How I Saved Over $10,000 in 3 Months During the Pandemic


My income, like that of many others, suffered during the first few months of the COVID-19 pandemic. Not only did my savings rate drop, I had to dip into my emergency fund for unexpected relocation expenses.

Once my income started to improve, I set a goal: Put my savings rate into overdrive to replenish my emergency fund, and get back in the habit of saving a significant portion of my income. In three months, I saved over $10,000. Here’s how.

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I kept my spending to a minimum as my income increased

When the COVID-19 pandemic hit, I lost about 50% of my income. I’m a freelancer, and my clients often cut back on my workload and put projects on hold when budgets are tight. That’s exactly what happened.

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So, for the first few months of the pandemic, I had to cut my spending accordingly. It helped that I could no longer travel, because that’s where a lot of my money normally went, and expenses like gym memberships and hair salon appointments were also cut due to safety precautions. On top of the necessary budget cuts, I also stopped shopping online and cut back drastically on grocery spending by making fewer trips to the store and limiting my purchases to what could fit into two reusable bags.

Luckily, my clients were in better shape within a few months, and I was able to resume most of the work I’d been doing pre-pandemic. However, instead of jumping back up to my pre-pandemic spending levels, I decided to keep my spending low through the rest of the year and funnel that extra money into my savings.

I set up automatic deposits into my savings account

Setting up automatic transfers into my savings account is easily the most effective mental trick for helping me boost my savings rate. There are a few different methods.

In the past, I’ve had my high-yield savings account automatically transfer a set amount from my checking account into my savings once or twice per month. Though this works well, I decided to try a new method that I think is responsible for the $10,000 boost in my savings.

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Since I have multiple streams of income from a handful of clients, I was able to set it up so an entire stream of income gets deposited directly into my savings account. This was a client who put our project on hold when the pandemic hit, so I’d already been going without that income for several months. When the client resumed the project, I submitted a new direct deposit form, asking the company to deposit my checks into my high-yield savings account.

Because these checks go straight into a savings account that’s completely separate from my checking, I don’t even see the money, so I’m never tempted to spend it. If you don’t have multiple streams of income, you can do something similar by setting up a percentage of your paycheck to go into your savings account, and the rest into your checking.

I split my savings into categories to help me track my progress

To keep myself motivated, I set up “savings buckets” within my high-yield savings account that allow me to split up my savings into categories based on my financial goals. For example, I have one named “emergency fund,” one named “new car,” and one named “self-care.” While this doesn’t directly boost my savings, it does help me track my progress and feel good about where my money is going.

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During August, September, and October, I saved $10,504. I made just over $20,000 in those three months, so my savings rate hit about 50%.

Most of that came from the automatic transfers I set up, although about $35 came from interest earnings, and about $330 came from a “surprise savings booster” feature I turned on that detects excess funds in my checking account and processes small transfers into my savings periodically.

Since my savings strategy is largely automated, it requires very little thought or action on my part after setup. It’s mostly thanks to these automation tools and mental tricks that I was able to save five figures in just a few short months.

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