Have you heard of the no-spend chalenge? It’s a popular concept among budget-minded and minimalist bloggers who encourage us to save more and declutter our lives. The idea is simple: stop spending on non-essentials for a set period and see how much you can save. The more you save (and invest), the sooner you'll achieve financial freedom.
For the most part, I haven’t needed to try it. I don’t buy much aside from athletic gear that wears out every 6–12 months since I play a lot of tennis and pickleball. The last time I bought a pair of jeans was over a decade ago, and I can’t even remember the last time I bought a dress shirt.
Since 1999, I’ve averaged a ~50% saving rate. During my final year of full-time work, I pushed it to 80% to prepare for my exit. So while I’ve always been frugal, I’ve never done a formal no-spend challenge.
But if there were ever a time to try one, that time is now.
Let’s Give the No-Spend Challenge a Go
Here are some compelling reasons to take part:
- Inflation expectations are rising, meaning goods and services will likely keep getting more expensive. Adjusting now helps you adapt.
- There’s a ~30% chance of recession or stagflation over the next 12 months due to ongoing trade tensions and geopolitical uncertainty. As a result, you could get laid off and struggle to find work for an extended period of time.
- The stock market is priced at ~22X forward earnings, which makes it vulnerable to another correction. Holding more cash gives you options.
- You may have missed buying the dip. Saving now gives you a chance to be ready for the next one.
- You’re underinvesting in your children’s financial future. A no-spend month can help redirect funds to Roth IRAs, custodial accounts, or 529 plans.
- You're working to become a wealthy Bank of Mom and Dad, giving your children a stronger launchpad for the future.
- Your local housing market is slowing, with overbuilding and persistently high mortgage rates. Grow your down payment to take advantage of better deals.
- You might be living paycheck to paycheck due to recent lifestyle inflation or a big-ticket purchase. A spending reset helps rebuild your liquidity.
More Reasons to Try a No-Spend Challenge
If the above practical reasons aren't good enough to help you curb spending, here are some other reasons worth considering.
- Test your financial resilience before life forces you to.
- Strengthen your money discipline. It’s a muscle. The more you flex it, the stronger it gets.
- Reset your baseline for happiness. You may realize you don’t miss spending nearly as much as you thought.
- Reduce decision fatigue by eliminating what to buy — and focus energy elsewhere.
- See if you truly need to earn as much as you do. When I left work in 2012, I made ~80% less for the first two years (excluding my severance package, which I invested 100%). But because I had been saving 70%–80% of my income for years, my lifestyle wasn’t impacted. In fact, it dramatically improved. I felt freer, less pressured, and had time to mentally and physically heal.
Challenge Duration: Minimum 3 Months
Anyone can do something difficult for a week. But to really change behavior, a challenge needs to last at least three months – long enough to form new habits and make meaningful progress.
Here’s what I’m cutting out for at least three months:
- Cheeseburgers, potato chips, French onion dip, candy
- Tennis shoes so I can finally go through my inventory
- Haircuts (I’ll use clippers and do it myself)
- Flights nicer than Economy
- Budget-busting vacation rentals
- Electronics (laptop, phone, earbuds, games)
- Household labor for primary home or rentals (gardening, cleaning, etc.)
- In-game purchases, e.g. Pokémon Go coins
Of course, I’ll still spend on necessities: shelter, insurance (health, life, property, auto, umbrella), grade school tuition, and basic food. I will also spend what's necessary to make my parent's ADU unit inhabitable again, such as buying a new fridge and range.
However, the extra savings will go directly into stocks, Treasury bonds, private real estate, and venture capital. My goal is to reduce discretionary spending by at least $1,500 a month, or $4,500 during this challenge.
With AI innovation picking up speed again, I want to invest as much as possible now. One of the easiest ways I’m doing this is through Fundrise Venture, which has exposure to top-tier AI companies like OpenAI, Anthropic, Databricks, Anduril, and more.
If You’re Saving Less Than 20% Of Your Income…
You’ve got a huge opportunity.
To build financial freedom faster, aim to max out your tax-advantaged retirement accounts and save an additional 20% or more. If you earn under $100,000 a year, that might feel tight, but try it. You may surprise yourself with how little you actually need.
If you’re already saving 20%, challenge yourself to bump it to 25%–30% during this no-spend period. Saving that much means every year you work and save could buy you 3–4 years of freedom in the future.
Savings Rate Chart For Financial Freedom
To motivate you to save more, check out this financial freedom savings rate chart. Just bumping up your savings rate by 5% can shave years off your working life.
If you can push your saving rate to 50% or more, you could retire within 20 years of starting your career, and probably even within 10 years from today. My chart doesn't include potential investment returns, which accelerates your path to financial freedom.
Believe me, you’ll adapt quickly to living on less. Don’t be afraid to spend less now in exchange for freedom later. Achieving financial independence requires tough choices, but once you make them and look back, they won’t feel so tough after all.
When I look back at my net worth progression, I’m often surprised by how much it’s grown after several years of strong investment returns. It doesn't seem real, and I end up double checking the figures a lot. You will be just as amazed by how powerfully your net worth can compound over time.
If You Want to Cheat on the No-Spend Challenge
There’s a loophole, but only if you earn it. If you just can’t resist spending on something non-essential, you’re allowed to cheat only if you generate extra income through a side hustle or a smart new investment.
For example, if I want to splurge on first-class tickets to Honolulu, I’d need to earn an extra $1,200 per person, perhaps through personal finance consulting or teaching tennis. By coupling the challenge with earning, I’ll always be mindful of whether the extra spending is truly worth it.
So, will you join me? What are you willing to cut back on?
Let’s take on a no-spend challenge and see where it leads.
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Love a good spending challenge!
For years, my wife and I would do what we called the “$500 challenge” whenever we felt like our spending got out of whack. It was a good way to reset, usually after a big spending month. Even better was when we knew we had a big spending month coming up (like a vacation to Europe) and held back our spending in anticipation. Then, we could spend more freely on our trip.
The best part of doing the $500 challenge was not the financial savings, but that it opened up our eyes to new ways to have fun we hadn’t thought about before. One of the best date nights we ever had was shortly after moving to a new neighborhood in Chicago. We walked a couple miles to and from a restaurant that served our favorite meal, nachos. We even had enough money for one of us to order a beer…
In the end, we saved money on Ubers, had a nice walk where we could chat, didn’t feel stuffed by the time we got home, and got to explore our new neighborhood. If we hadn’t been doing a spending challenge, we would have missed out on these benefits.
Years later, we now try to only go to restaurants on date night if we can walk there.
Good luck on the challenge!
Matt
Love this! The $500 challenge is such a smart and intentional way to hit reset—not just financially, but mentally too. I really like how you tied it to upcoming events like a Europe trip—feels so much better to spend freely on something meaningful when you’ve proactively created the room for it.
And that nachos-and-a-walk date night? Perfect example of how constraints can spark creativity and connection. Sometimes the best memories come from the simplest plans.
Appreciate the encouragement—definitely inspired to think more about how we can make frugal fun a part of our routine too!
Sam,
This is great stuff….unless you are already retired. My Financial Advisor is keen on reminding me that now is the time to spend! At 67, retired 6 years, but with more side hustles than I want (they come to me), I need to focus on spending down my equity accounts now so i don’t have to take out a ton of money I don’t need when the RMD kicks in for the wife and me. Amazon, here I come! (:>
PS. My new OWL Pickle Ball Paddles arrived yesterday via UPS with a $53 surcharge collected at the door due to the Tariffs kicking in. Owl paddles are made in Canada.
Yes, please spend more aggressively at 67!
Fascinating on the tariff surcharge. Did you not like any of the American brands like Joola? Oh dang, they are made in China haha.
What about going out to eat, coffee shops, bars, any sort of entertainment at restaurants with family and friends? Are you planning on cutting those out too? I’d NEVER be able to…haha.
Might have to! But I plan to spend my baseline spending on these things, which is low. It’s just the extraneous things that I’ve listed in my post that I plan to spend down.
Besides, when I’m tanning my cheeks in Hawaii, spending money is not as necessary because the sun is free!
As for travel related expenses, mine is close to zero (flight and lodging). I do use credit card points and miles. But there is a bit of learning to do so. Especially that you are a business owner, you can receive generous sing up bonuses for your spending on those cards. Just a thought.
That’s a great point—thanks for sharing! I also know of people covering nearly all their travel expenses using points and miles, but I haven’t fully tapped into that yet. You’re right though—being a business owner definitely opens the door to some generous sign-up bonuses and rewards. We have a 2% cash back biz card we use.
For the past eight years, we really haven’t traveled a lot because I made it a point to just stay local during the first five years of my children’s lives. I figure, given I can’t remember how much before five years old, might as well keep it local and convenient. But now we are finally going to travel a lot now. Exciting times!
Always great to have encouraging reminders to save and put more money toward investing and big, long-term goals. I think your suggestion of 3 months or longer is also wise in terms of forming new habits.
Absolutely! Building good financial habits takes time, and committing to at least three months really helps make the changes stick. I’ve found that once you start seeing progress—whether it’s growing savings or investment gains—it becomes even more motivating to keep going. Appreciate the encouragement!
I was about to hit the “Post Comment” button for an explanation that I must do some shopping, then I deleted it all! Yesterday, my spouse and I got into a “discussion” about the clutter in the house as I donated a pile of things to Goodwill.
It is better to keep my wallet closed rather than make excuses. A cold turkey No-Spend policy is hard to follow!
Totally get it—those “discussions” about clutter can hit close to home! I admire your honesty. It’s tough going cold turkey with a No-Spend policy, but recognizing those habits in the moment is a big win already. Sometimes just hitting pause before a purchase is enough to shift the momentum. You’re doing great!
Can you discuss saving 50% of salary? Is that based on gross income or after tax income? Can you explain using the round number of a $100,000 salary? How do paycheck deductions that aren’t taxes factor in?
Sure. $100,000 gross, 20% tax, $80,000 after tax, save 50% of that = $40,000.
Or, $100,000 gross, $23,500 to 401K, $69,500 taxable income, 20% tax, $55,600 after tax income, save $27,800 of it.
Many ways you can slice it, but I shoot for the latter.
I’m aiming to cut our overall food cost by 20% this year. The savings is being redirected to costly summer camps for my daughter.
I’m trying to reduce my household operating budget by 5% this year- which is challenging because of cost increases in kids sports, property tax, a second new car, and 2 kids in preschool.
There isn’t much elasticity in our spend, but I’m tracking to meet my goal at this time.
That’s impressive—you’ve clearly put a lot of thought into your budget and priorities. Redirecting food savings toward summer camps is a smart move, especially since those costs can really add up. With so many fixed expenses like preschool and property taxes, even a 5% reduction is no small feat. Sounds like you’re managing the trade-offs well and staying on track—nicely done!
I’m going to join you and not purchase any chips and electronics for the next three months. I go through multiple bags of chips in a week so this is a good challenge.
In terms of other discretionary spending, the summer months is generally the hardest for me since we take family vacations, socialize more, and generally spend more. But baby steps!
Ah, summer is all the more reason to participate in a no-spending challenge!
I added an out for those who can’t resist spending money on something they don’t need: earn extra income or make a wise investment. By coupling additional earnings with additional spending, it helps us better decide whether spending is worth it.