Are you an impulse spender? It turns out you’re not the only one. Millions of Americans make unnecessary purchases every day. Each year, consumers spend an average of $5,400 on impulse buys. Evidently, frivolous spending adds up and can quickly bust your budget if you aren’t careful.
Keep bad habits in check and build your bank account with a no-spend challenge. This is a resolution to only spend money on necessities for a predetermined period of time and choose which items are unnecessary before you begin. Then, commit to the challenge and break shopping habits for good!
No-spend challenges can last from a week to 30 days, can be full or partial — choosing what to cut back on — and can be taken on within a community or on your own. However you choose to go about it, use the following principles to tackle any shopping habits you’re unhappy with.
1. Save More Money
Of course, one of the best things to come out of a no-spend challenge will be the extra money in your savings account. Even if you only commit to the challenge for a week, choosing to save instead of spend can have a huge impact on your budget.
This intentional frugality will also give you the opportunity to reassess your budget and make permanent changes that can help you achieve more long-term financial goals. Seeing the small gains made from a no-spend challenge can motivate you to incorporate more long-term habits that lead into significant savings over time.
2. Identify Triggers and Bad Habits
A no-spending challenge can help you identify bad habits and triggers as well. For instance, if sale items and psychological pricing tempt you to spend your cash, you can take a step back and recognize these tactics as marketing schemes.
Make a note of every time you’re tempted, like at the grocery store or when you see an online ad. At the end of the challenge, look back at this list and reflect on whether any of these items were things you truly wanted.
You’ll avoid stocking up on any unnecessary items throughout the challenge. More importantly, you’ll become more aware of your spending and saving habits over time, allowing you to make conscious decisions about which items are truly worth your money.
3. Share Your Goals with Your Loved Ones
As long as you’re committing to saving your hard-earned cash, you might as well tell the world. Keep yourself accountable by letting your family members and friends know about the challenge. Better yet, invite them to join you on this financial journey.
Research from the American Society of Training and Development indicates that having an accountability partner makes you 65% more likely to complete a goal. You’ll feel obligated to follow through and actually refrain from spending. Sharing in community support and communicating your goals is a great step to success.
4. Delete Saved Payment Information
Credit and debit cards are convenient and easy to use, making impulse purchases incredibly tempting, especially when you're shopping online.
If you frequent certain sites that store your payment information, delete your profile or remove your credit card from your account during the challenge. This way, you’ll have to get up and find your card if you want to make a purchase. Often, the hassle of finding your card number will give you enough time to re-think an impulse buy.
5. Make Game Plans for Social Events
Many people tend to spend more money when they’re out with friends. It’s hard to have frank conversations about expenses when you’re worried you might be a downer. In these instances, it helps to have a plan in place before you show up at a get-together or head to a restaurant.
Create a small discretionary budget for dining and entertainment. If you struggle with restraint, keeping this budget in cash can help you hit a hard limit when you might otherwise be tempted to dish out on more than you planned. You can also look up menus or ticket prices beforehand and decide what you’ll prioritize in the moment.
No-spend challenges can make this harder, but it also gives you the opportunity to open up to your friends. You might even suggest alternate get-together ideas to help everyone save a little money, like an at-home barbecue or movie night. Having fun without spending money can help your social circle rely less on dining out and more on creating fun memories.
6. Track Spending and Urges
Another great way to discourage spending is to keep track of everything you purchase during the challenge. Write your expenses down in a journal or use an app or spreadsheet to gain a better understanding of where and how you shop. Chronicling your thoughts and feelings will help you become more aware of the reasons behind your reactions so you can respond differently in the future.
The no-spend challenge lets you put these insights into action. It can show you how meaningful extra expenses really are to your quality of life. Are you embarrassed by how much you spend on coffee, lunches, or movie tickets each month? See what life looks like when you cut back for the duration of the challenge. You might find that eliminating one purchasing habit doesn’t affect your happiness at all.
Treat Yourself (Wisely)
Motivate and inspire yourself to keep going — or even take on another challenge — by rewarding yourself at the end of the month. Celebrate your accomplishment with a reasonable treat, like a tool set or a blouse you’ve been eyeing.
This reward should be sensible and meaningful to remind you that you can do difficult things and achieve your goals. The no-spend challenge isn’t meant to be a punishment, after all — it’s a tool that can help you assess your habits and change what motivates you to spend.
Evelyn Long is a real estate and personal finance expert. She is the editorial director of Renovated and regularly contributes to Rental Housing Journal, National Association of REALTORS® and other web publications.