How to Do a No Spend Year

Last week the beautiful and amazing, Katie Coughran, mentioned my three year no spend challenge on her podcast, How to be a Minimalist. She discussed her plans to start her own no spend year. While Katie and I have different approaches to a no spend year, both are equally as awesome. Both approaches get us to the point on being intentional on where and when we spend our money. Intentionality on spending money was completely missing from my life prior to starting my first no spend challenge year.

Over the last three years I have written about my personal no spend challenge.  I adopted the approach that Cait Flanders took in her book, The Year of Less.  I have a list of essential expenses, approved expenses, and non-approved expenses.   And for three years I have taking this same approach.  Katie’s podcast got me thinking back to my expenses, my goals, and how things have been going.  My recent Instagram post raised a bunch of great questions about this process.  Today I’m going to try to explain in better detail.  Here it goes!

Why Did I Start my First No Spend Year?

I woke up one morning in a cold sweat panicking that I would never be able to retire because of my debt and lack of retirement savings.  Before my first no spend year started, I spent the previous year and a half paying off credit card debt.  As I put every dollar I could towards that debt I swore off debt and credit card debt.  I swore off shopping.  I swore off wasting money.  I swore off wasting time. 

After my credit cards were paid off, I literally had them locked up.  Mr. BMM had my credit cards in a secure location.  If I needed to use a credit card, I had to ask him for the card.  I treated myself like a child. 

I was never taught money management growing up so I mirrored what I saw. I saw a whole lot of credit cards being swiped for nice, new, shiny things. I never saw the credit card paying process. I had no idea how to budget and manage money. I always got to the end of year tax time wondering where my money went.

Yet I saw people who earned less than me talk about this mysterious thing called a savings account and retirement savings.  I was angry that I didn’t have those things.  I was super jealous too.  After I got through the anger and jealously, I realized that I could have those things too.  But it was going to take a whole lot of work if I was going to learn to budget, learn to manage money, learn to save, and learn to invest in my future. 

I have always been the type of person to go big or go home. I’m either it’s a hell yeah or a hell no. It’s either 5 stars or 0 stars for me. Of all the decluttering methods out in this world, I love what I think, is the most extreme method, KonMari. I felt that I needed to take some drastic measures to pay off my remaining debt and save for retirement. In hindsight, having a budget, paying off debt, and saving money is not some drastic feat of strength. It’s really quite basic.

I fell in love with Cait Flander’s The Year of Less.  I felt that she was speaking right to me.  Before Mr. BMM, I too spent too much time in the bar.  I too spent too much money on things I didn’t need or like to impress people I didn’t like with money I really didn’t have.   After I read the book, I spent about another month pondering my personal no spend rules.  Once I had my set of no spend rules draft, I had to make it public. 

I won’t forget the day I declared 2019 as my no spend year to Mr. BMM. He was skeptical. As he should have been. He knew me probably better than I knew myself at that time. But he was supportive and kind. Week after week I told him about my money wins. And week after week he smiled with love. And week after week became month after month. And after the first year, I realized that my bad money habits were just one bad day shopping binge away so I continued my no spend year to 2020. Towards the end of 2020 I felt that I could probably relax the rules and then I thought otherwise. So here I am. It’s 2021 and I’m just wrapping up the first month of my third no spend year in a row.

What I Previously Valued But No Longer Value

During my initial no spend year I gave myself permission to spend money on a Spotify premium membership, Amazon Prime, Brooklyn Public Library membership, essential oils, GPS watch for running, books, and magazines to name a few.  At the time those expenses were essential because they added value to my life.  The key to a no spend year is to spend money where there is the highest return of value within your budget.

After time, less things seem to hold a high value for me. It’s the relationships and adventures that mean so much more to me.

How I Handle Social Situations

Let’s be honest with ourselves about some social situations.  If someone is getting mad because you no longer spend money on a particular area, that’s their ego talking.  You aren’t the problem.  In the beginning I had a friend that loved to meet up for lunch.  Meeting up for lunch was never an exciting event for me.  Upon declaring the start of my no spend year, I offered this same friend the option to meet up for a walk instead.  She declined and we haven’t gotten together since. 

A similar thing happened to me and Cait Flanders when we gave up drinking. Some friends stayed and opted for the free hike while other friends said adios. I have to admit that 99% of the time when I respond with “would you like to meet up for a walk instead, I’m trying to pay off debt,” the friend on the other side sighs with relief and then states that they too are trying to save money. Funny how that works!

How you spend your money is 100% up to you!

Each year I do list several social functions/events that I would like to participate in.  They have ranged in attending a special yoga event to traveling a little further than normal to try a new hike to attending a book signing to exploring a new library.  Whatever I found to be important to me gets put into my budget. 

Going Out to Eat

My husband and I still go out for dinner.  It’s something that we both value and enjoy doing just ourselves as well as with friends.  Just because we go out for dinner, doesn’t mean we blow the budget.  First off, we take turns paying the bill, we don’t order drinks, and keep the meals reasonable.  After all it is all about the conversation and time with others that’s most important to us.  The key to spending money is to determine if this is part of your budget and if this is part of your essential/approved spending list.

Do I Still Buy Things?

Yes! I buy things that are approved or noted as essential. I make the decision on what is approve or essential in November/December so that I give myself enough time to reflect on things that I may or may not want to change. Groceries, house bills, and replacement running shoes are always approved.

What do I do with the Money I’m Not Spending?

During 2019 and 2020, the main purpose of my no spend year was to pay off debt.  While I had car and student loan debt both years, I focused my debt pay off towards my car.  AND I OWN MY CAR NOW For me it was the right decision and depending on who you listen to it could have been the wrong decision.  Regardless of what I should have paid off first, the main point was that I paid off debt.  I have a huge passion and drive to be financially independent. 

During 2021, I’m going to continue making the minimum payment on my student loans in order to save up $21,000 in investments. I need to capture time in the market to help bring me closer to financial independence. Again where you put your money is a personal choice but paying off debt or investing sure beats wasting money on junk that’s just going get decluttered out of your space.

Do you only eat Ramen Noodles?

No. Eating good food that nourishes myself and my family was important and noted as essential. We do however balance great food and a budget. We go to local farmer’s markets during the summer. We try making some fancier cuts of meat at home rather than ordering at a restaurant. We spend about $20 per person per day for all of our meals/snack/personal care items. Could it be lower? Sure. Could it be higher? Sure. But it’s just right for us. The important thing is to have a budget and stick with it.

Do I have Any Regrets about a No Spend Year?

Nope. Nada. Zero. Ziltch.  Nay.  Not.  No.  I regret nothing except not doing this sooner.  The financial peace that I feel by finally having my financial life together is the reason why I did this in the first place.  I haven’t interviewed the whole world, but I don’t think anyone would regret paying off debt or investing their hard earned money. 

green plant in clear glass vase

9 thoughts on “How to Do a No Spend Year

  1. I’m about to start a shopping ban myself. I’m not sure how long I’ll aim to go at first but Cait Flander’s book also spoke to me (so I am decluttering as well as the shopping ban). I’m so happy to hear you’ve been able to do it for three years & have paid off debt! That really gives me hope for my own plans.

    Cheers,
    K
    outfromunder.blog

    Liked by 1 person

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