Monzo 1p savings challenge: How users could automatically save up to £667.95 in a year | Personal Finance

Monzo is a challenger bank which has fast-become a way in which plenty of Britons are using to keep track of their spending – and saving. Perhaps that’s down to the spending reports or the ability to send money to friends with ease – or maybe it’s the coral pink card which has drawn customers in.

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Those who are using Monzo may also have seen the app-based bank has addressed the ability to take part in the 1p Saving Challenge without the need for customers stashing aside coppers themselves.

The principle of this challenge is saving a little money each day, and this starts with 1p.

It rises to two pence the following day, and on day three, three pennies must be put away.

On the final day at the end of the year, the amount a person needs to set aside is £3.65 – or £3.66 during a leap year.

Should the savings challenge have all gone to plan, savers will then have a total of £667.95 set aside – or £6.71.61 during a leap year.

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Monzo bank account: Woman using mobile and calculator and diary

Monzo bank account holders may opt to automatically save via the 1p savings challenge (Image: GETTY)

The savings challenge can also be done in reverse – with the amount saved decreasing by one penny per day.

As such, on the final day, reverse challengers would have to save just one pence.

But, physically putting loose change into a savings jar could prove to be more of a challenge for some – particularly those who tend to opt for card payments.

According to new research by PayPal, one in five no longer carry any cash – with PayPal suggesting that 10million Britons have dropped the habit of having loose change on their person.

The research found an additional 3.7million people (seven percent) no longer use a wallet.

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For Monzo customers looking for an automatic way of carrying out the challenge, there may be an option.

Earlier this year, Monzo explained how customers could set up the automated 1p saving challenge with Monzo.

This can be done by heading to the 1p Saving Challenge on IFTTT, and tapping “Get Started”.

Customers would then need to log into Monzo and agree some terms, and then choose which pot they would like to put their savings in, before pressing Save.

Then, the money will be moved into the chosen pot each day automatically.

Monzo: Man using mobile banking in pictures

Monzo is one of a number of challenger banks out there (Image: GETTY)

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Alternatively, it may be that savers who do not bank with Monzo opt to manually move their money into a savings account each day via their online or mobile banking.

There is another type of savings challenge which some people may opt for – such as setting aside £1 each week.

Another challenge offering a way to save is to save £1 on a Monday, and £2 on Tuesdays. The amount rises by £1 as each day goes on, ending at £7 on a Sunday.

This means that within £28 is set aside each week, if all goes to plan.

After 52 weeks, the saver should have £1,456 saved.

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Monzo: 1p Savings challenge in pictures

Monzo: The 1p Savings challenge is something which some may opt to do in order to save over the year (Image: GETTY)

For those who opt to use banking apps, there are a number of autosaving apps out there, as Money Saving Expert founder Martin Lewis pointed out during Good Morning Britain last week.

“There’s lots of these auto saving apps coming out. People really like them, loads of people ask me questions about, ‘are they safe or not,’” he said.

“The answer is they’re good, the interest isn’t that good, and they’re relatively safe but not as safe as a savings account.”

Explaining how they work, he continued: “What auto saving means is they have an algorithm that looks at your bank account and sees how much money you can put aside and automatically does it for you.”

The Money Saving Expert has said on the matter: “It’s a great way to get into the savings habit, though some of them don’t pay decent interest, in which case every few months move your money out to a normal savings account to ensure you earn.”