SparkGuy's Savings Jar Club - Draft

Introduction – Reasons for the Savings Jar Club

Hello Everyone

I started SparkPeople to help millions of people reach all kinds of goals - usually using health and fitness as a springboard to success in other areas.  Another area that really interests me besides health and fitness is finance and savings. I've spent the last 3 years learning how to be a good investor and now manage most of my portfolio myself.

Good savings and investment strategies can have a dramatic impact on the quality of anyone’s life.  Also, this doesn’t have to mean depriving yourself of things that make life enjoyable.  In fact, the opposite is true.  By learning how to be a good saver and investor, you will probably end up being able to purchase more things that are meaningful to you AND save money for retirement and other big life events as well.

One thing that frightens me about
now is that Americans currently spend more than they earn (collectively) for the first time since the Great Depression. Yes, we have a negative savings rate. I won't get into all the details of what problems this could cause yet, but I have decided to see if I can help do something about it - hopefully with your help.

Savings goals and investing is very similar to the SparkPeople philosophy of losing weight - small steps done consistently over time lead to big results.  So, I'm starting something small right here and hope that it will lead to something big over time - the Savings Jar Club.

To kick this off, I have just placed a "jar" - for now a small plant holder - on my desk and put $1 in it.  I am setting a goal to put at least $1 in this jar every day for the next year and then deposit it into the bank at intervals so it will earn interest.

My challenge to everyone else is to join in and help me. I'll set a modest goal to start. By
December 31, 2006, I hope to have this Savings Club reach a total of $10,000. Hopefully I'll have to revise this goal upwards as we build momentum.

Who's with me!? Here is a link to the board: Savings Jar Club board

For simplicity, please try to convert any other currencies to US dollars for now - if this grows, we might be able to build in a currency calculator too.

I'll start the tally now: $0 + $1 = $1

There, we're off to the races!

Rules & Guidelines

Here's how it works. Anyone can participate no matter where you live. Just hop in and set a goal, setup your "jar" however that works best for you, and then report regularly each time you save something.

I will start a tally and for now we will simply do this manually. If this takes off, I'll have our vaunted engineering team build software around it that does the math for us :)

With each post, include:
1. Total amount in the collective savings jar by adding your new addition to the prior amount
2. Your personal total (if you are doing multiple ways of adding to your jar (see below), I’d suggest breaking those out into different categories.

Here are the 3 ways you can add to your savings jar total:

1. Savings
These are dollars that physically go into your savings jar, or into a savings account on a regular basis.

2. Non-Expenses
Another way to save money is by not spending it in the first place.

So, if you make a choice to not spend money on something you normally would buy - or you buy a less expensive version, you can also add that to the total. For example, if you buy a small coffee for $2 instead of a massive coffee for $5, then you can add $3 to the total.

And yes, you CAN double-count an amount to get bonus points. For example, if you buy that small coffee instead of a large one and don't spend $2 - and then you also put that $2 into your savings jar, then you can claim both sides of that "transaction" for a total of $4.

3. Debt Payoff
A third way to add to your savings jar total is to pay off some of your existing debt – especially for “bad” types of debt that carry high interest rates like most credit cards.

For credit card debt or other debt payoff to be added, it should be debt you've had for more than one payment cycle - so not just typical monthly expenses that you put on your credit card. For example, if I go shopping and pay $250 and put that on my credit card, then when if I pay off that $250 on my credit card statement that month I shouldn't count that as debt payoff.

So, for example, if you have an ongoing $1,000 balance on a credit card and make a monthly payment of $150 which consists of a $50 minimum monthly payment and then a $100 extra payment I say you can add that $100 to our total and call it "debt payoff".

As a note, some types of debt can be good if not abused - like mortgages at a good rate that don't consume too much of your income, student loans, etc.


One of the things that motivates me to be a saver is realizing that a dollar isn't a dollar. You really have to think about what you could turn that dollar into in the future. This rule helps you make wiser spending decisions. That way you end up being able to buy more of what you really want/need AND save more for the long-term too.

Here are some different ideas to use as motivation:

  • Split your savings between something fun like a trip and something serious like retirement
  • Save for something that helps celebrate your new healthy lifestyle
  • Turn your savings into a long-term investment plan to use for retirement, kids’ college, a house, or other large “life event” things.
  • One big motivator is to just be free from financial worries.  Studies show finances can be one of the largest stressors in life – and can cause many marital problems.

This motivation can help turn savings into something fun and exciting - more fun than some of the mindless things we spend our money on that we think we need.

What tomorrow do you want to save for today?

What To Do With Your Savings

It’s great to save money in a jar, but even better to get that money earning interest over a long time period.  Eventually I’ll add more about investing in stocks, bonds, and other investments, but for now let’s at least get that cash into a savings account that pays a FAIR interest rate.

As a note, I DO think it’s a good idea to keep a stash of cash on hand for true emergencies.  So, you could use some of your savings jar cash for this if you’d like.

If your current bank doesn’t pay a fair rate for savings accounts (most don’t), then I would seriously consider opening an online account with a bank.  Here are 3 options I’ve heard good things about.  All 3 are high quality trustworthy companies from what I read and hear.  At the moment (Jan. 1, 2006), all pay around 4% for a standard savings account.

Frequently Asked Questions

Q: Should I pay off credit card debt before starting to save?

A: Any debt with a high interest rates should be your highest priority to pay off before savings. At some point I'll put together some educational info showing how damaging this could be if it didn't get paid off. Honestly, this probably goes for any debt over 6 or 7% interest.

But, I'll make another suggestion - that you DO actually start a physical savings jar and then a savings account and regularly put something into it, even if it's just $1 per week - or add to your total by not spending on some things. This starts to psychologically turn you into a "saver" instead of a "spender" which turns into a momentum activity just like weight loss.

Coming Soon!

Next I’ll add more information about the power of compound interest to this document.


Chris "SparkGuy" Downie
SparkPeople Founder & CEO