If you’re prone to impulse spending and often find yourself with less money to spare than you’d anticipated, a no-spend challenge could be just what you need to refresh your spending habits.
Spending money is unavoidable, so a no-spend challenge isn’t about spending no money at all.
It’s about not buying non-essentials with the aim of exploring your relationship with money, identifying spending patterns and freeing up money to spend on the things you value most. What’s more, by avoiding unnecessary purchases you may end up better appreciating the items you already have.
Done properly, a no-spend challenge isn’t about restricting yourself aggressively only to give up because it’s too hard, or snapping straight back to your old approach. With the right rules in place, a no-spend challenge doesn't have to be restrictive. And you don’t have to do it for a month or whole year. Even a no-spend weekend could tell you a lot about your spending habits.
It’s worth emphasising that committing to a no-buy period and seeing it as a challenge is a privilege, as many people don’t have this choice.
If you’re willing and able to take it on, here are nine tips for starting a no-spend challenge if the idea scares you.
Identify areas to cut back on
Aside from essentials, is there something you spend a disproportionate amount of money on but doesn’t bring you much value or joy? That might be clothes, takeaways, beauty products and treatments, home decor, or subscriptions.
It’s useful to know which categories you’re currently spending money on before setting your no-spend challenge rules.
To do this in Monzo, head to Trends, select Spending and you can view your spending broken down by either category or merchant.
Decide how long you want your challenge to be
You don’t have to do a no-spend challenge for a whole year or even a month to learn valuable lessons about your spending habits.
A no-spend weekend is a great place to start. Otherwise, a few no-spend weekdays, or a whole week if you can, might be an easier first step.
Be realistic about how long you’ll keep it up and set a clear timeframe to keep you motivated. The longer your challenge, the more sustainable your rules will need to be. More on this below.
Have a goal in mind
Know what you want to do with the money you aren’t spending. Are you paying off debt? Building an emergency fund or a sinking fund? Or saving for something special?
Reminding yourself of your goal regularly will help you stay on track, especially when you feel the urge to buy a new pair of trainers or another scented candle.
You could create a Pot and add the amount you’ve saved each time you resist temptation. To do this in Monzo:
Tap your display photo in the top left corner of the Home tab
Scroll down to Your Account
Tap Create a Pot and choose between a Regular or a Savings Pot
Name the Pot and add a fun custom image that will motivate you to keep adding to your fund
Set your realistic spending rules
If your no-spend rules are too restrictive, you risk feeling frustrated and burning out. Instead, factor in socialising and specific items or experiences that make you happy.
Obviously, you’ll still need to spend money on necessities like bills (electricity, mortgage/rent, internet and phone, food and petrol, etcetera).
What you want to do is avoid unnecessary spending that doesn’t add much to your life. Pick a category (or categories) you aren’t happy spending on and cut them out during the challenge. For example, takeaways (when you already have food at home), clothes or personal care products (when your existing ones don’t need replacing).
If certain types of spending are particularly meaningful to you, keep factoring them into your budget and cut out something else instead.
Don’t deprive yourself of joy
Allow yourself to keep buying things you value – you still want to enjoy life. Whether that’s particular items, solo trips or socialising.
You can also suggest cheaper (or free) plans to socialise. Like cooking someone a meal using ingredients you already have, rather than ordering in. Or bringing a flask of coffee to your catchup round the park rather than getting a takeaway coffee.
Yes, you might want to cut back on meals out, after work drinks and club nights. But hanging out with loved ones at home can be just as fun. Watch films, play games, learn to crochet together. The affordable options are endless.
Avoid temptation
Avoid places where you normally end up splurging. Unfollow or mute your favourite retailers on social media, delete shopping apps and unsubscribe from mailing lists.
Limit your social media time if needed. If you want, create a wish list of products you want to buy once your no-spend challenge is over. If you still want them, or take more time to consider if you really want them.
Keep track of what you’re spending (and not spending)
Stay motivated by keeping a close eye on what you’re spending and saving during the challenge. Here’s how to do it using the Trends tab:
Go to Trends in the bottom navigation bar
Balance shows a total of the money coming in and out of your account. Seeing what you’ve earned, spent and saved can help you pace yourself throughout the month. It also tells you how much you’ve got left to spend after bills and upcoming payments.
Spending shows a breakdown of your transactions separated by category or merchant. Tap each one to see the individual transactions.
Find accountability and support
Tell those closest to you about what you’re doing to keep yourself on track and share your struggles along the way. They might even want to join you.
For wider support and problem solving, join the Monzo Saving Squad and get advice from thousands of other savers, many of whom are currently doing no-spend challenges themselves. Hearing about other people’s experiences might give you ideas and will motivate you to keep going.
Aim for progress, not perfection
Most importantly, give yourself grace. You’ll probably slip up along the way and that’s okay. Learn something from it (what triggered you? What would you do differently next time?) and keep going.
Unexpected costs and expenses happen and they can’t be helped. The main thing is becoming more mindful about your spending and finding out what you really value spending your money on.