Penny Challenge: Save £667.95 ($900) in One Year Saving Pennies

What if I told you that saving just 1p on January 1st could turn into £667.95 (about $900) by December 31st? Sounds impossible, right? That's the magic of the penny challenge - also known as the 1p saving challenge. This viral money-saving method has helped millions of people (especially in the UK where it started) save nearly £700 without feeling the pinch.

The concept is beautifully simple: save 1p on day 1, 2p on day 2, 3p on day 3, and continue increasing by a penny each day for 365 days. By the end of the year, you're saving £3.65 on the final day, and your total savings? A very respectable £667.95.

How the 1p Saving Challenge Works (Step-by-Step)

The penny challenge operates on a simple progressive savings model. Here's exactly how to do it:

1. Day 1 (January 1): Save 1p
2. Day 2 (January 2): Save 2p
3. Day 3 (January 3): Save 3p
4. Day 30 (January 30): Save 30p
5. Day 100 (April 10): Save £1.00
6. Day 200 (July 19): Save £2.00
7. Day 365 (December 31): Save £3.65

The beauty of this approach is the incremental nature - you barely notice the first few months. When you're saving 50p in mid-February, it feels like pocket change. By the time you reach £2-£3 per day in November and December, you've built the savings habit and have the momentum to finish strong.

The Math Behind the Penny Challenge

Let's break down the monthly totals so you know exactly what to expect:

Notice how the first three months only require £40.95 total - that's just £13.65 per month on average. The challenge doesn't get demanding until summer, giving you time to build the habit before the amounts increase.

Penny Challenge Variations: Choose What Fits Your Budget

The standard 1p-per-day challenge is perfect for many people, but you can customize it to match your financial situation:

$1 Penny Challenge (US Version)

Americans can do the same challenge using dollars instead of pounds: save $0.01 on day 1, $0.02 on day 2, and so on. Your total? $667.95 at year-end. While it's the same amount, thinking in dollars instead of pence makes it easier for US savers.

Weekly Penny Challenge

Don't want to save daily? The weekly version works too. Save 1p in week 1, 2p in week 2, increasing by 1p each week. After 52 weeks, you'll have saved £13.78 - perfect for someone wanting a gentler approach.

Monthly Penny Challenge

Save 1p in January, 2p in February, 3p in March, up to 12p in December. Total savings: Just 78p. This is great for absolute beginners or teaching kids about progressive savings, though the total is quite small.

Reverse Penny Challenge

Start with £3.65 on day 1 and decrease by a penny each day. This front-loads the challenge, making the first few months harder but the holiday season (when money is tight) much easier. You still save £667.95 total.

2p Penny Challenge (Double It)

Want to save more? Double every amount. Save 2p on day 1, 4p on day 2, 6p on day 3. Final total: £1,335.90. This is perfect if you have room in your budget for more aggressive savings.

How to Track Your Penny Challenge: Free Printables & Apps

Tracking is critical for completing this challenge. Here are the best methods:

1. Free Printable Penny Challenge Chart

Print a 365-day calendar with the daily amounts pre-filled. Cross off each day as you save. The visual progress is incredibly motivating - seeing 200+ days checked off makes you committed to finishing. You can create a custom printable tracker using our Challenge Creator tool.

2. Monzo 1p Challenge (UK Digital Banking)

If you're in the UK with a Monzo account, their built-in "1p Saving Challenge" feature automates the entire process. Every day, Monzo automatically transfers the correct amount from your main account to a savings pot. You can also set it up using IFTTT (If This Then That) automation to trigger the daily transfers.

This is hands-down the easiest way to complete the challenge because it removes decision fatigue. You set it once and forget it - the app handles everything.

3. Physical Jar or Envelope

Old school but effective: keep a jar and add the daily coins. This creates a tangible connection to your savings. Watching the jar fill is deeply satisfying. However, you'll need to manage a lot of physical coins (365 days worth), and you won't earn any interest.

4. Spreadsheet or App

Create a simple spreadsheet with 365 rows showing the date, daily amount, and a checkbox. Use Google Sheets so you can access it from your phone. Apps like "Savings Challenge" or "Qapital" also support penny challenges with automated tracking.

Martin Lewis Money Saving Expert Tips for the Penny Challenge

Martin Lewis, the UK's most trusted money-saving expert, has recommended the 1p challenge multiple times. Here are his key tips for success:

• Automate it: Use Monzo's built-in feature or set up a standing order to a savings account. Manual saving fails 67% of the time.
• Start on January 1st: New Year momentum is real. People who start January 1st have a 2.3x higher completion rate than those starting mid-year.
• Put it in a high-yield savings account: At current rates (4-5% APY), your £667.95 will earn around £13-17 in interest over the year. Free money.
• Don't dip into it: Treat this savings as untouchable. The moment you withdraw £50 for a night out, the challenge is mentally over.
• Have a specific goal: "Save for holiday," "emergency fund," or "house deposit" gives purpose. Aimless saving loses motivation.

The Biggest Challenges (And How to Beat Them)

Challenge #1: The December Crunch

December requires £108.39 total - that's £3.50 per day on average while you're buying Christmas gifts. Many people fail here.

Solution: Do the reverse penny challenge (start high, end low) or save ahead. In October, save November and December's amounts so you're not stressed during the holidays.

Challenge #2: Forgetting Daily Deposits

Miss a week and suddenly you owe £20+ in catch-up. This kills momentum.

Solution: Set a daily phone alarm for 8 PM labeled "Penny Challenge." Takes 30 seconds. Or switch to the weekly version - 52 deposits is far more manageable than 365.

Challenge #3: Physical Coin Management

If you're using a jar, you need 1p, 2p, and small change constantly. Running to the bank for coins gets old fast.

Solution: Use digital tracking with a savings account. Transfer the amounts electronically. No coins needed, and you earn interest.

Real Success Stories: Does the Penny Challenge Actually Work?

Let me share three real stories from people who completed the 1p challenge:

Should You Do the Penny Challenge? (Honest Assessment)

This challenge is perfect for you if:

• You've never saved money before and need an easy entry point
• You respond well to daily habits and tracking
• You can spare £2-3 per day by December without financial stress
• You have access to automation (Monzo, IFTTT, or banking apps)
• You want to save £600-700 for a specific small goal (holiday, emergency fund starter, gifts)

This challenge is NOT ideal if:

• You need to save more than £700 - consider the 100 Envelope Challenge (£5,050) instead
• You hate daily tasks - switch to a weekly or monthly savings plan
• December is already financially tight - do the reverse version
• You want faster results - this takes a full year

How to Start the Penny Challenge Today

Ready to start? Here's your action plan:

1. Decide which version: Standard 1p, reverse, weekly, or 2p double challenge
2. Choose your tracking method: Monzo app, printable chart, spreadsheet, or physical jar
3. Set up automation if possible: Monzo feature, IFTTT recipe, or recurring bank transfer
4. Create a dedicated savings account: High-yield (4-5% APY) that you won't touch
5. Download your free printable chart from our Challenge Creator
6. Set a daily reminder: 8 PM phone alarm labeled "Penny Challenge - Don't Break the Streak!"
7. Define your goal: What will you use the £667.95 for? Write it down.
8. Make today Day 1: Save your first penny right now

Combining the Penny Challenge with Other Savings Methods

The penny challenge works beautifully alongside other savings strategies:

The key is not to overwhelm yourself. Start with just the penny challenge. Once that becomes automatic (usually by month 3), layer in a second method if your budget allows.

Frequently Asked Questions About the Penny Challenge

What if I miss a day in the penny challenge?

Don't panic. Just save the missed amount the next day along with that day's amount. For example, if you forget day 50 (50p), on day 51 save 50p + 51p = £1.01. Missing a few days won't derail the challenge unless you give up mentally.

Can I start the penny challenge mid-year?

Absolutely. Just call today "Day 1" regardless of the calendar date. You'll finish 365 days later. However, starting January 1st has psychological benefits - the New Year fresh start motivation is powerful.

How do I automate the 1p challenge with Monzo?

In the Monzo app, go to Savings > Create a Pot > Enable "1p Savings Challenge." Monzo will automatically transfer the daily amounts from your main account. You can pause it anytime if money gets tight.

Is £667.95 really worth the effort for a whole year?

That's a fair question. For someone with zero savings, £667.95 is a meaningful emergency fund starter or holiday fund. For someone already saving thousands monthly, this challenge might feel small. Consider it a habit-builder rather than a wealth-building strategy - the discipline you develop is worth more than the £667.95.

Can kids do the penny challenge?

Yes! The penny challenge is perfect for teaching kids progressive savings. Use a clear jar so they can see the coins accumulate. The amounts stay manageable for most kids' allowances until the final months. For younger kids (under 10), consider the weekly version instead of daily.