Major online bank with 11million customers launching new feature to help you save £700 in 2025 ‘effortlessly’
A MAJOR online bank is unveiling a new feature on its app to help customers stash away nearly £700 in 2025.
Monzo will launch the 1p Savings Challenge in the New Year so savers can build up a cashpot with “no effort”.
It comes after research carried out by the online-only bank, with 11million customers, revealed 39% of Brits find it hard to save on a consistent basis.
The new feature will move money from customers’ personal accounts to a Challenge Pot each day.
Bankers will start by saving 1p on January 1, with the amount added increasing by 1p each day over all 365 days of 2025.
So, on January 3, 3p will be added and on January 7, 7p will be transferred from your personal account.
If customers stick with the challenge for all 365 days of 2025, they’ll end up with a pot worth £667.95.
New and existing customers can sign up via www.monzo.com/features/1p-saving-challenge.
The savings challenge isn’t currently live but customers will be notified via their apps when it is in the New Year.
Monzo also said it will offer one customer who completes the full 365 days a chance to win a £10,000 prize – while other prizes will be on offer for customers who pay for its monthly plans.
One other bank offers customers an automated 1p Saving Challenge feature – Plum.
However, they have to sign up to an Ultra plan to access the feature which currently costs £2.49 per month.
OTHER SPENDING CHALLENGES
Monthly savings challenge – £780
This 12-month savings challenge encourages you to save one lump sum every month.
Savers begin with £10 and gradually increase each month. Multiply the month by ten to calculate the savings you need to set aside.
For example, you’ll save £10 in the first month (January) and £20 in the second month (February).
Do this for the whole twelve months and you’ll have £780 sat in your account at the end of 2024.
52-week challenge – £1,378
The 52-week challenge works by getting participants to put aside £1 for the first week, £2 for the second, £3 for the third, and so forth, until the end of the year.
The amounts start small, but towards the end of the year, you might find the weekly savings target grows too big.
For example, you’ll have to put away the largest sums around Christmas with a whopping £202 in total required in the final four weeks of the year.
So before you start, consider whether it could be too much of a stretch at an already expensive time of year.
If you can stick to it though, the payoff is huge as you’ll pocket a whopping £1,378.
You could always flip it and start with the biggest amount (£202 a week) and then get smaller – it might be worth making a chart so you can keep on top of figures.
26-week challenge – £1,378
This adaption of the 52-week challenge is ideal for people who get paid fortnightly.
As you can see, the savings outcome at the end is the same but how it works is a little more complicated.
The idea is that you start on week two and save £3 (so that’s the £1 from week one, and the £2 from week two), and then in week four, you’ll save £7 (week three and four).
This may make it harder to follow, but it can help spread out your savings.
365-day challenge – £1,456
If the 52-week challenge seems a little daunting, you might prefer the 365-day challenge.
You’ll set aside £1 on Sunday, £2 on Monday, £3 on Tuesday and so on, all the way up to saving £7 on Saturday – the largest daily amount of the week.
You then restart the process on the next Sunday.
This should give you a weekly total of £28 in savings – adding up to £1,456 over the cost of the year.
The fiver challenge – save £7,000
The fiver challenge is one of the most hardcore savings tests but it’ll leave you rolling in it if you succeed.
It works wonders for those saving for a milestone, like a home deposit, wedding, car, or another big purchase.
To make this challenge more achievable, you can take it on with a partner – so each of you save £2.50 to begin with.
This challenge works the same as the 52-week challenge, but you go up in multiples of £5 rather than £1.
So you save £5 in week one, £10 in week two, and up to £260 in week 52.
Round-up challenge
The round-up challenge means you round up money you’ve spent and put that extra cash away into savings.
For example, if you’ve bought something that cost £19.30, then you’ll be able to spend £20 and you’ll have 70p in savings.
It might not sound like much but if you’re doing this with every transaction then it adds up.
Some banks will allow you to do this via your online banking app, so check with whoever you bank with.
Money mistake jar
With a money mistake jar, you can make things more personal.
The idea is that you challenge yourself not to do something, or to not make a “mistake”.
For example, maybe you want to challenge yourself to go running three times a week, or maybe you want to stop buying takeaways or simply stop swearing.
These can be your “mistakes” and if they’re not fulfilled then you can put money into the jar.
How much you put in each time is completely up to you.
How you can find the best savings rates
If you are trying to find the best savings rate there are websites you can use that can show you the best rates available.
Doing some research on websites such as MoneyFacts and price comparison sites including Compare the Market and Go Compare will quickly show you what’s out there.
These websites let you tailor your searches to an account type that suits you.
There are three types of savings accounts fixed, easy access, and regular saver.
A fixed-rate savings account offers some of the highest interest rates but comes at the cost of being unable to withdraw your cash within the agreed term.
This means that your money is locked in, so even if interest rates increase you are unable to move your money and switch to a better account.
Some providers give the option to withdraw but it comes with a hefty fee.
An easy-access account does what it says on the tin and usually allow unlimited cash withdrawals.
These accounts do tend to come with lower returns but are a good option if you want the freedom to move your money without being charged a penalty fee.
Lastly is a regular saver account, these accounts generate decent returns but only on the basis that you pay a set amount in each month.
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