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Tip #4: Involve your friends in your savings challenge

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This is tip #4 of the Save $1,000 in 30 Days Challenge.

Today’s tip is to involve your friends and family in your money saving. Without this, you’ll have a tough time achieving your goals. For more people, the reason they fail to save money is not a lack of money-saving ideas — it’s themselves and their lack of discipline. By involving your friends, you eliminate that lack of discipline and give yourself automatic accountability and a built-in reason to win.


Let’s take a look at this question, which came in from my post about turning the thermostat down:

Anybody have any tips on how to do this with room mates if you and your room mates do not have the same goals? How do you talk them into wanting to put the thermostat down 3 degrees if it is going to possibly make them uncomfortable, or maybe they just do not want to substitute comfort for any dollar amount?

Great question — and it doesn’t just apply to saving money by turning your thermostat down. What about if you want to eat out less this month? Or go out less? How do you enlist the help of your friends?

Why your friends matter
Getting your friends involved is important because your spending is based on your context. A lot of us like to think that we make our financial decisions individually. What an American, determinist perspective! But it’s not true. Our spending depends on those around us. For example, if you make $50,000/year, you probably hang out with others who make similar amounts and have similar spending patterns. If your friends shop a lot, and you’ve been accepted into that group of friends, chances are you shop too. Social influence is extremely powerful

Think about it: When was the last time you spent money because of friends? For me, it was this weekend, when I ate out. It was fun, it was social — but it was also financial.

As you’ve been seeing from my tips over the last few days, the actual financial decisions are only a small part of your spending. A lot of it has to do with the psychology of spending. That’s why enlisting the help of your friends to achieve your goals this month is so important.

I want to point you to an astonishing study that highlights the importance of your social network. In this case, it was for obesity:

Obesity can spread from person to person, much like a virus, researchers are reporting today. When a person gains weight, close friends tend to gain weight, too.

The answer, the researchers report, was that people were most likely to become obese when a friend became obese. That increased a person’s chances of becoming obese by 57 percent.


“You change your idea of what is an acceptable body type by looking at the people around you,” Dr. Christakis said.

Fascinating. I can’t speak authoritatively to the correlation between obesity and finance, but I’ve seen lots and lots of patterns between the two (e.g., here and here). I think that intuitively, we all recognize that a lot of our spending is a result of our friends and the people in our social network. You think your spending would stay the same if you hung around a bunch of immigrants, or people who make $400,000/year? Not a chance.

How to enlist your friends’ help to save money
We’ve already talked about why it’s important to enlist your friends’ help to save money. Without their help, you’ll still have the constant pressure to go out, buy new stuff, spend, or whatever your current spending patterns are. In other words, it will be you against the world. To help change that, there are two approaches you can take:

1. Enlist your friends to join the Challenge (cooperative approach)
2. Bet your friends you can hit your goals (adversarial approach)

Enlist your friends to join the Challenge.
For the person above who wanted to know how to get his roommates to be cool with turning the thermostat down, this is the approach I would take.

Hey guys,

I read this personal-finance blog and he just announced a Save $1,000 in 30 Days Challenge. I don’t know about you guys, but I’m down to save $1,000. (Realistically, I think I can save $700 this month.)

Would you guys be interested in joining in?

If we can each participate, it would be a lot easier (e.g., we save on heat a little, clean the house ourselves, cook a little, and that saves hundreds right there). I took his first 3 days of tips and I’m already saving [$XXX].

What do you think?

Check out the 30 day challenge here:


The chief benefits of this is that you get (1) social support and (2) economies of scale. If you’re all saving towards a common goal, you can eat rice and beans, and you’ll also be more likely to turn down the heat, not go out as much, etc. Personally, I’m doing this approach.

Bet your friends you can hit your goals
You guys know I love bets. Sites like are great because they give you an easy way to motivate yourself by publicly committing to a goal. There are thousands of psychology studies about commitment — specifically, public commitment — which is highly persuasive. If you tell a group of people that you’re going to stop smoking, or lose weight, or save money, you’re highly motivated to save face and hit that goal.

I used this strategy successfully last year when I ran a weight challenge to gain weight. I’ve always been a slim guy so I decided to bulk up a little. I emailed my friends and got them involved: I bet that I would GAIN the weight, while I encouraged them to bet against me. I describe all the details in How I Gained 5 Pounds in One Week (check it out), but here’s the initial email I used to get my friends involved:

Email I used to bet friends for weight gain challenge

The text I’d use for the Challenge is something like:

Hey guys,

I read this personal-finance blog and he just announced a Save $1,000 in 30 Days Challenge. I’m taking the Challenge and trying to save $700 this month.

Now, who wants to bet me I can’t do it?

You can try anything you want — inviting me out to free meals, sending me sales, asking if I want to grab a drink. Whatever it is — do it. But you have to bet me $25, $50, or $75 that I won’t be able to hit my goal of saving $700 this month.

In other words: I bet you that I can save $700. You bet $25, $50, or $75 that I CANNOT save that much money. I’ll provide weekly updates so you can track my spending.

Let me know if you’re in by this Friday, November 7th.


The key is to get your friends involved, whether they join the Challenge or bet against you. Get your co-workers involved, too: At PBwiki, we’ve done a hot-sauce-eating contest and a Biggest Weight Loser challenge.

The result of getting your friends involved
For my weight-gain challenge, once I bet my friends, I actually started caring less about my weight-gain bet itself, and more about showing my friends that I could do it. Whenever I felt like I couldn’t do it (not ANOTHER glass of milk), I knew I had to or I would lose to my friends — and that wasn’t gonna happen. Finally, by having weekly check-ins, I knew I had to hold myself accountable each Sunday.

The same is true of saving money. For the challenge, my friends know I’m running this challenge, which means they’re open to hanging out at free places instead of expensive bars/restaurants this month. Plus, there’s the motivation aspect: If you set a goal of saving $300, or $500, or $1,000 this month, and you bet your friends publicly, you are GOING to find a way to make it happen. Don’t do this alone. Get others to help you and you’ll be even more successful. Start by leaving a public comment with your goal and name today.

Total savings: $100-$500

* * *

Last thing to do
1. Leave a comment on this post describing your name and what your goal is this month. Use this to hold yourself accountable. Each day, I’ll ask you to post how much you’ve saved cumulatively. Use this as a way to track your own progress (it will also encourage others to join)
2. Want to submit your own savings tip? Submit a money tip here.

If you liked this tip, check out my Premium tips — one long, tactical tip per week. Save money or get a 100% refund.


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  1. So far I’m having a bit of trouble with this challenge here. Besides the sell something on ebay (I sold a mini fridge I got as a gift 5 yrs ago for $50 on craigslist right after I posted the ad) I’ve already been doing this stuff.

    1. I make my own lunch everyday and have been for 2 years (I spend less than $10 a week on food for lunches)

    2. The temp at my house it set to 62 degrees during the day and 56 at night. Any lower than that I think is a bit ridiculous.

    3. I hardly go out with friends and spend money. We spend a lot of time staying in because we’re all trying to save money. (I did recommend this challenge to some of them and they are going to try it also.)

    I don’t really see myself saving anywhere near $1000 with the challenge. I am still hopeful and looking forward to seeing what’s coming up.

  2. Kevin, what sort of tips do you think would help you save $1,000 using the C.E.O. model (cut costs, earn more, optimize existing spending)?

  3. It would be nice to have accountability from friends during the challenge!

  4. Your credibility here went down with that obesity claim. OMG THE OBESITY EPIDEMIC BOOGA BOOGA BOOGA. You’re smarter than that, Ramit. Go talk to Kate Harding about the realities of that study before using it to compel people to save money.

  5. @ Kevin – I agree with Ramit, there has to be some else you can do to save money. The first four tips doesn’t apply to me either, but I’m sure I can think of other ways.

  6. Wow, tough crowd.

    Personally, I figure any suggestions I get that will help to motivate or remind me to save a few dollars is a positive. If I’m already doing these things (which I am) then it confirms that I’m on the right track and reaffirms my commitment to them. Nothing wrong with that.

    I’m also willing to give Ramit the benefit of the doubt and assume that he’s starting slow and will ramp things up as the days progress. We’re not all starting at the same place and it would be a tad arrogant of me to judge everyone by my standard of measure. I may be crying Uncle by the time November 20th comes around, or the entire month may be a breeze.

  7. Ramit good response to Kevin is certainly one that has been repeated and will need repeating through each day I’m sure.
    I’m really glad to see the tip of the iceberg of people like Kevin who showed up in mass on Tip 1.
    That actually encourages me that America still has real people out there and we do have what it takes to face no only a challenge like this but, also the challenges ahead in the coming years. I am certainly open to alternative suggestions from folks who find they are already into each tip. Maybe we will see some real hard cores out there who can make some killer tips that will help folks like Kevin who are already into it. Especailly a spin off of one of our already presented tips. It could really be fun. I save 100.00 to 150.00 dollars or more during winter months heating with wood. I have the tools and opportunity. Yes, I figured the other costs in. It may not be for everyone but, what is your unique opportunity?

  8. Thanks Coyote! you said it!

  9. Now here is a public commitment.

  10. I like these challenges. You don’t need to earn a whole lot of money to save $1000. I was able to save over $1000 in September, although I was only able to save about $400 in October. I net $2700 a month (plus health benefits) with my wife, so it’s not a terrible amount of money. Here’s some of the biggest reasons why I think we’re able to save:

    * Rent – We don’t have a house payment. We rent an apartment that pays for heat and water. Rent is $680.
    * Limit groceries to once a month – We’re forced to eat stuff we wouldn’t normally eat right off the top.
    * Lousy furniture – We have pretty lousy furniture and not much of it. But we deal with it because we want to save (particularly for a house).
    * Canceled digital cable – The broadcast digital stations come in pretty well. This saved $40.
    * Canceled land line – We use the internet/phone bundle. Yeah Comcast is lousy, but AT&T is much much worse.
    * Have no debt – This of course makes it a lot easier to save.

    Despite these “sacrifices” we still subscribe to Netflix, have plenty of clothes and go out to eat once a week (~$40 a week. This really needs to come down). We also have a dog. Of course, not everyone can do this but it’s not like you’re a bad person. The point is that it IS possible and it doesn’t hurt to try.