it’s safe to do so.
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Alternatives to Postdated Checks
Check writers who want to buy some time until a deposit to their account clears have other options besides postdated checks.
Online and Automatic Bill Payments
One option for making future payments without having to postdate a check is to go digital: The payer can go online to schedule a bill to be paid on the exact date of their choosing. As a bonus, there’s no need to order checks or manage a checkbook with this payment method.
At your request, some businesses — including mortgage, utility, and credit card companies — can change the due date of your monthly bill to one of your choosing. For instance, if you get paid on the first of the month, you can request that the due date of your rent or mortgage payment always be 3 days later. That way, you can set up automated bill pay without worrying about your transaction clearing.
Payment Plans
Before you consider postdating a check to avoid overdrawing your checking account, ask if the business will offer you a payment plan. Some companies will allow individuals to make smaller, incremental payments over time rather than one big payment. Make sure to find out first if the payment plan involves a fee or interest.
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FAQ
Is postdating a check illegal?
No, it’s generally not illegal to postdate a check. That said, it’s a good idea to learn about the laws governing postdating checks in your area. Postdating a check can be considered a crime if the payer’s account does not have the required funds to process the check and if they intended to defraud the payee when they issued the postdated check.
Can you deposit a postdated check?
Some banks accept postdated checks if they are dated and signed. However, since postdated checks are often used when the payer is waiting for funds to clear in their account, you may be better off just waiting for the date on the check.
What is postdating a payment?
Postdating a payment refers to postdating a check. When someone postdates a check, that signals that they don’t want the payee to cash the check until that date. Some banks or credit unions still allow payees to cash postdated checks if they are signed by the payer. So if someone really doesn’t want a check to cash before a certain date, they should ask their bank about issuing a formal post-dating notice (which may incur a fee).
Credit cards can come with a four-digit personal identification number (PIN). The PIN acts like a password, helping to prevent unauthorized use of your credit card. However, in the U.S., PINs are more often required when using debit cards than when using credit cards.
Hence, if you live in the United States and don’t often travel abroad, you may not find yourself using a credit card PIN most of the time. Still, it can be helpful to understand their purpose and how to obtain one just in case.
What Is a Credit Card PIN?
A credit card PIN is a four-digit personal identification number used to help verify the integrity of certain transactions that might occur while using a credit card. You might receive a PIN with your new credit card; however, it will probably be mailed separately for security reasons. This way, if someone were to steal your card, they won’t gain access to your PIN along with it.
Credit card PINs offer an added layer of security alongside other measures, such as your signature, the credit card’s EMV chip, or the credit card CVV number. In the United States, chip and signature are the preferred security measures for most types of transactions, but there could still be times when you need a PIN.
How Do Chip and PIN Cards Work?
Chip and PIN generally refers to credit cards that have a microchip that can be inserted into a card reader. As their name suggests, these cards may also require the cardholder to authorize the transaction by entering their PIN.
The use of a microchip and a PIN allows for increased security when compared to credit cards of the past, which only used a magnetic stripe to complete transactions. Also called stripe and signature cards, these older credit cards are considered less secure than chip and PIN credit cards. This is because the magnetic stripe has your card information coded directly into it.
An increase in credit card data breaches called for a more secure solution. That led to the adoption of EMV cards, named for the three organizations that developed the technology — Europay, Mastercard, and Visa. EMV cards would become the chip and PIN cards we know today, later joined by contactless payments.
The main benefit of EMV, or chip and PIN, cards is that they generate a one-time code when inserted into the card reader. Instead of sharing your card number with the merchant, the code is used to process the payment. This process is more secure than using a magnetic stripe because it makes it much more difficult for thieves to attempt to steal your credit card information.
There’s little difference between a credit card PIN and a debit card PIN. Both are four-number codes that you use to verify transactions in some situations.
At least in the U.S., the most notable difference between credit vs. debit card PINs is that debit card transactions require a PIN more often than credit card transactions do. In other countries, the use of PINs for credit card transactions could be more common.
A cash advance works like a loan from your credit card issuer. There are a few ways to request a cash advance, but one way to do so is by using your credit card at an ATM. You may be required to enter your PIN when requesting a cash advance, and credit cards sometimes have daily cash advance limits.
European credit cards often use chip and PIN technology, which can help keep your money safe when traveling abroad. That means you could be required to enter your PIN, even for purchases. For instance, automated kiosks in Europe may only work with foreign credit cards if you provide a PIN.
Guide to Requesting a Credit Card PIN
Whether or not you think you’ll need a credit card PIN, you can request one from your card issuer just in case you do end up needing it in the future. Keep in mind that your card issuer may have sent you a PIN when they shipped your new card. However, as mentioned earlier, the PIN likely was not sent in the same envelope as your credit card for the sake of security.
If you aren’t able to locate a PIN that was sent with your card, you can request a new one in the following ways:
• On your bank’s website. Some banks allow you to request a new PIN while logged in to your account. To do so, you can search your bank’s website for information on requesting a PIN for a credit card.
• By phone. Some banks require you to call to request a PIN on a credit card. If that’s the case, or if you simply prefer to call, your card issuer should provide a support number. They likely won’t issue you a new PIN over the phone but will instead mail it to the address on file.
• At a bank branch. If your bank has branches nearby, then you should be able to request a PIN by visiting a branch and asking them to reset it for you.
• At an ATM. If you know your existing PIN and simply want to change it, you might be able to change your credit card PIN by visiting an ATM.
If you request a new PIN either online or by phone, it should be mailed to your address on file. Thus, you should make sure your address is up to date before requesting a PIN.
Another important credit card rule to keep in mind is not to use personally identifiable information in your PIN, such as your birthday or your address. While those might be easier to remember, they can also be easier for a thief to guess.
Do All Credit Card Issuers Offer Cards With PINs?
The answer to this question may depend upon your location. In the U.S., for example, most credit cards have at least chip and signature verification, though an increasing number have chip and PIN. While chip and PIN adoption has increased in the U.S., the technology is already fully implemented in much of the rest of the world.
Most major banks in the U.S. offer PINs with their credit cards, even if PIN verifications aren’t always required.
Finding Your Credit Card PIN Number
When you were approved for your new credit card, you might have received a separate mailer with your credit card PIN along with relevant information about using it. If you never received your PIN or you lost it, you probably won’t be able to find your credit card PIN by logging into your account. Usually, you’ll either need someone to reset it for you at a bank branch or ask to have a new PIN mailed to your address on file.
Are Credit Card PINs Safe?
Chip and PIN credit cards tend to be much safer than their magnetic stripe counterparts of the past. This is because chip and PIN credit cards do not share your credit card number; instead, they generate a unique, one-time code to verify the transaction. Hence, schemes that worked in the past, such as credit card sniffing, are much less likely to succeed with chip and PIN credit cards. This helps you keep your data safe, along with your money.
With the adoption of EMV, credit cards may have a PIN, but purchases don’t often require them in the United States. However, your card issuer may have sent you a PIN when you were approved for a new card. Chip and PIN technology makes credit cards more secure so you can feel more confident about your purchases.
Of course, you have many options when considering new credit cards. One card equipped with all the latest security technology is the SoFi credit card. Not only will your purchases be secure, but you can earn 2% unlimited cash back rewards.
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FAQ
What if my credit card company does not allow chip-and-PIN purchases?
Most credit card companies should allow chip-and-PIN purchases, or at the very least, chip and signature. All U.S. merchants were asked to begin accepting EMV chips by October 2015. While there’s no federal law requiring EMV compliance at the moment, it is considered industry-standard. As a result, most credit card issuers have already adopted EMV standards.
Can I use the same PIN for all credit card transactions?
Some card issuers might allow this, but others may not — it depends on the banking institution. For example, your card may not allow you to use the same PIN for cash advances that you use for purchases. If that is the case, you will need to remember two different PINs.
How do you get a PIN for your credit card?
Card issuers will often send you a PIN when you apply for a new credit card. However, if you lost your PIN or don’t recall receiving one, you can try requesting one from your bank. You may be able to request a PIN via online banking; if that isn’t possible, other options include asking for one on the phone or visiting a bank branch.
Can you use a credit card without a PIN?
Whether you can use a credit card without a PIN depends on the kind of transaction you’re making. For example, if you are in the U.S. and requesting a cash advance with your credit card at an ATM, it is unlikely that you will be able to do that without a PIN. Purchases, on the other hand, often don’t require a PIN in the United States.
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A car loan, a mortgage, student loans, credit cards. It might feel like a dark debt cloud is looming over you sometimes. If you carry some debt on your personal balance sheet, you’re not alone.
The Federal Reserve’s most recent report shows that total household debt in the U.S. has reached more than $15.84 trillion. That includes everything from mortgages to credit cards to student loans. We’re a heavily indebted nation, and for some, it may take a psychological toll. If that’s you, here’s the comforting news: There are some tried-and-true strategies for paying back outstanding debt.
What Is Considered Outstanding Debt?
What is outstanding debt? Outstanding debt refers to any balance on a debt that has yet to be paid in full. It is money that is owed to a bank or other creditor.
When calculating debt that’s outstanding, add all debt balances together. This could include credit cards, student loans, mortgage loans, payday loans, personal loans, home equity lines of credit, auto loans, and others. You should be able to find outstanding balance information on your statements.
How to Find Outstanding Debt
When paying off outstanding debt, you first might need to track it all down.
As you move throughout the debt payoff journey, you may find it helpful to start a file for your statements and correspondence. Also, you could create a list or input information into a spreadsheet. Organizing your information is necessary for building a debt payoff strategy.
Build a list of all debts with the most useful information, such as the outstanding balance, the interest rate, the monthly payment, the type of debt, and the creditor. If you have an installment loan, such as a personal loan, the principal amount of the loan is another helpful piece of information.
What if I Can’t Find All My Outstanding Debts?
If you feel as though you’ve lost track of some debts, you may want to start by requesting a credit report from at least one of the three major reporting agencies, Experian®, TransUnion®, or Equifax®. You are legally entitled to one free copy of your credit report from each of the three agencies per year. It’s easy to request a credit report from AnnualCreditReport.com .
A credit report includes information about each account that has been reported to that particular agency, including the name of the creditor and the outstanding debt balance.
It is possible that some outstanding debts may have been sold to a collection agency. The name of the original creditor may be included on the credit report. If that is not the case, you may need to investigate further.
Some outstanding debts may not appear on a credit report. Creditors are not required to report to the agencies, but most major creditors do. That said, a creditor could choose to report to none, one, two, or all three of the agencies. If you’re in information-collecting mode, you may want to consider requesting reports from more than one agency, or all three.
Outstanding Debt Amounts
Aside from how a debt is structured — revolving or installment debt — it can also be thought of as good debt or bad debt.
Generally, if borrowing money, and thus incurring debt, enhances your net worth, it’s considered good debt. A mortgage is one example of this. Even though you might incur debt to purchase a home, the value of the home will likely increase. As it does, and as you pay down the mortgage balance, your net worth has the potential to increase.
Bad debt, on the other hand, is debt taken on to purchase something that will depreciate, or lose value, over time. Going into debt to purchase consumer goods, such as cars or clothing, will not enhance your net worth.
Each person has a unique financial situation, level of comfort with debt, and ability to repay debt. What one person may be able to justify may be completely unacceptable to another.
How Does an Outstanding Debt Impact Your Credit
One thing lenders may consider during loan processing is the applicant’s debt-to-income ratio (DTI). Lenders will look at this number to determine their potential risk of lending. Different lenders have different stipulations about this ratio, so asking a potential lender about theirs is a good idea.
Calculating DTI is done by dividing monthly debt payments by gross monthly income.
• Monthly debt payments can include rent or mortgage payment, homeowners association fee, car payment, student loan payment, and other monthly payments. (Typically, monthly expenses such as utilities, food, or auto expenses other than a car loan payment are not included in this calculation.)
• Gross income is the amount of money you earn before taxes and other deductions are taken out of your paycheck.
Someone with monthly debt payments of $1,000 and a gross monthly income of $4,000 would have a DTI of 25% ($1,000 divided by $4,000 is 25%).
Generally, a DTI of 35% or less is considered a healthy balance of debt to income.
Should I Pay Down Outstanding Debt?
Barring extenuating circumstances, it’s a good idea to make regular, consistent payments on your debt. Whether or not you decide to pay the debt back on an expedited schedule is up to you.
Some may not feel the need to aggressively tackle their outstanding debt. They may be just fine to continue paying off a balance until the loan’s maturity date. This may apply to people with manageable debt payments, those who have debts with lower interest rates, or those focusing on other financial goals.
For example, someone with a low-interest-rate mortgage loan may not feel the need to pay it down faster than the agreed-upon schedule. So they continue to make regular, scheduled payments that make up a manageable percentage of their monthly budget. Therefore, they are able to work on other financial goals in tandem, such as saving for retirement or starting a fund for a child’s college.
Other scenarios may call for a more aggressive strategy to pay down debt. Some reasons to consider an expedited plan:
• Debt levels, and therefore monthly payments, feel unmanageable.
• Carrying debts with higher interest rates, like credit cards.
• Missed payments and added fees.
• It could also be as simple as wanting to have zero debt.
Carrying a large debt load could negatively affect your credit score. One factor in a credit score calculation is the ratio between outstanding debt balances and available credit on revolving debt, like a credit card — the credit utilization rate.
Using no more than 30% of your available credit is recommended. So, if a person has a $5,000 credit limit on a card, that would mean using no more than $1,500 at any given time throughout the month. Using more could result in a ding on their credit score.
Carrying debt also means paying interest. While some interest may not be avoidable, it’s generally a sound financial strategy to pay as little in interest as possible.
Credit cards tend to have some of the highest interest rates on unsecured debt. The average interest rate on a credit card is nearly 17%, as of June 22, 2022. Penalty rates can reach nearly 30%. With high rates, it’s worth seriously considering paring back debt balances.
Two popular strategies for paying off debt are called the debt snowball and the debt avalanche. Both ask that you isolate one source of debt to focus on first.
Simply put, you’ll make extra payments or payments larger than the minimum monthly payment on that debt until the outstanding balance is eliminated. You’ll continue making the minimum monthly payment on all your other debts.
Debt Snowball
A debt snowball payoff plan involves working on the source of debt with the smallest balance. For example, a person with three credit cards would pick the one with the lowest outstanding balance and work on paying it down.
The idea here is that there’s a psychological boost when a card is paid off, so it makes sense to go after the smallest first. That way, when a person works up to the card with the next highest balance, they can focus singularly on it, without a bunch of annoying, smaller payments getting in the way of the ultimate goal.
It’s called a snowball because the strategy starts small, gaining momentum as it goes.
Debt Avalanche
Alternatively, the debt avalanche method starts with the debt with the highest interest rate. Because this source of debt costs the most to maintain, it is a natural place to focus.
The debt avalanche is the debt payoff strategy of choice for those who prefer to look at things from a purely mathematical standpoint. For example, if a person has one credit card with an 18% annual percentage rate and another with 12%, they’d focus on that 18% card with any extra payments, no matter the balance.
Of course, it is also possible to modify these strategies to suit personal preferences and needs. For example, if one source of debt has a prepayment penalty, maybe it drops to the bottom of the list. If there’s a particular credit card you tend to overspend with, perhaps that’s a good one to focus on.
Outstanding Debt Payoff Methods
Once you decide on a strategy, whether it’s one discussed above or something that works better for your financial situation, you’ll need to figure out where the money will come from to pay down outstanding debt.
Starting by simply listing your monthly income and expenses is a good first step. If you find that you have enough money to begin making extra payments toward your outstanding debt balances, then you might choose to start right away.
Some people choose to keep a 30-day spending diary to get a clear picture of what they spend their money on. This can be a good way to pinpoint areas you might be able to cut back on to have more money to apply to outstanding debt.
If your existing budget is already tight and won’t accommodate extra payments, you might consider looking for some other financial strategies.
Increasing Income
Sometimes the answer is just to make more money. That could mean getting a part-time job or selling things you no longer need or want. You might also think about asking for a pay raise at your regular job.
Using Personal Savings
Tapping into money you’ve saved can be another way to pay down outstanding debt. Savings account interest rates, even high-yield savings accounts, pay much less interest than you might be incurring in interest on your outstanding debts. Keeping enough money in a savings account as an emergency fund is recommended, but if you have a surplus in your personal savings, putting that money toward your debt balances is a good way to make headway on outstanding debt.
Consolidating With a Credit Card
Using a credit card to pay off debt may seem an unlikely choice, but it can make sense in some situations. If your credit score is healthy enough to qualify for a credit card with a zero- or low-interest promotional rate, you might consider transferring a higher-rate balance to a card like this.
The benefit of this strategy is having a lower interest rate during the promotional period, potentially resulting in savings on the overall debt.
There are some drawbacks to transferring a balance in this way, though. One is that promotional periods are limited, and if you don’t pay the balance in full during this period, the remaining debt will revert to the card’s regular rate. Also, it’s typical for a promotional-rate card to charge a balance transfer fee, which can range from 3% to 5%, or more, of the balance transferred. This fee will increase the amount you will have to repay.
Consolidating With a Personal Loan
Using one new loan to pay off multiple outstanding debt balances is another debt payoff method. A personal loan with a lower overall rate of interest and a straightforward repayment plan can be a good way to do this.
In addition to one fixed monthly payment, a personal loan provides another benefit — the balance cannot easily be increased, as with a credit card. It’s easy to swipe a credit card for an additional purchase, potentially undoing the progress you’ve made on your debt repayment plan.
To consolidate with a personal loan, you might want to look around at different lenders to get a sense of what interest rates they might offer for you. Typically, lenders will provide a few options, including loans of different lengths.
The Takeaway
Outstanding debt can be a heavy burden. Many people owe large amounts of debt, but don’t know how to start making a dent in their balances. A good place to start is by identifying income and expenses to see your overall financial picture. From there, you may decide to focus on paying down certain debts over others. Choosing one method to pay down your debts and finding the money to do so are the next steps.
If you decide to pursue a debt payoff strategy, an unsecured SoFi Personal Loan may be an option for you. SoFi offers unsecured, no-fee option, low fixed-rate personal loans to help guide your financial journey.
Ready to kick-start your debt payoff strategy? A personal loan from SoFi could help you consolidate your debt into one easy-to-manage monthly payment.
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Everyone buys groceries, but how much should an individual or household spend on food each month? Food is the third largest expenditure for Americans, and for those looking to cut costs, it can be a place where reductions are possible with some planning and budgeting.
In 2020, Americans spent an average of 8.6% of their income on food, according to the most recent data from the U.S. Department of Agriculture. Everyone is different when it comes to their personal food choices, household, and budget, so it’s difficult to come up with a goal amount for everyone’s monthly grocery bill. However, looking at averages across the country can help one figure out if they are within the range of other people in their region, age bracket, and household size.
Inflation can have a big effect on the price of groceries, making it harder to stay within a budget and reduce one’s bill. Over the past year, the cost of groceries has increased by 10.8% . Some foods, such as meat, poultry, and eggs, have risen by 14.3%. This increase is partly due to inflation and partly due to food shortages caused by the COVID-19 pandemic.
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Average Monthly Grocery Budget Bill for One Person or More
There are several factors that determine how much a person might spend on groceries each month. These include age, gender, how many people live in the household, and monthly budget. Another major factor is the region one lives in. Some areas have much more expensive food than others.
The most expensive city for groceries is Honolulu, Hawaii, where the monthly average grocery bill is $556.76. The least expensive city is Manchester, New Hampshire with an average of $183.00, according to Move.org. Other expensive states include Vermont, Alaska, and New York, while less expensive states include Kansas, Idaho, and Utah.
In addition to groceries, one’s overall monthly bill for food includes any snacks and meals eaten out. The averages below are based on an individual or family cooking all their meals and snacks at home, they don’t include meals eaten out. Averages look at foods many people commonly purchase, such as eggs, dairy, meat, bread, and produce items.
Family Size
Average Grocery Bill
1
$229-$419 depending on age and gender. Men and younger people have a higher average.
2
For a household with two people, the average grocery bill doubles to $458-$838. If a household consists of one adult and one child their bill is likely less than a household with two adults.
Averages for children vastly vary depending on the age and gender of children, location, and budget. For each child under 12 added one can estimate an additional $143-$357 in their bill. If teenagers are in a household one can expect to add an additional $233-$344.
4
Averages for a family of four are based on two adults between the ages of 20-50, and two children, one aged 6-8 and one aged 9-11. The average grocery bill is $887 per month.
Particular Foods That Are More Expensive Now
As briefly mentioned, in the past year, some foods have risen in cost more than others, due to issues in the supply chain. These include meat, fish, eggs, and poultry.
Buying Groceries vs Dining Out
It’s up to each individual and family to decide how often to eat out or get takeout food and how much of their money to spend on dining at restaurants. In general, eating out tends to cost more than cooking at home, and it’s a good idea to keep track of and budget for or it can add up quickly. The USDA recommends spending about 4% to 5% per month on dining out. A couple ways to help save money on eating out are to pick up food instead of having it delivered, and to find discounts and loyalty programs for local restaurants.
9 Tips for Reducing Your Grocery Bill
In looking at the average grocery bills above, one might start to think that they are spending too much on groceries, if they didn’t already feel that way before. Here are a few tips for lowering one’s monthly grocery bill.
1. Make a Budget and Plan Ahead
Allocating funds for groceries in a monthly budget planner then making a plan for what to buy can help reduce one’s grocery bill. Meal planning and shopping lists can help with sticking to the plan.
2. Look for Discounts and Sales
There are many discount apps and coupons available for those who are grocery shopping on a budget. They are free and can help with reducing one’s grocery bill. However, some coupons can be tricky and actually cause additional spending, if they ask one to purchase two or more of an item to get the discount or they result in buying an item that wouldn’t have been purchased otherwise. Some stores also have sale days, especially after a big holiday, so those can be good days to go shopping.
3. Don’t Shop on an Empty Stomach
Avoiding impulse buying is another way to reduce one’s grocery bill. Studies have shown that shopping on an empty stomach leads shoppers to spend more and to buy high calorie foods that may be less healthy.
4. Consider Meal Kits
Although meal kit services may appear expensive, and some are, if they reduce the amount that one eats out at restaurants or the amount spent on groceries, that is a plus. Meal kits provide pre-portioned meals, so they prevent buying extra ingredients that go to waste.
5. Pay Attention to Delivery Fees
Having groceries delivered can be a great way to save time, and since it can help with sticking to a plan and grocery list, it can also help prevent impulse buys. However, delivery fees and tips can add up, so it’s important to factor those into monthly budgeting.
6. Shop at a Different Store
It can be easy to fall into a pattern of shopping at a certain grocery store due to convenience or their offering of foods one likes. But if that store has higher prices, it may be worth considering going to a different store for some or all of one’s groceries.
7. Create a Routine
Another way to stay on top of grocery budgeting is to create routines. This can help with sticking to a shopping list and making sure extra food doesn’t get purchased.
8. Buy Generic Brands instead of Name Brands
Many stores carry their own brands of food that are cheaper than big name brands. These items are very similar in taste and quality but have a lower price point.
9. Shop More Often
It may seem surprising, but going to the grocery store more often can help people spend less money than if they go on mega runs. The reason is that it avoids food waste because it’s easier to think about what will be eaten within the next few days than the next couple weeks.
The Takeaway
Since there is more flexibility in buying groceries than other expenses such as rent and other bills, cutting back on grocery spending can be a great way to save. If you’re looking to start making a budget, setting savings goals, or paying off debts, one money tracker tool to use is SoFi’s. The online app lets you connect all your banking and investment accounts so you can easily see what you are spending and saving all in one dashboard. You can create goals and set up automated savings and investments to secure your financial future.
Start making a budget and savings goals today.
FAQ
How much should you be spending on groceries a week?
The average cost of groceries for U.S. households is $102 per week. This varies greatly by location, age, and number of people in one’s household.
What is the average cost of groceries per month?
The average cost of groceries for U.S. households is $411 per month.
Examples of Popular Discounted Grocery Stores
Popular discounted grocery stores include Walmart, Smart & Final, Sam’s Club, and Trader Joe’s.
Photo credit: iStock/andresr
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
The Biweekly Money saving challenge is a great one to start with. It requires putting away cash for 26 weeks or every other week for one year. The amount you choose to save can vary based on your goals and comfort level.
Types of Biweekly Money Saving Challenges
If you’re paid bi-weekly, this plan type might suit your lifestyle best. It’s budget friendly, too. So if you have a little or a lot of change after bills, you can adjust this challenge to meet your needs.
26-Week or Biweekly Savings Challenge
There are many versions of this challenge. You can start with a small savings amount, like $3 or $4. If you choose the first amount, put $3 away in savings the first week. Every two weeks, add an extra $3 to the last amount you put away. So, the first week, you’ll put away $3. The second week, $6. The third week, $9. At the end of the 26-week challenge, starting with $3, you’ll have $1,053 in savings.
You might prefer a fixed savings goal, like $5,000 or $10,000. If that’s you, put away between $193 to $385 every two weeks. You’ll end up with $5,018 or $10,010, respectively.
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How to Choose a Money-Saving Challenge
Choose a financial challenge that works with your budget and meets your goals. Setting goals and starting small can be a big win in many ways. It lays the building blocks for long-term savings habits that last over time.
Find a challenge that is budget-friendly. The amount you put away can be as little as a nickel on day one. If you have more change to spare — you can put away more money. Some challenges suggest multiple savings accounts or stashing cash. If you choose to open multiple accounts — interest-bearing accounts will earn some returns, are FDIC insured, and can be accessed for emergencies or planned expenses.
You might have specific financial goals, like an emergency or wedding fund. Or you might want to build a habit of saving. Whatever your goal, a challenge can help you commit to saving $500 to $15,000 in a set amount of time — or build a good habit.
And there’s no shortage of creativity. Google has about 337,000 pages worth of money saving challenges from Pinterest to blogs like Mama Managing Chaos or Dough Roller. You can even try saving $2,022 in the 2023 money saving challenge. Below is a list of money challenges to get you started.
100 Envelope Challenge
Number 100 envelopes from 1-100. Each day, put in the amount of cash listed on the envelope. By the end of 100 days, you’ll have $5,050 stashed away.
In a variation, 100 days can be broken down into 13 weeks for easier deposits. The last week is four days. Every other week, set aside the week’s total of savings. Below’s chart lays out the amounts:
Week
Amount
1
$28
2
$92
3
$156
4
$220
5
$284
6
$348
7
$412
8
$476
9
$540
10
$604
11
$668
12
$732
13
$490
Holiday Helper Fund
The holidays sneak up on us quicker than we think. If you’re planning your annual budget — try setting up an account or an envelope for gifts. Setting aside an extra fund for gifts, whether holiday, wedding, or general, keeps money out of sight and mind until you need it.
On the week of January 1, set aside $20 every week, or $40 every two weeks. By December 25th, you’ll have $1,040. If you like to shop early — aim for Black Friday! In 2023, Black Friday falls on week 47. That puts you at $940 for gifts.
52-Week Savings Challenge
The concept is simple. You set aside $1 at week one. Then $2 at week two. By the end of 52 weeks, you’ll have saved $1,378. You can also start with $2 or $10 on week one, $4 or $20 on week two, and so on. You’ll end up with $2,756 for the $2 challenge or $13,780 for the $10 challenge.
Another variation keeps the weekly savings contribution a fixed amount — which can be particularly helpful for smaller budgets. For example, you can put away $10 a week to end up with $520 at the end of the challenge.
The No Spend Challenge
Brunching on Sunday? Maybe not if you’re on this plan.
Pick a week or weekend and spend money on only necessities in a timeframe (like a month). Cut out discretionary spending on non-essentials like clothes, entertainment, and eating out. It’ll give you a chance to be creative with your time on limited resources.
Instead of eating out, try a new recipe at home. Instead of grabbing a new pair of shoes — dig deeper into your closet. You set your own time limit, so you can try it until you notice a change in your accounts!
Cash Only for a Month Challenge
An MIT study found that people tend to spend more with plastic, if given the option. It even stimulates the part of your brain associated with reward, pleasure, and addiction.
A cash diet can help stave overspending. Leave your cards at home when you go out and bring the amount of cash you decide to spend. You can look at the categories in your budget where you tend to overspend, like entertainment or clothes, and set aside cash for those categories. You can only spend the cash allotted for those categories.
If you have a nickel to spare, you can do this challenge. On day one, put a nickel in a jar. On day two, put in 10 cents in the jar. On the third day, add 15 cents. By day 365, you’ll be adding $18.40 — to a total of $3,339.75 in your savings. You won’t have to put away more than $20 in a day and $130 in a week for the entire challenge.
30-Day Budget Preparedness Challenge
It helps to have a map for where you’re going. The same is true with spending.
Challenge yourself to a budget. First, download a budget planner like a spreadsheet template or a budget planner app. SoFi’s app is an effective way to track spending. It even has a debt payoff planner to track your progress.
Then, go through each category and add the amount you’d like to or must spend in each (such as housing, groceries, entertainment, etc).
Knowing how much to spend before you go out can help improve your planning and control your spending. For example, if you allocate $400 a month to groceries, you can plan it by spending $100 a week. If you don’t spend it all, you can put it in savings.
Money-Saving Challenge Potential Savings
Taking on one of these challenges can help you boost your savings anywhere from $1,000 to $10,000.
But goal-setting will help you determine how much you want to save. If it’s $20,000 in two years, try the bi-weekly savings challenge. If you want to have $1,000 in your account, shoot for the 52-Week Savings Challenge. It’s a fun, concrete way to start.
If spending less is your goal — a challenge can help you cut bad habits like overspending. Setting up a budget and spending cash (not plastic) can help. Some challenges can help you function as a money tracker if paying off debt is your goal.
Whatever your goal is, these challenges are practical journeys that can pay off.
The Takeaway
A money saving challenge can be a fun way to build a savings account. It can motivate you to spend less and save more. It can be a concrete demonstration of how small change can add up.
One of the more popular ones is the biweekly money saving challenge. You can put away an amount you can afford — like $4 and increase it by $4 each week. Or you can set a goal of $5,000 and aim to set aside about $193 each week. It’s an easy plan that can adapt to many situations.
Best of all, you come away with stronger budgeting skills — like saving and prioritizing debt payoffs. These skills could help you make more fiscally responsible decisions. And when life happens, you’ll be better prepared.
SoFi’s app is one way to flex budgeting skills. It tracks your financial goals, accounts, spending, and more — all in one place. You even get access to your credit score at no cost. Try it today.
FAQ
What is the 100 envelope challenge?
This is a popular 100-day challenge. Number 100 envelopes 1-100. For each day, add the amount of cash to the envelope’s number listed on it. For example, add $1 to the envelope labeled 1, $5 to the envelope labeled $5, and so forth. By the end of the challenge, you’ll end up with $5,050.
What is the most popular money saving challenge in 2023?
There is no top biller for popular money saving challenges, but the 52-Week Savings challenge is mentioned across most, if not all search results in a Google search.
How much money do you save with the 52-week challenge?
If you follow the original plan of starting with $1 on week one, then $2 on week two, $3 on week three, and so forth, you’ll end up with $1,378. Other variations involve changing the starting amount. For instance, you can start with $5 on week one, $10 on week two, until you have $6,890 put away.
Photo credit: iStock/Rawpixel
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
