Name: Keep the Diff
Author: Lee

The usual answer is a percentage. Save twenty percent of what you earn and a thousand dollars takes however long twenty percent of your income takes. It is arithmetic, it is correct, and it has never once helped anybody, because the people asking this question are not people with a spare twenty percent sitting unspoken for.

Here is the other way to work it out, starting from decisions rather than income.

Start from the decisions, not the paycheck

In an ordinary week you talk yourself out of things. The takeaway you decided against on Friday, the jacket in the tab you closed, the store brand instead of the name brand, the second round you skipped. None of it is dramatic and none of it gets recorded, so it never feels like saving.

It is saving. What you were ready to spend minus what you actually spent is money you still have, and it is the money a thousand dollar goal is actually made of.

Three paces, and what each one costs you

Fifteen dollars a week. One takeaway skipped, or a couple of store brand swaps. That is sixty seven weeks, so a bit over fifteen months.

Forty dollars a week. A skipped takeaway, a coffee run you did not make, and one thing you decided against. Twenty five weeks, just under six months.

Ninety dollars a week. The above, plus roughly one real decision a week: a piece of clothing, a gadget, an evening out. Eleven weeks, so under three months.

The arithmetic is a thousand divided by your weekly number. That is the entire model, and the reason it works is that the weekly number is one you can check against your own life instead of guessing at.

Why a week and not a month

Nobody can estimate a month. Ask somebody what they spend on eating out in a month and the answer will be wrong by a factor of two, in either direction, with complete confidence.

A week is short enough to remember. Think about last week specifically: the things you nearly bought and did not. Add those up. That is your number, and it is a real one rather than an aspiration.

Do it with your own numbers

The savings goal calculator does this arithmetic for a goal of any size. Put in what you are saving for and what a normal week is worth, and it tells you the date. Nothing you type is sent anywhere and there is nothing to sign up for.

If a thousand dollars is not the goal, the shape is the same. Four hundred at forty a week is ten weeks. Three thousand at ninety a week is a bit under eight months.

What actually moves the number

Not intensity. Frequency.

A week where you go without everything is a week you will not repeat, and the total from it is smaller than you expect anyway. The weeks that add up are the ordinary ones with three or four decisions in them, repeated for months, which is a thing you can actually do.

Four things carry most of it for most people: food you were going to buy and cooked instead, a subscription or a delivery fee avoided, one clothing or gadget purchase reconsidered, and the cheaper version of something you were buying anyway. Watch those four and the weekly number roughly takes care of itself.

The catch, and the fix

The catch is that a decision you do not record did not happen, as far as your sense of progress is concerned. Saved money looks exactly like money you never had, which is why people who are doing well at this often feel like they are doing nothing.

So write them down. Two figures at the moment it happens: what you were ready to spend, what you actually spent. The difference is the Diff, and a running total of it is the only evidence this kind of saving ever produces. There is a full month worked through with real numbers if you want to see what a total actually comes to.

If the answer comes back too far away

Sixty seven weeks is a long time and there is no point pretending otherwise. Three things help, in order of how much they help.

Raise the weekly number by widening what counts, not by being stricter. Most people log only the dramatic decisions and miss the small swaps, and the small swaps are half of it.

Lower the goal to something twelve weeks away, hit it, then set the next one. A thousand dollars that arrives is worth more than five thousand that does not.

And check the number again in a month. The first week's estimate is almost always low, because you were only counting the decisions you noticed.

What this is not

It is not a budget. There is no allowance to set, nothing to go over, and no red number at the end of the month. It is a record of money that did not leave, written after the decision rather than before it.

Keep the Diff does the adding up, free on iPhone, iPad, Mac, Apple Watch, Windows and Android, with no account and no bank connection. The thousand dollars is the same thousand either way. The difference is whether you can see it arriving.

How long does it take to save $1,000?