Is It Possible To Swing a No-Spend Year? Financial Experts Weigh In

Wide shot of millennial couple lounging in their living room, planning out their finances and looking at their account via online banking.
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It may seem daunting at first, but according to financial experts across the country, a no-spend year is manageable. Despite its name, a no-spend year does not actually mean that you aren’t allowed to spend any money. A no-spend year means that you do not spend money on anything except the essentials. 

To achieve a no-spend year, you first need to understand the difference between essential and non-essential purchases. Essentials would be things like your rent or mortgage payment, car loan, utilities, transportation costs and food. Non-essentials would be anything extra such as entertainment, dining, and clothes. 

However, as our experts point out, completely restricting non-essential spending may do more harm than good. Allowing yourself a little wiggle room and setting achievable goals can help you change your spending habits for the long run.  

Set Long-Term Goals

The first key to a successful no-spend year is establishing why you want to do it. Ask yourself what you are trying to achieve and why. Jeremy Wagner, a financial analyst at Trading Pedia, says a no-spend year is “definitely doable, with a little planning and discipline.” He recommends focusing on long-term financial goals, “like paying off debts or building up your emergency fund.” 

Putting your reasons in writing can help you stay on track. Whether you have one goal or several, going back to your “why” may help you stay off Amazon or skip the Starbucks line.

Know Your Spending Habits

If you don’t know where your money is going, you will have a hard time cutting back. Jennifer Spinelli, founder and CEO of Watson Buys, suggests tracking your spending. Whether you want to use an app or write out your budget manually, it will help you understand how you spend money. 

Make Your Money Work for You

From there, you can choose areas to reduce or eliminate spending if it isn’t necessary. Spinelli notes that unnecessary spending includes things like “dining out, shopping, and entertainment.” The money you save can then be put toward other things.

Automate to Save

Spinelli also advocates automating your savings, “This can be done by setting up a budget and linking it to your checking account.” Making it an automatic process, say with each paycheck, can help you stick to your plan and, as Spinelli says, “reduce your overall spending and make it easier to save money.”

Avoid Being Too Restrictive

Jake Hill, CEO of DebtHammer, recommends that people take a more manageable approach when deciding to cut back. He compares it to dieting stating, “developing realistic healthy eating habits will prove much more successful and easy to adopt in the long-term than trying to stick to a highly restrictive diet.” He suggests finding the areas that you can cut back and then reducing instead of completely eliminating, such as eating out only two times per week instead of five.

Do a Shorter No-Spend Term

If a year seems too overwhelming, you may also want to consider trying a no-spend month. Just working to stick to a budget and getting out of the habit of impulse buying, even for a short period, can help you make better financial decisions.

Help yourself by setting realistic goals that you can achieve. You can set your own rules for your no-spend year, month, or week. The big picture is making smart choices that build the foundation for a solid financial future. 

Choose Activities Wisely

You may be surprised how much you spend on entertainment. The good news is that there are many free or inexpensive ways to have fun. Wagner encourages “hiking, visiting a museum, or going to a movie matinee.” He also suggests taking “advantage of free events and concerts in your community.” 

Make Your Money Work for You

Eat In Instead of Out

Almost all experts agree that eating out is one of the largest unnecessary expenses that can quickly be reduced. Eating out is not only expensive, but it can also be unhealthy. By cooking your own meals, you can save money and calories. There are lots of tips and tricks, including buying in bulk and prepping meals for the week.

The consensus among financial experts seems to be that a no-spend year is reachable for those that are willing to make adjustments and stick to a budget free from excess. Even slight changes to your lifestyle can go a long way in helping you achieve financial stability.

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