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Once a year, my family does a no-spend challenge for an entire month. It’s a great way to reset your finances and truly see what you can live without. No-spend challenges are great for boosting your savings account, paying off debt, or saving for big-ticket items like home renovations or vacations.

Each year our goal changes for our no-spend month. This year, we are saving for a vacation. Last year, I was on maternity leave so finding ways to not spend money was beneficial. The year before that, we paid for our new roof in cash without touching our emergency fund.

No-spend challenges so not have to be for an entire month. It can be for a day, weekend, one week, or whatever you choose. No matter how long your spending challenge lasts, you want to make sure it is successful. But how can you do that? As someone who has participated in many no-spend challenges, I will let you in on my secret to success.

What is a No-Spend Challenge?

A no-spend challenge is when you don’t spend any money on non-essential things like entertainment or clothing and ONLY spend money on essentials. Cutting non-essential spending for a little while can free up some cash. Here is my list of what I consider essential and non-essential spending:

Essential Spending

• Food (Groceries)
• Fuel
• Bills
• Medicine
• Pet Food

Non-Essential Spending

• Dining Out
• Alcohol
• Clothing
• Entertainment
• Home Décor
• Hobbies
• Beauty
• Travel

Step One: Define your goal

A goal without a plan is just a wish. I am not sure who I just quoted there but it is true. You have a plan by participating in a no-spend challenge but what is your goal? What are you planning to get out of your no-spend challenge?

Be SMART with your goals. Do not make a goal that you cannot achieve. If you clearly define your goal, which will be your motivation to continue the challenge when you feel like giving up. No-spend challenges are not easy. Once you start one, you will think of all the things you want to buy. Things that you never thought to buy before! These are the urges that you must fight and have a goal in mind will make things a little bit easier.

Click here for a FREE Financial Goal Planner to help you set your challenge goals

Step Two: Check your budget

During a no-spend challenge, it is common to not spend money on luxury items such as entertainment, hobbies, or dining out. But what happens when you have a birthday party to attend during your challenge? Plan accordingly. I am not saying don’t go to the birthday party. Go to the party and have fun but when you buy the gift, stick to your budget.

During our no-spend month, besides bills and groceries, I make a category for miscellaneous for this reason. We have 2 kids and birthday parties, class parties, and fundraisers always seem to pop up. I set aside $100 for miscellaneous spending during our no-spend month for these surprise events.

Step Three: Cash Only

This is the absolute key to the success of a no-spend challenge. Lock away the credit and debit cards and only use cash. Since we participate in the challenge for an entire month, I withdraw the cash from our bank account once a week. When the cash runs out, we are done. Thankfully this has not happened yet.

I have learned when I use cash, I am more conscious of what I spend my money on. Knowing that I have to count the dollars and cents and watch the cash disappear scares me a little…or a lot. I definitely don’t spend as much when I use cash.

Step Four: Make a List of Free Activities

Doing a no-spend challenge does not mean that you can’t have any fun. There are many local events that are free to the public. I don’t know about your city, but our libraries have great (free) events for kids! I’m not just talking Storytime at the library, we saw the local orchestra perform and made some pretty cool arts and crafts.

My husband and I had a free date night when we went to see his favorite band do a live show at a local bar last year. We also took advantage of the free days at the museum. You will be surprised what you find in your town.

For more ideas of money-free things to do during a no-spend challenge, check out this list…

Step Five: Take it day by day

Like a said, a no-spend challenge is…well…challenging. Taking it one day at a time will relieve the pressure of completing a no-spend challenge. Baby steps are key. If you only think about the day ahead, you will be surprised how fast it goes by.

If you fall off the wagon, no big deal, just try again tomorrow. Remember, this is your challenge and no one else’s. Besides, if you mess up one day, who is going to know? I won’t tell, your secret is safe with me.

Step Six: Finish and Celebrate!

When your no-spend challenge is completed, don’t forget to celebrate. Choose something you will look forward too. I always choose a favorite restaurant. Buy that shirt you have been eyeing, get your favorite meal, or pamper yourself. Whatever you choose, make sure it is something you will look forward to.

Have you done a no-spend challenge? If so, how did it go?