Saving $4000 in 2 months is a huge task and will require one of two things to be true for you to accomplish it:
- A high income with a large amount of monthly discretionary spending
- Things you can sell that you don’t need to raise money
- A side hustle
When it comes to saving money in a short period of time–you’ve only got two places to attack: outgo and income.
Before going any further–give some thought to which side of the equation you can attack given your current situation.
I’ll break this post down into two groups: Folks with a relatively high income, and those with more modest incomes. For each group, I’ll lay out the strategy I would take for each.
Saving 4 grand in 2 months with high income – travel is killing you
High income earners tend to suffer from lifestyle creep that keeps most of their income going into various expenses that seem small by themselves, but add up to a large monthly outlay.
Travel tends to be one of these items.
When I was younger and broke, I used to travel on a shoestring budget. I would take the cheapest flights–or even better I would drive and just pay for the gas for my car.
Back then, gas was pretty cheap.
I’d stay with friends in each new city I’d visit to say money on lodging costs. I’d go to the local grocery store and by pre-made food like those whole chickens that you can buy. Walmart used to have them for 4 bucks.
I’d hardly spend any money at all traveling actually–besides the extra gas money to get up there.
As my income increased, I noticed my frequency of traveling staid the same–but got a lot more expensive.
Instead of driving my old car around, I’d take flights.
I’d travel to cities with no friends, so I’d have to pay for a hotel/
I’d eat at fancier restaurants and do more of the touristy crap that people do. If friends were around, I’d treat everyone out and some of the dinner bills were enormous if it was a large group.
Long story short, I spent a ton of more money on a random trip than I used to–and this would add up pretty quickly.
In the summer of 2021, I spent thousands on travel in a relatively short period of time (3 months or so).
Now, I enjoyed myself and I’m glad I did it–but I could have saved a lot of money on some of those trips with a bit more common sense.
If you’re a high income earner, chances are, you could save a significant amount of your goal of $4,000 by scaling back your travel budget for a minute.
Your life won’t be over–I promise you’ll survive staying home for 6 months straight while you get that money saved.
When I had credit card debt and was maxed out on my credit cards, I was stuck at home and pledged that I would not travel until I had that sucker paid off.
It took like 8 months for me to pay off around $5000 in debt–but I did it (on a very low income).
So check out your travel expenses–and that includes all the uber trips and restaurants out during the trip. Chances are you’ll find thousands of dollars spent there.
Outside of travel–another spot where high income earners can look to save a large amount of money in short period of time is restaurants.
Restaurants are eating your 4K dream alive
I like eating out as much as the next guy–but man it adds up so fast and burns a lot of money every month if you’re not careful.
At my peak of restaurant activity, I was spending close to $400 per month just at restaurants. I’m not kidding. And some people spend a lot more than that.
Grabbing lunch out daily doesn’t seem like a big deal when you’re making a lot of money. But try multiplying that daily lunch by 20 and see what that number looks like. Now add in dinner out with the family twice per week.
Before I got married, eating out wasn’t a huge deal. When I got married and it became two people eating out instead of one–boy did that get expensive fast.
Run through your budget and add up all the trips to get food that weren’t your kitchen–I bet you’ll find a thousand dollars that just floated out of your life.
Tighten up!
Here’s some example numbers we can work with to see how close we get to our $4K goal. I’ll use some of the numbers from my own life as an example:
| Category | Cost Savings (Monthly) | |||
| Restaurants | $400 | |||
| Travel | $1500 |
That travel number seems insane–but that’s approximately what it was for me before I sat down and started actually adding it all up. It was a ton.
Looking at these two numbers, eliminating these two items got me approximately $1900 per month in savings.
Over the course of two months, that get’s us a savings of $3800 in 2 months–just about hitting the goal we set for ourselves.
Again, stuff like this works if you have a high income, and have a high amount of discretionary spending.
If you’re more middle class on the income spectrum–we’re going to have to get a lot more creative when it comes to savings $4K in a two month period (2K per month).
Saving 4000 on a middle income – you are not what you drive
Boy, let me tell you something. I’ve driven some old cars over the years and I’ve loved every one of them just the same.
I remember some of my peers drove around cars that their parents bought them–or they have to pay whatever the monthly payment was on them.
Typically, whatever high school job they had was just enough to pay for the payment, gas, and insurance. But we had WHEELS! Freedom.
Problem is, a lot of people age into real adulthood and find themselves on the same car payment hamster wheel they we had when we were in high school, with too much of our income going into our cars and not enough going into our pockets.
Dave Ramsey calls the car payment a mantra of the middle class.
I think we need to attack that thing so you can save some money.
Let’s look at some basic numbers.
According to the Census Bureau, the median household income in 2021 was $70,784. The median car payment in the US is around $500 for used cars and somewhere between 664 and over 700 for new cars (depending on who’s numbers you look at).
No matter how you slice it–you’re crushing yourself if you’re making around 70K per year, but spending 10% of that gross number on an “asset” that is going down in value.
We’ve gotta get rid of that payment if you want to get serious about saving large amounts of money on a moderate household income.
If you’ve had your car for awhile, you likely have some equity in it. Sell that thing and use the equity in it to buy something for cash.
If you can take a step down in car for a couple of years, you can free yourself from this hamster wheel for life and get back into something nicer later once you have the money for it.
Not all groceries are created equal when you need to save 4 grand
Spending 800 bucks or more per month on groceries? You’re likely leaving some savings on the table if you’re not shopping at a discount grocery store.
Bring your own bags and leave the frills at home. You’ll get used to it, and you’ll get used to buying goofy-sounding no-name brand groceries when you see the difference in the bill at the checkout counter.
You could find an extra couple hundred per month just by shopping at a different store.
When income is the problem–not saving
When I was younger and making barely enough to pay my basic expenses–there was no way I’d be able to save $4K in just 2 months.
I would have been lucky to hit that number in a year–maybe even 2 years.
I didn’t really have a spending problem, I was just not making very much money at all.
I had more of an income problem–not a spending problem. I spent most of my time (when I wasn’t having fun) coming up with things I could do to sharpen my skills and earn more money.
That was time more well spent than trying to clip coupons or find an extra couple bucks in my budget somewhere.
If you’ve done all of the steps above and cut back on the car and the grocery bills, you’re likely sitting somewhere around $800 to $1K in extra savings per month–but we’re only halfway to our 4K in 2 months saving goal.
To bridge the gap–that’s where we need to look at the income side of things.
Good luck out there and stick with it!