Revamped Takeaways for Frugal Folks
- In these tough economic times, "no-spend" challenges are all the rage online as people try to rein in their spending.
- These no-spend challenges encourage folks to review their spending habits and save more dough.
- To optimize your own no-spend challenge, you should identify your goals, eliminate spending triggers, and park your savings in a high-yield account.
Expenses Reduction Goal: Some U.S. residents adopt a 'purchase ban' due to financial worries
Step foot onto FinTok (short for the personal finance corner of TikTok) and you'll likely stumble upon the "no-buy" month - a budgeting challenge where you refrain from procuring non-essential items for a month. Whether you're foregoing a single category of discretionary purchases this month or cutting all non-essential spending, the goal remains the same: spend less, save more.
As Americans face inflation, stagnant wages, and other economic challenges, folks are taking on variations of the no-spend challenges to stretch their dollar further and alter their spending habits. These challenges range from merely trimming the fat in their budgets or making an attempt to spend less, to forgoing nearly all discretionary spending for a year.
One such fiscally-focused individual is Kelci Crawford, a 35-year-old freelance artist from Toledo, Ohio. Crawford has sworn off spending beyond bills, essential groceries, needed replacements, and mutual aid for friends and his community for the entirety of 2025. He aims to boost his emergency savings fund to $3,000 this year while paying down $1,000 in business and personal debt.
"I caught myself overspending and thought, 'I've got to do a hard reset. I've got to do a no-spend year,'" Crawford states.
However, forgoing every discretionary purchase for an entire year isn't practical for most folks. Cutting out discretionary spending entirely is a significant shift, and eliminating toys, electronics, and activities might be especially challenging for families with children. To address this issue, many people tailoring the no-spend challenge to fit their financial needs by only cutting out expenses they find themselves overspending on, such as dining out, clothing, or beauty products.
Iris Ayala, a 27-year-old content creator in Chicago, is one of those people. Ayala has opted to forgo makeup, athletic apparel, new technology, hair tools, hair care, and reusable water bottles for the year of 2025, estimating she's saved around $5,000 so far.
"I moved into a new place, and naturally, when you move, you declutter things you don't need anymore. I looked around and saw all these items I was buying just nonchalantly, and it's all just money I was throwing away," Ayala explains.
While the no-spend challenge may save you some cash, it won't eliminate your spending addiction in the long run if you don't address the root cause. Before purchasing something, Ayala says she's more mindful of whether using the entire product and if she's getting her money's worth, as opposed to merely buying based on trends or recommendations from social media.
"I've found numerous benefits that aren't just financial," Ayala adds. "My wallet is feeling a difference, there's no doubt. I didn't realize how much unnecessary spending I was doing, now that I'm a no-buyer. But I've also noticed having less clutter has been beneficial for my mental health."
Financial Pro Tip: Give the "no-buy" challenge a whirl by curbing discretionary spending for one week per month, or one month per year. Before embarking, scrutinize your spending patterns to understand why you spend as you do, so you can avoid "revenge spending" post-challenge.
Many Americans are swapping their swipe for the no-spend challenge due to escalating prices and shaky financial futures. Forty-three percent of Americans would borrow money to cover a major unexpected expense, such as a $1,000 emergency room visit or car repair, according to our website's Emergency Savings Report. Without a sturdy savings cushion, a minor crisis could trigger significant consequences, like failing to pay bills. Around a third (34 percent) of employees are juggling their salaries rocket science-style, meaning they have little to no cash flow for savings following the payment of monthly expenses.
Although the no-spend challenge isn't for everyone, as Americans grapple with poor savings and rising living costs, inventive solutions like the no-spend challenge may be just what the financial doctor ordered in today's economy.
- To optimize your no-spend challenge, consider parking your savings in a high-yield savings account, like a personal finance platform.
- Apart from the "no-buy" month, some student loan borrowers might find success in a debt-management plan, which prioritizes repayment of high-interest loans first.
- In the personal-finance space on TikTok, known as FinTok, every month could be a no-buy month if you're committed to budgeting and saving.
- Kelci Crawford, a freelance artist from Toledo, Ohio, is aiming to boost his emergency savings fund to $3,000 this year while paying down $1,000 in business and personal debt, all while participating in a no-spend year.
- Iris Ayala, a content creator in Chicago, is forgoing makeup, athletic apparel, new technology, hair tools, hair care, and reusable water bottles for the year of 2025, with the goal of saving around $5,000.
- To avoid "revenge spending" post-challenge, scrutinize your spending patterns to understand why you spend as you do, and be mindful of whether using the entire product and if you're getting your money's worth, instead of just buying based on trends or recommendations from social media.
