The dawn of a new year is the perfect opportunity to make alterations to enhance your finances over the forthcoming 12 months. And that is especially true if you’ve already found it difficult to stick to your Christmas budget. One of the simplest savings tricks involves setting aside pennies each day, which gradually build up into pounds as the year unfolds.

By sticking to the ‘1p savings challenge’, you could accumulate a handy savings pot worth £667.95 by December 31, 2025. Even if you only saved until the end of November, you would still have tucked away an impressive £559.45, which could alleviate the pressure of purchasing presents next Christmas.

The ‘1p challenge’ – as it’s widely known – is probably one of the easiest and most recognised ways to grow your money pot for winter 2025. It’s also a fantastic way to cultivate the habit of saving every day by starting small and concentrating on the final result.

The best part is that because the daily savings amount in January won’t significantly dent your finances, you can easily catch up or start at the end of the month instead – all you’ll need to do is set aside £4.96. The only downside to this savings scheme is that the amounts increase as the year advances.

It might be beneficial to know the amounts due per month and set the money aside as soon as you get paid. Here’s how the penny challenge works, reports the Daily Record.

1p challenge monthly savings plan

To kick off the savings challenge, you simply need to start by setting aside a penny a day. This amount gradually increases over time, so by the end of the year, you’ll have saved a tidy sum to start 2026 with a few hundred pounds in your pocket.

Although the challenge officially begins on New Year’s Day with just 1p, it’s easy to catch up throughout January due to the small amounts involved. You start by saving 1p, then 2p, then 3p a day, right up to £3.66 on the last day of December.

If you stick to this plan, by December 31, 2025, you will have saved a total of £667.95. Here’s a simple daily savings plan to follow: Day 1: Put in £0.01, Day 2: Put in £0.02, and so on.

From Day 100, add £1.00, and increase by 1p each day. On Day 200, double the amount to £2.00, and again increase by 1p each day.

Continue until Day 300, when you should put in £3.00, and increase by 1p each day thereafter. Alternatively, if it suits your financial situation better, you could reverse the order in which you save.

This would entail saving £108.50 in January, with the amount gradually decreasing throughout the year, culminating in a December payment of £4.96.