It sounds straightforward in principle, but in reality, it’s far more nuanced.
Spending is woven into our everyday routines, from grabbing a morning coffee to unwinding at happy hour after work. We often treat shopping as a hobby when we’re bored, dropping hundreds with a few taps on our phone.
Even when we try diligently to adhere to a budget, it’s easy to get drawn into purchases that leave our savings depleted.
Sometimes the smartest way to disrupt those shopping habits is to undertake a spending freeze. A no-spend challenge can help you recalibrate your spending and fatten your savings.
What Is a No-Spend Challenge?
Despite the label, a no-spend challenge doesn’t require you to avoid spending money altogether. After all, you don’t want to fall behind on bills, and there are unavoidable essentials.
The basic idea behind a no-spend challenge is to eliminate non-essential purchases for a set period. That could be a week, a month or even a full year.
The aim is to significantly reduce your outflows so you can watch your savings grow.
What You Can Spend Money on During a No-Spend Challenge
If you must buy something during your no-spend challenge, it should be something essential you truly can’t do without.
So groceries, yes. Candy at the checkout, no.
Also, no new iPhone, even if you’ve been eyeing an upgrade. No new shoes, even on a steep sale. This isn’t the moment to rationalize purchases you don’t really need.
Consider these as acceptable purchases during a no-spend challenge:
- Groceries
- Toiletries
- Lightbulbs
- Batteries
- Toilet paper and paper towels
- Medication
- Doctor’s copays
- Gas
- Tolls
- Parking
You should also stay current on recurring bills. The goal isn’t to complicate your life by cutting out necessary expenses.
What you’ll be pausing, however, is discretionary spending in these areas:
- Entertainment
- Clothing
- Beauty
- Dining out
- Travel
- Hobbies
- Gifts
The Financial Benefits of a No-Spend Challenge
A no-spend challenge can provide a meaningful lift to your finances.
You can redirect the extra funds you’d normally spend into an emergency fund. You could use them to pay down debt. Or you might allocate the money to other objectives, like saving for a new car or an upcoming trip.
While no-spend challenges are intended to be temporary, you can always extend your timeline or — even better — adopt some of the habits as long-term changes.
Ideally, your no-spend interval will break bad spending patterns. Maybe skipping vending machine purchases at work will reveal you didn’t need them regularly. But be cautious not to deny yourself so severely that you binge-spend when the challenge ends.
6 Steps to Implementing a No-Spend Challenge
Committing to a no-spend challenge may feel intimidating, but don’t worry. These steps will help you stop unnecessary spending.
1. Figure Out When You’ll Do Your No-Spend Challenge
The new year might seem like a natural time to reset your money habits, but you can begin a no-spend challenge any time of year.
Choose a period when you don’t expect to need extensive shopping. If you have children, for instance, you may want to avoid back-to-school season or a child’s birthday month. Consider steering clear of major holidays (or adjust your rules to accommodate them).
2. Decide What Your No-Spend Challenge Will Look Like
There isn’t a single correct way to run a no-spend challenge. Tailor it to what suits you. Below are four approaches to consider, though you can also design your own variation.
Ban Spending for a Set Amount of Time
This is likely what most people picture when they hear “no-spend challenge.” It means avoiding all non-essential purchases for a defined period — commonly a month, though you can shorten or lengthen it to change the difficulty.
You might begin with a no-spend weekend or week if an entire month feels too intimidating.
If you find a month manageable, consider stretching it to two or three months.
Track No-Spend Days
An easier way to add a spending ban is to pick a certain number of days each month when you won’t spend. Start modestly with five days or aim higher with 15 days.
Monitor your daily spending so you can recognize — and celebrate — each day you don’t spend anything.
The benefit of this method is you don’t need to forgo spending for an extended stretch. You can scatter the no-spend days across the month so it feels natural, and you might barely notice the restriction.
Just be careful not to overspend on the days that aren’t designated no-spend days.
Target Your Weaknesses
You know where you tend to overspend. Maybe it’s clothing, takeout or impulse buys on marketplaces. This version restricts spending on a particular category or retailer instead of banning all discretionary purchases.
Since you’re only avoiding one or two categories — like makeup or video games — you may want to make the challenge longer than a month for more impact (and better savings). Try 90 days or even six months without indulging your particular weakness. (And don’t replace it with another costly habit.)
Freeze Spending During Special Occasions
It’s easy to splurge around special occasions. Try stopping discretionary spending around holidays, birthdays or other celebrations.
Challenge yourself to celebrate differently or start new traditions. You could commit to a year of homemade gifts. Or sift through your belongings to find items you can regift.
Volunteer with friends and family instead of exchanging presents. Or enjoy a free shared experience — like a movie marathon or a karaoke night at home.
3. Set a Savings Goal
Before launching your spending freeze, decide how much you hope to save during the challenge.
Review your budget or past bank statements to estimate what you typically spend on dining out, entertainment and other categories you plan to pause. Move that sum into your savings account.
Besides knowing the amount, it matters to understand why you’re doing the challenge.
Keeping the purpose of your spending freeze in mind will help you power through moments when you crave a latte or a night out. Whether you’re saving for a big purchase or aiming to eliminate debt, remind yourself of your financial goals to stay motivated.
Starting balance
Monthly contribution
Length of time
Months
Years
Annual interest rate
4. Let Others Know About Your No-Spend Challenge
Inform your spouse, partner or housemate about your plan before you start. Changing shopping habits can affect the people you live with. Hopefully they’ll support your reason for the spending pause and encourage you to stick with it.
You may also want to tell close friends or relatives so they understand why you might decline invitations or skip gift exchanges.
5. Plan Ahead
Some foresight can help you avoid spending during your no-spend challenge.
Stock up on staples so you don’t need to visit the grocery store as often. If you must go, make a list beforehand so you don’t fall prey to impulse buys.
Another effective tactic is planning meals. Meal prep reduces the temptation to order takeout after a tiring day.
6. Don’t Let Setbacks Ruin Your Progress
Cut yourself some slack if you slip and buy something you’d planned to avoid. Nobody is flawless.
Keep going with the challenge. Don’t let one misstep become an excuse to halt your savings momentum.
Tips to Avoid Spending Money During Your No-Spend Challenge
It’s called a challenge for a reason. Stopping habitual spending can be tough, especially when swiping a card has become second nature.
Here are practical tips to help you complete your no-spend effort.
1. Become Part of a Community
Joining others on a no-spend journey can help you stay accountable — whether it’s a circle of friends with similar goals or an online group where strangers share wins and setbacks.
2. Find Free Things
Scan Craigslist for free listings. Join your local Buy Nothing group, where neighbors give away items they no longer want. Ask your library what non-book items they lend out.
3. Find Free Activities
Not spending money doesn’t mean you must stay home bored. Fun doesn’t always cost cash.
Explore parks and trails, dive into a hobby, spend time with friends and family, or attend free local events to entertain yourself at no cost.
4. “Shop” at Home
Inventory items you already own but haven’t used. You may be able to make several meals from your pantry and freezer. Laying out your shoes could reveal you don’t need another pair. You might even find unopened cosmetics or clothes with tags still attached.
5. Swap, not Shop
Trade goods and favors with neighbors, friends and family without exchanging money. Host a clothing swap or trade children’s toys. Offer to babysit in exchange for a lawn mowing.
6. Avoid Temptation
Leave credit cards at home. Unsubscribe from store sale emails. Don’t go along with friends just to “window shop.”
Make it simpler on yourself by avoiding situations that tempt you to buy.
7. Keep a Wish List of Items You Want to Buy
If you feel the urge to purchase a non-essential during your no-spend challenge, jot it down on a wish list instead of buying it right away. After the challenge ends, review the list. With time, you may find many items no longer feel necessary.
Nicole Dow is a former senior writer at Savinly. Senior managing editor Tiffany Wendeln Connors updated this post.
