Evaluate Your Spending
Before you start your month of no spending, take a look at your monthly expenses. Review your checks, bank statements, and bills. Then, categorize your expenses into necessities and extras – the latter are what you will temporarily live without during the challenge. Next, create a written budget so you can plan for a month without spending.
Most necessities will be very clear: your rent or mortgage payment, minimum monthly debt payments, groceries, medications, and insurance. Similarly, you may find spending categories that you can do without, such as dining out or ordering food, nail care, or impulse buying online late at night. These categories should be added to your spending list.
There may be other things you can forgo if necessary, but they may not be worth cutting entirely. For example, it might be possible to spend $8.99 a month on a basic Netflix subscription and consider it worth it because it provides you with hours of entertainment and helps you avoid spending money on other things, like more expensive movie tickets.
Why Not Spend? Set a Goal
Cutting extras from your budget won’t be easy. You need a reason not to spend that money if you want to stay motivated. So before you start, set a financial goal and write it down.
“Saving more money” may not be a good goal because it is too vague. Instead, use the SMART goal format: your goal should be specific, measurable, achievable, realistic, and time-bound.
Here are some examples of SMART goals: adding $100 to your emergency fund in one week by cutting unnecessary spending, reducing your credit card balance by $500 in one month through a frugal February challenge, and saving an additional $1,000 for a down payment in 30 days by cutting all extras from your budget.
Note: Research indicates that setting specific and challenging goals actually leads to higher performance and more positive outcomes. So if a month of no spending with a saving goal of $500 seems like a tough challenge, you may find it ultimately more rewarding.
Don’t Do It Alone
A month of no spending doesn’t have to be a month without fun. Try to involve others – your partner or spouse, children, or friends – in the no-spending challenge as well. You can not only hold each other accountable, but you can also come up with ways to not spend money together.
For example, if you and your spouse have a date night once a week at a restaurant, you could make cooking together at home every Friday your date night instead. Instead of meeting friends for happy hour at a bar, you can take turns hosting happy hours at home on Wednesdays.
Be Prepared for Bumps in the Road
Don’t expect everything to go smoothly when you commit to a month of no spending. Unexpected necessary expenses may arise. Don’t be too committed to your no-spending month that you avoid going to the doctor or refuse to take your car to the mechanic despite the check engine light being on. Take care of yourself and address the challenge later.
Also, accept that you may slip up during your month of no spending – it’s okay. Let’s say you ordered food instead of cooking after a long day at work. Give yourself a break. You haven’t failed your challenge. Remind yourself of the goal you set, whether it’s saving more money or getting out of debt, to motivate yourself and get back into no-spending mode.
Note:
If you have spent money on non-essential items during your no-spend month, look for ways to cut back on necessities to make up the difference. For example, you might freeze your gym membership and exercise at home instead, or search for more coupons that can help you save money at the grocery store this week.
Track Your Progress
During your no-spend challenge, track your progress. A budgeting app can help you monitor how much money you are spending and saving. But to stay motivated and create lasting habits, you might want to go further.
If you are a visual person, consider downloading or creating debt payoff or savings charts that you can color in each day. This will help you see how much you have accomplished. Pinterest and sites like DebtFreeCharts.com can be good places to find these charts.
You can also keep a journal, especially when you are tempted to spend. Think about how you are feeling in that moment. Are you feeling stressed, tired, or anxious? Write it down so you can reflect on and learn from the situation.
If you have asked someone else to join you in the no-spend challenge, try to set a time to check in each week, like every Saturday morning at your home over coffee. You can share your victories and failures and how you feel.
Note: To keep your spending under control, try thinking about purchases in terms of hours worked instead of dollars. For example, if you earn $20 an hour at your job, a wallet costing $100 is equivalent to five hours of work. Is it worth it?
Conclusion
A month without spending can help you save more money or reduce debt – but it may not be suitable for everyone. You might find that a better approach is to make smaller, more permanent cuts to your budget.
If you tried the no-spend challenge and decided it’s not for you, that’s okay. Focus on your long-term goals, such as saving for retirement, building an emergency fund, or paying off high-interest debt. There is no one-size-fits-all strategy to achieve any of these financial goals.
A no-spend month will look slightly different for everyone. You can decide how far you are willing to take it. If you tried the no-spend challenge and it didn’t go perfectly, focus on the victories, no matter how small. Every extra dollar is a step in the right direction.
Source: https://www.thebalancemoney.com/no-spend-month-to-save-money-5211714
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