No-spend challenge

What It Means

A no-spend challenge is a period you choose, such as a week or a month, when you buy only essentials. Rent or the mortgageMortgageA loan used to buy or refinance a home, secured by the home itself and repaid in monthly installments over a set term. See more, utilities and other bills, basic groceries, transportation and health care still get paid, and the extras stop: takeout, shopping, entertainment and similar spending. You set the rules before you start, including what counts as essential and any exceptions you already know about.

How It Sounds at Home

• "We're doing a no-spend month, so no takeout."
• "Does coffee count as essential?"
• "Only groceries and gas until the 31st."

The Breakdown

Worked example. Jess and Omar plan a no-spend month. First they list what stays: rent, utilities, the phone bill, basic groceries, gas and prescriptions. Everything else they usually spend on goes:

At that pace a month of extras runs about $693. They plan one exception, a $40 wedding gift for a friend, so about $653 stays unspent if the rest of the month goes to plan.

What the result means. Money left in checkingChecking accountA bank or credit union account for everyday money going in and out, used by debit card, checks, transfers and direct deposit. See more has a way of getting spent later, so move the unspent amount to savings or a debt payment when the challenge ends. The figure is only an estimate, since a month without extras may shift some spending to the weeks after it.

Setting the rules

1. Pick the length: a weekend, a week, a month or longer.
2. List what counts as essential before day one.
3. Name the exceptions you already know about, like a wedding or a birthday.
4. Decide where the unspent money will go.
5. When it ends, look back at what you missed and what you didn't.

Good to Know

No official body sets rules for a no-spend challenge, so the ones here come from Fidelity and Experian, which both describe it as spending on essentials only for a period you choose. Their guides suggest deciding what counts as essential before you start, and leaving room for planned occasions and real surprises, such as replacing a laptop that breaks. Keep paying every bill on time during the challenge. If essentials themselves are hard to cover, the CFPB's Your Money, Your Goals toolkit has guidance on which bills and spending to put first when cash is short.

Related Terms and Categories

• No-spend day

  A day when you spend nothing beyond essentials and bills already scheduled, often picked as one day a week to build the habit.

• Discretionary spending

  Money spent on things you want rather than need, like eating out, entertainment and travel. In government, the spending Congress sets each year.

• Savings challenge

  A set of simple saving rules followed for a fixed stretch, such as a rising amount each week, to build a savings habit and a balance by the end.

• Needs vs wants

  The split between costs you must pay to live, work and protect what you have (needs) and extras that would be nice to have (wants).

• Frugal living

  A way of living that spends carefully and avoids waste, so more of your money goes to the things you value most.

Household money and budgeting