The £5 note challenge is simple: every time you get a £5 note as change, you put it aside instead of spending it. There are no calculations and no daily targets, just one rule tied to something that already happens.
It works because change feels like a windfall rather than part of your budget, so it is easier to let go of, and because the habit is triggered by an event (receiving a fiver) rather than by willpower. How much you save depends almost entirely on how often you pay with cash, so the totals below are worked examples, not averages.
How the £5 note challenge works
Pick a home for the notes, such as a jar, an envelope or a money box. Whenever a £5 note lands in your purse or wallet as change, it goes straight there. If you slip and spend one, carry on with the next one rather than giving up.
Some people speed things up by paying for small purchases with a £10 or £20 note so they get more fivers back. That is fine as long as you are not buying things you would not otherwise buy just to get change.
The maths: how much could you save?
These are illustrations based on the number of notes you put aside each month:
| Notes a month | Per month | Per year |
|---|---|---|
| 2 | £10 | £120 |
| 6 | £30 | £360 |
| 12 | £60 | £720 |
| 20 | £100 | £1,200 |
If you mostly pay by card you will be at the lower end. People who are paid tips or cash in hand, such as hairdressers, drivers and tradespeople, can save far more. Moving the notes into an easy access savings account adds interest on top; see our savings accounts guide for how to compare rates, or plug your own numbers into the savings goal calculator.
Where to keep your £5 notes
A jar is satisfying to watch fill up, but cash at home earns nothing and can be lost or stolen. A good middle ground is to collect notes until you reach £100 or so, then pay them into a savings account. Many banks and building societies let you deposit cash at the Post Office, which helps if you do not have a branch nearby.
Keep the amount held at home small, and check whether your home insurance covers cash and up to what limit.
Variations if you rarely use cash
If notes rarely pass through your hands, the same idea works with other triggers:
- £2 coin challenge: save every £2 coin you get in change.
- Mixed change: save every £5 note and every £2 coin.
- Digital fiver: move £5 to savings each time you buy a coffee or takeaway by card.
- Daily amount: put a small set amount aside every day instead; SYM tells you how much to save today and one tap logs it, so you can keep a streak going without cash.
What to do with the money
Decide on a goal before you start, or the jar tends to get raided. Good options include:
- An emergency fund, if you have little set aside. Our emergency fund calculator helps you pick a target.
- Christmas or a holiday, so the cost does not land on a credit card.
- Paying down expensive debt, where every extra pound saves interest. Try the credit card payoff calculator.
- A longer-term pot, such as a house deposit, where small sums add up over years.
Making it stick
Give the notes a fixed home so the habit has a visual cue. Tell someone what you are doing if accountability helps. Mark milestones like £100 and £500 with a small treat paid for from other money. Being more aware of your change also tends to make you more aware of what you buy, which is a useful side effect.
How much can you save with the £5 note challenge?
What if I rarely use cash?
Is it safe to keep £5 notes at home?
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