We are starting the New Year with a “No Spend January” month. Sounds a bit over the top, but it sports several great benefits. Saving money is obvious, but it also forces you to evaluate your spending habits and often changes them even if it’s just slightly. It will also likely cause you to be healthier and potentially lose some weight.
We have done No Spend January three years in a row now and it’s a great way to pay off credit card debt, add to savings, or just generally identify patterns in your spending. I have done this once before and it was an interesting experience. When I tell people that I am doing no spending month people often ask what it is and are interested in the details. Most people want to try it. Most people could use it to save some money.
Since so many people seem interested in the idea, I thought I would elaborate a little bit on it.
The broad idea is to quickly put the brakes on spending, and save your money. Additionally, it’s a great time to identify waste. Small purchases tend to add up quickly, and sometimes you don’t even realize you’re doing it sites. The habit is so ingrained that it just happens. When you are doing no spending and you reach for your purse or wallet to pay you should stop and think about the purchase you are about to make. This will likely happen frequently at first as you begin to realize the number of frivolous expenses you have.
A simple example would be a Starbucks latte every morning. Just eliminating this for a month could add up to $150 in savings. For me, it was an Amazon Prime shopping habit. I liked to buy $20 – $30 items pretty regularly without much thought adding up to hundreds very quickly.
No Spend January Rules
The rules of No Spend January are pretty straightforward. To put it simply, if it’s not a reoccurring bill or something you need to get to and from work (i.e. gas for your car), you’re not allowed to spend on it.
Things that are ok
- Mortgage/rent payments
- Credit card payments
- Medical Expenses
- Emergencies (obviously)
Things that are “not” ok
- Coffee Shops
- Movies / Movie Tickets
One of the most important things we try to stick to is planning all our meals. Eating out is a large expense for many people, even though they have a home full of food that is not getting used.
We shoot for one grocery store trip every two weeks and plan for this in our case using an app called Paprika, however, it could just as easily be done using good old pen and paper.
If you have your meals pre-determined it’s a lot easier to stick to making them. Also if you get smart with it one meal’s leftovers can roll into the next day's meal or be used as a work lunch the next day.
So that’s all there is to it. At the end of the month, you should come out with a pile of money and a new outlook on spending.
It’s all a lot easier than you might think. Give No Spend January a shot!
Here are a few more links to people who also do the no-spend month or challenge as some call it with all sorts of variations.