How to Take on a No-Spend Challenge
The most successful financial freedom journeys are the ones built on taking a hard look at the numbers and being honest about spending and saving habits.
Checking out online and in-stores is easier than ever with contactless payments, but is your spending outnumbering your budget? If you're getting packages at your doorstep every other day or driving to your local store often for online order pick-ups, this may be the perfect opportunity to explore a no-spend challenge.
A no-spend challenge is a commitment to non-essential spending for a set period of time. While we all need to pay for essentials like groceries, rent, and utilities, non-essential spending can be a budget-killer. Non-essential spending is different for everyone, but by reassessing your budget and prioritizing your needs vs. wants, you can get closer to achieving financial freedom.
Think you're up to the challenge? Here are six pro tips to help you reach your goal!
1. Stick to a set of rules.
Visualize your spending by writing down what you've spent during the last week and identify where you can make changes. When you're setting rules for your no spend challenge, be sure to make a note of when you're allowed to take a break during the challenge. Put a list of these rules in common spaces like your fridge, desktop wallpaper, or car to remind yourself to stick to the plan and avoid impulse purchases.
2. Set a reasonable time frame.
Determine the length of time you'd like to freeze spending. Start small with a day at a time, transition to a week, then a month if possible. You can even designate the challenge for weekends only first, then gradually add in the weekdays. By beginning the process with daily increments, you'll feel accomplished with quick wins and even move to a longer time frame.
3. Create an intentional plan for the money you save.
Every dollar you save from the no-spend challenge is one dollar more you can contribute to your financial goals. Consider using the money you're saving to build your emergency savings, pay down your debt, add to your retirement funds, or donate to your favorite organization. When you make this plan and stick to it, the money you save and the challenge itself will have a greater purpose.
Is building an emergency fund part of your plan? Park your savings with FAIRWINDS Emergency Savings, an account specifically designed for emergencies. Start by saving $1,000, and continue until you have at least three to six months of expenses saved.
4. Build a support system.
Similar to taking a group workout, completing the no-spend challenge with family or friends can keep everyone accountable of the progress and stay committed to the challenge. Even if you're unable to recruit a family member or friend, sharing your experience can inspire others to rethink their spending and research how the challenge can benefit their financial well-being.
5. Keep pushing forward and overcome roadblocks.
During your no-spend challenge, unexpected events may occur. You may also be tempted to ease the rules you set for yourself. Keep pushing forward and talk with your support system if you hit a roadblock to remind you of your goals and cheer you on. We'll also be rooting for you every step of the way!
6. Reflect and celebrate for completing your goals.
You did it! Once you've completed the challenge, assess your results by defining your successes and improvements. Don't forget to celebrate accomplishing the goals you've set for yourself and inspire others to spend less and save more using the no-spend challenge.