Have you ever heard of the No Spend Challenge or financial freeze? Basically, you stop spending money on any and all unnecessary purchases for a set amount of time. You can do a several weeks or even a whole month. Sounds crazy, I know, but it’s a powerful challenge to help you get on track with your finances.
My husband and I participated in a No Spend month a few years ago and it was life changing for us. I realized I shopped too often and was draining the budget a few dollars at a time. During that month, we found ways to entertain our kids and ourselves without spending a dime and got creative in the kitchen to use up what we had.
You can set up your No Spend Challenge however you want, but I recommend eliminating ALL unnecessary purchases. The only things we allowed ourselves to purchase were dairy, produce, diapers, and toilet paper. Everything else was off limits. Yes, this seems extreme, but there are some great reasons you may want to consider a financial freeze.
What are the Benefits of a No Spend Challenge?
Have you ever heard of those detox programs for your body? A No Spend Challenge is a detox for your finances. If you are beginning a journey to become debt free, budget better, or save more money, a financial freeze can get you started on the right path.
Halts out of control spending
Not sure where your money goes every month? Stop the spending to change your habits. It takes 21 days to form a new habit, so a financial freeze of at least that amount of time, can help you develop a new habit of spending less.
Uncover spending problems
Most people do not realize how much they spend on the little things. You know, those $5 lattes or $10 lunches that don’t like such a big deal. However, if you buy those daily, that adds up to $5,475 over the course of a year. That is some serious dough. A few dollars spent here and there doesn’t seem like much, but add it up over time and you will be shocked.
With a No Spend Challenge you will be banking all the money you would spend in a normal month. This can help you build an emergency fund, pay off bills, or save money for a rainy day. When my husband and I did our challenge we banked an extra $750 that month!
Find creative solutions
Since you can’t spend money, you are forced to find alternatives to things you buy or do regularly. Maybe you barter for items you need or find a friend you can help you. We used clippers to cut our son’s hair instead of going to a barber and made homemade Valentine’s Day cards for the kid’s school parties (obviously, our No Spend month was February.)
Discover new DIY recipes
You would be amazed at how many things can be made with simple kitchen ingredients. Shampoo, conditioner, lotions, and even cleaning supplies can all be made with a few basic ingredients for a fraction of the cost. During the financial freeze, challenge yourself to find alternatives to your commonly used items.
Clear out your fridge and freezers
I was amazed at how much food I had in my house. During the No Spend month, I challenged myself to use up ingredients we had on hand. I got creative with the meal plan and used up some of the food that might have otherwise gone to waste.
Spend more time with family
During the No Spend Challenge, we got creative with family fun. Since we weren’t spending time shopping, we had more time to spend with family and friends. We used our memberships to the local zoo, forest, and museums. We geocached together (my kids love these treasure hunts) and spent more time together.
If an entire month of No Spend seems too overwhelming, try a week or even just the weekends. If you work a regular day job, most money is spent on weekends, so challenging yourself to spend nothing on weekends can have a positive impact on your finances. Don’t be scared to try a No Spend challenge. It is hard, that is why it is called a challenge. However, the benefit are numerous and can help you get back on track financially. For more information on budgeting, paying off debt, and taking control of your finances, check out my book ‘The Extraordinary Art of Budgeting’.
I won’t lie, those 28 days of our No Spend Challenge were hard, but it was so worth it. I made lifelong changes in how often I shop (I shop less often now) and discovered new places to visit with the family on a budget. It was an experience that continues to have an impact on our shopping habits, spending, and financial views.
Have you done a No Spend Challenge? Share your experience in a comment.