Millennial Money: How to nail a no-spend month

Holiday spending always gets the best of me. The gifts, the food, the Christmas tree and decorations — sandwiched between two monthly rent payments — siphon money from my bank account. Every year I feel the sticker shock, briefly tuck my tail between my legs, then carry on like it never happened.

But this year I’m trying something different. I’m committing to a no-spend January. That means I’m freezing spending on unnecessary purchases this month to build my savings back up. Goodbye, mindless Target-app browsing. See you later, desserts.

I’m not the only one to emerge from the holiday season in less-than-ideal financial shape. More than half of 2019 holiday shoppers (55%) took on credit card debt, according to NerdWallet’s 2020 Holiday Shopping Report.

If you’re looking to shed holiday debt, boost your savings or simply manage your money better, a spending freeze can get you on track. Here’s how to embark on (and stick to) a no-spend month.

CUSTOMIZE IT

A “no-spend month” sounds strict, but there are no hard-and-fast rules. Obviously, it’s about reducing spending. But resolving to spend no money whatsoever is unrealistic. There’s no need to take it to an extreme, especially during a pandemic when many of us have already scaled back our spending.

Everyone has expenses they can’t go without, like groceries and electricity. You get to decide which categories are untouchable and which ones to cut.

Start by defining your discretionary expenses, known as “wants.” For many of us, those include restaurant dinners, alcohol or frivolous online shopping. Leo Marte, a certified financial planner based in Huntersville, North Carolina, suggests using a budgeting app to easily identify your nonessential spending categories. Then, pick which ones to...