This year will be my 4th year of doing the savings challenge. Needless to say, the testimonies from other participants have been amazing. I noticed that some of my friends, who previously were struggling to put money away due to lack of discipline and/or commitment to their goal, managed to stay with the challenge. So I asked myself: How come?

I think it’s because the savings challenge encompasses all the key elements needed to achieve a set goal:

1. It’s written down; 
2. It consists of a series of small steps and it’s clear what to do;
3. There’s a timeframe attached to reaching the goal;
4. Accountability;
5. There’s a community of like-minded people who share the same goal;
6. There’s a commitment to completing the challenge;
7. And it gives a feeling of completion and accomplishment at the end. 

I think we can leverage goal-setting as a challenge to work towards any financial goal. We need to frame our goals as challenges rather than just having an infinite commitment. We need to look at our “pay myself first” goals as a challenge to complete.

A challenge is an opportunity

Late last year I saw a tweet that suggested that if you save R350 per month, compounding at an average of 8% p.a., it would take 40 years to reach a million. I didn’t verify if the 40 years will give you a million, as I was more interested in the principle. 

I thought this is a great opportunity to set up a second challenge for myself: The #R350InvestingChallenge. I’ve constructed a small cap portfolio using technical analysis to decide my buying and selling, and in which I will invest R350 a month. I have confidence that over a 40 year period I can achieve an average annual return of more than 8%. This means, at least in theory, that I’ll get to a million in fewer years. This challenge I will take on in bite-sizes, and one year at a time. I’ve also extended the challenge to a small trading account in which I will invest R350 monthly as well.

I like these challenges because they’re of the “two birds with one stone” kind, as I will also be challenging and developing myself as an investor and a trader.

So for 2022, I’ve set myself 3 challenges. You are welcome to join in the fun. Below are links to my journals for all 3:

#SavingsChallengeWithNjabs2022

#R350SmallCapsChallenge

#R350TradingChallenge

If you wish to participate, save a copy of the savings challenge spreadsheet and just change the “Increment multiplier” to suit your personal goals and savings capacity. Use the hashtag #SavingsChallengeWithNjabs2022 to share your journey.

Njabulo Nsibande is a Just One Lap user-turned-contributor and a founding member of an investment club. His “Cash Club” blog details his experiences balancing the financial obligations of a young parent with his investment aspirations.

Follow Njabulo’s journey here every month. You can also follow his trading journey by listening to his Village Trader podcast.

Find him on Twitter: @njabulo_goje.