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One of the popular Frugal/FIRE challenges out there is the “No Spend Challenge.”
Although I have never participated in one, or plan to, it is an interesting concept.
I do think it is a great exercise in order to determine what truly is necessary or not in your monthly burn rate.
For those staring at a mountain of debt this is vital so that you can trim the fat off your household expenses and hopefully continue it for longer than the typical month this challenge requires.
The following submission is from a loyal reader who happens to be an attorney who wanted to discuss how to approach and succeed in the No Spend Challenge.
Do you want to save money each month but struggle to do it?
It is tough. Especially when the holiday season comes and people are spending the most.
But, you need to figure out a way to repay any holiday debt and manage your finances efficiently.
How about taking up a no-spend month challenge?
Are you amazed at how this is even possible?
Well, let’s put it this way, you’ll spend money only on essential items like groceries, gas, medication, utilities, etc.
For an entire month you won’t spend money on anything else.
However, when I say a no-spend month, it doesn’t mean that you’ll default to using credit cards.
This would defeat the purpose since you will have to repay the bills the next month or repay the balance along with interest.
Here are a few tips for a month of financial fasting.
Determine how long you can complete the fast
It is always better to take the no-spend month challenge.
But, if you think you can’t commit to a full month, try starting with a no-spend week.
Once you’re able to do it, try extending it to 14 days and then try it for a full month.
Do not be too hard on yourself.
It is better to proceed gradually.
Decide which categories you’ll temporarily stop spending in
Certain necessities, such as utilities and food will not apply to the challenge.
However, if you’re starting with a no-spending week, then you can buy your essential food items for a week so that you don’t have to buy anything.
If possible, plan your trips so you can avoid filling your gas tank as well.
You can even try carpooling to the office to save gas and money.
However, you need to stop spending in nonessential categories.
So, look at your budget and categorize your nonessential spending.
Understand the difference between needs and wants
This will help you when categorizing nonessential spending.
For a no-spend month, you need to distinguish between your needs and wants.
As already mentioned, you’ll have to spend on your needs like food and other essential things.
But, you will have to curb your wants.
If you feel the urge to buy anything, you’ll have to wait for a month.
Remember, if you swipe your credit cards you’ll just have to pay the bill the next month.
Think of it this way: Using credit cards means you’re still spending in that month.
So, resist the temptation of buying anything.
How will you distinguish your discretionary or nonessential items?
For example, wants may include online shopping, eating out, etc. that you can do without for a month.
Find a reason to do it
Ask yourself: why do I want to do a no-spend month?
You need a reason to stay motivated.
It might be that you’re saving to make the down payment on your home, saving for a vacation, etc.
You may also need to save money to pay off debt.
To repay debt, you need to save a substantial amount every month and choose a debt elimination plan to follow which you can repay within a definite time.
Take the challenge with friends or family
It is often difficult to tackle the challenge alone.
So, plan it with your partner, family, or a group of friends.
This will keep you motivated.
You can talk about your progress in the no-spend challenge and encourage each other every step of the way.
You can take it one step further and talk about your journey on social media.
This way you’ll feel motivated to succeed in your mission.
Who knows? You may inspire others to take up their own no-spend challenge.
Get prepared beforehand
Make sure you mentally prepare yourself for your no-spending days.
Create a plan for how you’ll modify your lifestyle without spending on non-essential items.
For example, you may need to prepare your lunch to take to work every day instead of going out to eat.
Also, be prepared to brew coffee at home.
You can also use the remaining groceries at your home instead of buying anything from outside.
When you run out of something, be creative and substitute it with what you have on hand.
Be careful not to over buy beforehand since you’ll go on a no-spend weekend.
If you over spend before you start, then it will be pointless taking the spending freeze challenge.
Find a distraction
When you are engaged with doing something you love to do, you won’t be bored and won’t feel the urge to spend on nonessentials.
So, choose a hobby to pursue during this time to act as an engaging distraction to prevent spending temptation.
Make a note when you don’t spend
Write down when you feel the urge to spend, but you successfully resist.
By journaling your progress, you can analyze where you can cut expenses in your budget.
At the end of the month, calculate how much you’ve saved.
This will motivate you to do spending freezes more often.
Don’t worry if you’re not able to succeed in a full month without spending.
Even a week should be counted as a success.
Just take the time to understand why you couldn’t pursue it for a month, so you can have better results next time.
With practice, you can succeed in your spending freeze mission for an entire month.
Another great idea is to follow a spending freeze week every month if a full month just isn’t possible.
You can still save a substantial amount of money.
All you need is focus and dedication to curb your spending on other days, allowing you to save a considerable amount every month.
This will set you up to have a better financial future.
About the Author:
Lyle Solomon has considerable litigation experience as well as substantial hands-on knowledge and expertise in legal analysis and writing. Since 2003, he has been a member of the State Bar of California. In 1998, he graduated from the University of the Pacific’s McGeorge School of Law in Sacramento, California, and now serves as a principal attorney for the Oak View Law Group in Los ALtos, California.
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Enjoyed the post. I did a no spend challenge for a month last year and actually found it wasn’t too bad. I stopped going to Starbucks and stopped looking at Amazon. I really found that the stuff I was purchasing was not essential and not necessary. I think it was easier last year since we couldn’t travel and really couldn’t go out and eat. It helped my budget but it helped my weight too.
That is impressive will power, quarantine or not. I am an Amazon junky myself and not sure I could be off for a month. It is nice that you found out what is important and what is not and the weight benefit is a bonus for sure. Have a great one.