A NerdWallet survey found that more than a quarter of Americans (26%) have ever attempted a No Spend January, and 12% of Americans started No Spend January this year. That 12% includes me.
Despite its name, No Spend January doesn’t mean not spending any money for a whole month. Most people have bills to pay and mouths to feed — regardless of their New Year’s resolutions. The challenge involves cutting out nonessential spending for 31 days.
Four years ago, I embarked on my first No Spend January. In fact, I actually cut out nonessential spending for 12 months in order to keep my finances in check during an expensive year that included adding a second kid — and a second car — to our household. Since then, I flex my no-spend muscles by doing No Spend January (and No Buy July) every year.
Here’s how I participate, what I’ve learned over the years and how you can do it, too.
My why and my rules
My reason for doing no-spend months is twofold: I save money and I avoid buyer’s remorse from impulse purchases (at least for two months out of the year). The latter has a bigger impact on my life. In a culture where gratification is never delayed, I think it’s good practice to not indulge my every purchasing whim.
There’s a reason I choose January and July specifically; they’re my most expensive bill months, due to biannual auto insurance and quarterly water bills. And while I could opt to save money in a sinking fund each month in anticipation of these semiregular costs, cutting back on spending works for me.
My No Spend January rule is pretty simple. I don’t spend on things that aren’t necessities. That means no hobby spending, no clothes, no toys for my kids, no household decor and no solo takeout. I also have an exception to my rules. My oldest kid’s school holds a Scholastic book fair every January, and I allow myself to buy two books for her and one for her classroom.
Identify your why and set rules
Your why and rules may look totally different from mine, and that’s OK. Maybe you have a specific savings goal or you’re trying to break some bad spending habits. Perhaps you’re abstaining from spending only in one category — like clothing or books — or cutting out everything except for gifts for your partner’s January birthday.
Figure out what a successful No Spend January (or February or September) looks like for you and do it your way.
The habits that help me succeed
With many no-spend months under my belt, I’ve learned a few things. Here are some habits that I employ regularly throughout the year, but are particularly helpful when I’m not spending on nonessentials.
1. ‘Wishlist and wait’
If there is one piece of wisdom I can impart to those who regularly fall prey to the siren song of impulse shopping, it’s “wishlist and wait.”
Sometimes I really want something. I mean, I really want something. And I’m sure I’m going to continue to want that thing until I have it. So I put it on a wishlist and wait a month before purchasing it. And then I magically don’t want it anymore.
Putting time between wanting and purchasing something is the best trick I’ve learned to avoid buyer’s remorse. Allowing the novelty to wear off before committing significantly decreases the purchases I follow through with.
Try it: Every time you find yourself wanting something, write it down instead of buying it. If you’re doing a no-spend month, revisit your list when the month is over. Or if you aren’t, decide on a timeframe in which to consider the purchase — maybe a week or two — before buying.
The goal of wishlist and wait isn’t to keep you from ever buying things. You may decide after the waiting period is up that you still really want that thing. Great! As long as you can afford it, go ahead and purchase. But you might find once the shininess of a new thing wears off, you’re free to cross it off your list and hang onto your money for something better in the future.
2. Avoid the revenge spending trap
A no-spend month isn’t quite as effective if you double up spending in the next month. This hasn’t been the case for me — wishlist and wait is effective — but if you’re worried that abstaining from spending in January will lead to a Feb. 1 binge, prepare for that ahead of time.
Try it: Calculate roughly how much you spend on nonessentials during the month. Then, take that amount upfront and transfer it to savings, put it toward debt or invest it, whatever makes sense for your financial goals. If you aren’t sure about your monthly spending, or it varies, you can do the same at the end of the month with any money left over from not shopping. That way, you won’t just defer that spending to the following month because it’s already been allocated to a more responsible place.
3. Revel in what you already have
I’m a lover of hobbies, particularly reading and crocheting, which I do on a near-daily basis. But during my no-spend months, I focus on reading the books on my shelf and crocheting with the yarn in my stash, instead of making new acquisitions. And it’s freeing.
When I don’t have the guardrails of a no-spend month, it’s easy to justify a book here or a skein of yarn there. Having a set period of time where my only option is to use what I already have gives me new appreciation for my belongings and a sense of accomplishment as I watch my TBR (to be read) shelf and yarn stash dwindle.
Try it: Let’s say your primary nonessential spending is on new clothing items. Try using a no- spend month to get creative and put new outfits together with your existing wardrobe. You might also use the time otherwise spent shopping to clean out and reorganize your closet to make your current clothing options more appealing. If clothes are “your thing,” you probably have a lot of great pieces to appreciate.
Why I keep doing No Spend January
It can be uncomfortable to stop shopping, particularly for those who are used to making regular nonessential purchases.
When I did my no-buy year, I quickly realized that not seeing packages on my porch was denying me little dopamine hits that I had become accustomed to. But instead of breaking my no-buy commitment in order to avoid that discomfort, I decided I needed to sit in it. I didn’t want my happiness to be dependent on consumer goods being delivered to my home on a regular basis, and I still don’t.
By taking regular breaks from buying nonessentials, I can remind myself that I’m not just a consumer. The things I buy are not the person I am, and the same goes for you. There’s much to be gained by taking a step back from shopping, and the money saved may be the least of it.
More From NerdWalletIs Giftflation Blowing Up Your Holiday Budget? Here’s How to Fight It.Data: Americans Spending Less Time, More Money on Shopping
Erin El Issa writes for NerdWallet. Email: erin@nerdwallet.com.
The article Why ‘No Spend January’ Has Become My Annual Tradition originally appeared on NerdWallet.
