How this entrepreneur saved $10,000 in three months and what it means for her now

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Kaila Jefferson wants to start over in a new city.

Jefferson, 28, lives in Norfolk, Virginia, after earning his master’s degree in 2020. She decided to move to Atlanta, which she believed would lead to more career opportunities for her as a young black professional.

A month after moving to Atlanta, Jefferson found a full-time job in her field as a speech-language pathologist. But between grad school and the cost of moving, she has drained her savings. Amid the uncertainty of early pandemic lockdowns and a mounting wave of job losses, Jefferson knew she needed to restock her savings.

“Since I live here alone, I’ve always wanted to save some money for emergencies or whatever,” Jefferson said. “Just to get myself back on my feet [after] I finished graduate school. ”

So she set a goal: She would give herself three months to save $10,000. Here’s what she does, and her advice for anyone starting their own savings journey.

how she was saved

The first thing Jefferson did to increase her savings was to limit her spending.

She replaced her regular nail and hair appointments with at-home treatments. Instead of going out to eat, she ate more meals at home and started meal prep. And when she does go out with friends, she sets aside a certain amount to avoid overspending.

But cutting costs alone isn’t enough to achieve her lofty goals. What really brought Jefferson to $10,000 was more income and a consistent budget.

Multiple sources of income

While Jefferson’s full-time job started her savings journey, she boosted that with the extra money she was able to bring in from a side hustle. With her passion for skin and hair care, she started creating content online and even launched a skincare brand. One of the best ways to start a side hustle is to start with something you already love and are good at, experts say.

“For me, it comes down to finding what I love to do and what I love and figuring out how to make money out of it,” Jefferson said. “These are things I’m naturally good at and decide to share with other people.”

Her greatest success comes from her YouTube channel, where she posts everything from her natural hair journey to DIY tutorials on body butters and scrubs. Jefferson estimates the videos bring in about $700 to $1,800 per month, which is an essential ingredient in achieving her goals.

“Having more than one source of income is the biggest key to saving so much money in such a short period of time,” she said. “It’s a lifesaver.”

If you’re interested in starting a side business or turning your passion into a second income, check out NextAdvisor for more expert tips and tricks:

budget ahead

Increasing her income was important, but it wasn’t the only factor that helped Jefferson achieve his goals.

Even after cutting costs as much as possible, Jefferson says her monthly expenses add up to nearly $2,500 a month—and that doesn’t include savings. So she started planning every expense and budget.

After setting aside $1,250 a fortnight to cover rent, utilities and other expenses, she’s saved about $2,000 between working full-time and the money she makes from YouTube. Any extra money she brings in will also go towards savings. Although her side income isn’t as stable as her full-time income, it does help bring her total monthly savings to around $2,000 to $4,000, she said.

But as they so often did, emergency expenses threw Jefferson’s plans into trouble. While saving, she also covers unexpected medical bills and car repairs. Fortunately, the extra income she saved helped her cover the costs, and her already diligent budgeting ensured she was prepared. She said Jefferson was able to cover those expenses with two months of YouTube earnings and funds she had set aside. In this way, her goals did not flinch.

Choose the right savings account

Instead of putting all her money in a traditional checking or savings account, Jefferson opened a money market account (MMA), where she put it aside to reach her $10,000 goal.

A money market account is like a hybrid savings and checking account – you have access to your funds anytime and you will earn variable interest. The main difference between money market accounts and high-yield savings is that MMAs typically offer check-writing or debit card access, and may also have higher minimum balance requirements.

[READ MORE: The best high-yield savings account rates available today]

“I don’t have a financial advisor, but I do now, so I’m learning how to make this money work better for me,” Jefferson said. “I think it’s about doing your research and figuring out what works best for you.”

Experts recommend choosing the type of account that best matches your financial goals and the traffic you’re looking for. Compare interest rates and account requirements (including fees, minimum balances and withdrawal limits) to choose the savings option that works best for you. Options such as high-yield savings accounts or money market accounts offer more liquidity and flexibility than Series I savings bonds and certificates of deposit, which require you to lock up your funds for a period of time to earn returns.

Goal over $10,000

Between her multiple sources of income and consistent budgeting, Jefferson hit her $10,000 goal in three months. After that, she gave herself more spending freedom but set another goal of saving another $5,000 over the next nine months.

In total, Jefferson said she saved $15,000 in a year and a half.

Since reaching her initial bold savings goal, Jefferson has continued to grow her YouTube channel and her business while still working full-time. With her emergency fund intact, she now uses the extra funds for long-term goals and debt repayments, including credit card balances and $180,000 in student loans.

But she’s still sticking with her initial savings as an emergency fund in case of additional unexpected expenses — especially as a business owner still adjusting to a new city. “It feels good to know that if something does go wrong, I have the financial means to deal with it,” Jefferson said.

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