There's no surefire way to amass savings quickly. Even the most successful wealth managers don't have a magic formula for consistently doubling $100 overnight, let alone turning it into $500. But there are plenty of smart ways to grow your nest egg over time. Here are five strategies to reach your $500 goal.
1. “Find" Money and Increase Your Savings Contributions
Start digging through those sofa cushions—or better yet, through your monthly expenses—and find a little extra money to squirrel away each month. Saving just $42 a month will get you past your $500 goal within a year, not including any interest you might accrue with a high yield savings account.
A mindful approach to your spending may reveal simple ways to quickly grow your savings. For example, at one estimated cost of $3.77 per cup,1 you can easily save that extra $42 per month by forgoing three cups of java per week from your local coffeehouse. And preparing meals at home a couple of times a week rather than getting takeout or delivery could save you between $50 and $120 a month.2
Remember, money won't save itself. Establish a savings account and set up automatic transfers to capture that extra cash.
2. Create a Designated Savings Account
Once you've determined a way to set aside funds regularly, it's time to consider where you'll put your savings. While some savers like to see their money accrue, others prefer the “out of sight, out of mind" mentality to keep savings safe. If you're in the latter category, open up a new savings account designated specifically for growing that $100 to $500. You can even give the account a fun name! This bucketing strategy for savings can help you stay focused and goal-oriented in your approach.
3. Take an Interest in Your Interest Earnings
If your money is sitting in your checking account, it's probably not earning much interest, if any. Moving it into an interest-bearing savings account, certificate of deposit (CD) or money market account will help grow your dollars incrementally while giving you access to those funds if an emergency arises.
For instance, let's say you start with $100 and then add $33 per month for a year. With no interest, you'd end up with $496. But in a savings account with an APR of 4.75%, you would have $510.39. And the benefits get better and better the more you're saving and the longer you save.
| Year |
Contribution |
Future Value (4.75% APR) |
| Year 0 |
$100 |
$100 |
| Year 1 |
$496 |
$510.39 |
Look into online banking options, which often provide competitive interest rates and lower fees. You won't amass your $500 goal overnight, but interest is about growing over time or compounding. The longer you save, the more your money can earn interest.
4. Rethink Your Risk Quotient
Yes, taking a seat at a blackjack table in Vegas or buying scratch-and-win lottery tickets might quadruple your cash in a flash—but odds are, you'll lose it all. If you're comfortable taking a calculated risk, however, there are plenty of ways to increase your savings without going broke. Investing your money in stocks, municipal bonds or mutual funds can generally provide an even greater return on investment than FDIC-insured savings accounts.
Typically, the riskier the investment, the greater the possibility of building (or losing) your fortune, especially in the short term. That's why higher-risk investments are often recommended for longer-term goals like retirement, not for cash you'll need in the next year or two.
Don't want to risk it all? Diversifying your portfolio between savings accounts and investments can provide a balance for short- and long-term gain. Consult a professional financial advisor to find out the best options for you.
5. Invest in Yourself
A staggering 65% of Americans are living paycheck to paycheck, making saving for the future more than challenging.3 And while good budgeting skills and cutting spending are useful tools to help you manage your money, sometimes the best solution to help you save more is to increase how much you earn.
If you're looking for an investment that can provide immediate and long-term returns, look no further than building equity in your No. 1 resource: you. Consider investing some (or all) of your $100 seed money into learning a new skill online that can increase your income right away—and into the future. In fact, high-income skills like data analysis, user experience or project management have the potential to significantly boost your earning potential.4
Already have a talent and an entrepreneurial spirit? Invest that $100 in your side gig. Spruce up your vehicle and take a turn driving for a rideshare service. Invest in graphic design software and turn your artistic talent into a part-time venture as a freelancer. Purchase social media ads promoting yourself as a dog walker, house cleaner or babysitter. Or set up your own retail shop on one of the many online marketplaces to sell your used or handmade goods.
Yes, You Can!
Wealth won't happen overnight. But for a minimal cash outlay, you can create a sustainable means to turn that $100 investment into far more than $500.
Ready for more smart tips on how to make your money work for you? Read these 7 money management tips for your peak earning years.
