This post is by our regular contributor, Erin.
Have you ever participated in a no-spend challenge before? Has the idea intrigued you? Or did it scare you away?
As you might guess, a no-spend challenge involves not spending money…but it doesn’t have to mean you stop spending all your money in one go.
You can choose to stop spending money in “trouble” areas like restaurants, groceries, or clothing, or you could choose to go all out and impose a total shopping ban on yourself, aside from necessities.
You can hold the challenge for a week, a month, or a whole year. It’s up to you.
If you’re on the fence and you’re considering a no-spend challenge, there are a lot of benefits you can reap by participating in one.
My Not-so-Normal Experience With No-Spend Challenges
I have to admit, I haven’t done a no-spend challenge in the traditional sense, but that’s all the more proof there’s no one definitive way to do it.
There was only one thing I ever intentionally stopped spending money on. A few years ago, as I was reviewing my expenses, I realized I needed to stop spending so much money on beauty related things. It was getting a little out of hand.
Literally any time I went into Target or Walmart, I would find myself browsing the cosmetics aisles. After amassing quite a collection of makeup, I knew I had to start spending my money more wisely.
I didn’t declare myself to be on an outright “beauty products” shopping ban, but in my mind, I committed to only buying things when I needed them…and I haven’t looked back since.
In the non-traditional sense, when I moved, I decided to be much more intentional about what got brought into the apartment. I was amazed at how much stuff I had managed to acquire over the past few years, and now that I’m moving again, I’m hyper-aware of it.
So I didn’t go on a shopping ban per se, but I got majorly turned off to knick-knacks being around my place. If anyone suggested buying me something that wasn’t functional, I wanted nothing to do with it. I value my space; I don’t value things. My spending naturally aligned with that, and my bank account has profited!
Anyway, enough about how I’ve benefitted from “no-spend” challenges. Let’s talk about how you can get use them, especially if you’ve discovered a bad spending habit that you want to get rid of, or you’re in credit card debt!
1) No-Spend Challenges Save You Money
Obviously, the clearest benefit to challenging yourself not to spend money is that you’ll be saving it!
However, you need to make sure you’re taking action with the money you’ve saved. It’s one thing to stop spending $3 everyday at a coffee shop, but if you spend it on a snack at the vending machine at work, you’re not doing yourself any favors.
Each time you don’t spend money, try to remember to keep a tally of it. Transfer the money you’ve saved to a specific savings account you set up for the challenge.
Having a goal for your money will help, too. Are you going to use the money toward debt? A vacation? A new computer? Give yourself a little extra motivation to succeed!
2) No-Spend Challenges Uncover Spending Triggers
I think the biggest benefit to no-spend challenges is that you’ll likely figure out exactly why you have the spending problem you do.
For example, maybe entertainment expenses are super high for you, and you’re trying to cut back on that by finding fun, free alternatives.
But every time you’re tempted to spend on entertainment, you’ll have to stop and tell yourself “no, not while the shopping ban is going on.” At the same time, you might question why you feel the need to spend.
Is it because your friends are going out, and it’s a good way to spend time with them? Are you afraid you’ll miss out on something?
In any situation, you should figure out what action you need to take to develop better spending habits. Perhaps time with friends is something you simply value enough to spend money on, but you realize you prefer an intimate potluck dinner as opposed to going to a comedy club. Or maybe you realize staying in once in a while isn’t as bad as you thought.
3) No-Spend Challenges Force You to Use What You Have
I find this to be very true when it comes to groceries, stuff that gets sent to the garage/attic/shed/closet, and clothes.
I actually hate grocery shopping. I really do. This sometimes works to my advantage, because I will try to empty out my freezer, fridge, and pantry to delay going.
Instead of shopping, I ask myself what kind of meals I can string together so I can go out tomorrow (or next week) instead. You might be surprised at what you can do with all the food you have when you’re desperate!
On the “stuff” front, I’m willing to bet many of us have bought something we already had, at least once, because we either forgot about it or couldn’t find it. It’s the worst feeling to come home and then magically find what you need hours later.
Clothes? Forget it. I have a closet and drawer full of clothes. I also happen to hate shopping for clothes, so I’ve focused on buying classic, plain pieces of clothing that I can mix and match and create new outfits from easily.
In all of these cases, putting yourself on a shopping ban means you need to get creative and resourceful. You’ll have to use what you already have in your home (or closet) to “survive” the next week or month or so.
4) No-Spend Challenges Make Values Clearer
Should you choose to do a total no-spend challenge, or critically evaluate your spending to see which areas you struggle with, you’ll probably get clearer on what you value in life.
There are so many things we spend on without question because it’s simply automatic. A friend of mine once told me a coworker of theirs stopped at McDonald’s every day for the same exact breakfast. They never skipped a day. It was just their routine.
Well, having a no-spend challenge will definitely disrupt your normal routine, so much so that you’ll have to question your spending decisions. That’s not a bad thing, because you look deeper into what makes you happy.
Maybe you’ll come to the conclusion that spending on coffee, clothes, makeup, etc. doesn’t actually bring you the happiness you thought it did. You clearly don’t value them enough, then. Instead, you should start focusing your spending on your values, so that you’re spending money on things that will make you happy.
A No-Spend Challenge is a Great Way to Get Your Finances in Order
Again, no-spend challenges are whatever you make them to be. You don’t have to follow anyone else’s rules. This will work better when you personalize it.
Some people freak out trying to imagine going a month without grocery shopping, meanwhile, I’ve seen many people complete that challenge successfully. It’s all about getting prepared beforehand.
You shouldn’t make the decision to do a no-spend challenge on a whim. Carefully consider the implications, your limits, and other life circumstances. For example, if work is going to be insane for you for the next month, perhaps you’re better off delaying until things calm down.
Either way, I think everyone should do a no-spend challenge in some area of their financial life at least once. It’s very insightful, and if done correctly, will prove useful for years to come. At the very least, you’ll have the confidence to know you can do it after going through it once!
Have you ever completed or set a no-spend challenge? What were the rules? How long did it last? Do you think no-spend challenges are a good idea?