Reset Spending Habits with Fun Challenges

Financial Freedom in 2021! Take Action: Day 10

We’ve talked about making changes to the Big 3 expenses, but in order to reach a maximum savings rate for your family, it may be time for a (mindless) spending reset as well. I love to take on mini-challenges throughout the year to reset my spending habits and to make this financial independence journey that much more fun.

This doesn’t mean that life has to be emptied of valuable experiences or that your home has to qualify for a minimalist lifestyle website. It just means that you use a specific challenge to identify what you’re capable of and what’s most important to you. Basically, these challenges are opportunities to cut the fluff.

I propose that you engage your family (or friends) in a fun money-saving challenge at least once per quarter. Here are a few ideas:

Spend-Nothing Week: Try spending an entire week eating what’s left in your fridge and pantry and participating in free entertainment options, like game nights and hiking. After the week ends, reflect on whether you missed out on anything significant.

Free-Activities Month: What if you spent an entire summer month participating in only free activities as a family? Think beach days, picnics, bouldering, swimming in rivers and lakes, neighborhood scavenger hunts, and playground-hopping.

Purge Week: De-clutter one room per day and pull out items no longer useful to you. Think of rooms like the attic, closets, playroom, and the garage. Then, as a reward, list all of those items for sale online the following week (and donate those not worth selling). Use 25% of the money to do something really fun together and save the other 75% toward one of your priorities.

Budget Birthdays: Challenge the whole family to participate in budget birthdays for the year. Set a spending amount, such as $50 for the fun and $50 for the gifts, for each birthday celebration. Get creative in finding free locations, use hand me down decorations or items in your home for decor, and stick with homemade treats. As for gifts, try freecycle, buy-nothing sites, or consignment shops to find new-to-you items.

A Month of Eating In: Can you do it? Can you make it a whole month without fast food, your favorite take-out, or a night out at a restaurant? You can do anything for 30 days, right? It would be a great challenge for a reset, and when the month is over, you’ll think twice before just grabbing a dinner that’s convenient rather than saving the money and the extra calories. You might also get pretty savvy in your own kitchen and make use of what you have already in your pantry.

Vacation for <$500: Challenge yourself to plan a family vacation for under $500. You can do it even without tent-camping. Stay tuned for tips on frugal travel.

Today’s action step is to commit to a few challenges this year. Get out your planner and write them in.

When a challenge ends, reflect on what you learned from it. How much money did you save? Did you identify anything you really missed out on and want to make a priority in the future? Did you identify things that you’ve been spending on that really aren’t that important? Was the challenge fun or stressful? Are you ready to do another one?

Set your Priorities

Financial Freedom in 2021! Take Action: Day 2

There are about 20,000 ways to set goals and about twice as many books, websites, worksheets, webinars, and videos to teach you how to do this the “right” way. Goal-setting can feel overwhelming, and figuring out how to start can be a deterrent to starting at all. Instead, I try to identify my top *priorities* first. I find it helpful to make a short list and a vision board of what’s most important to our family before thinking through budgeting, saving, investing, or goal-setting.

For us, those priorities are (in no particular order):

  • Travel (hoping to see all 50 states before first child graduates)
  • Family Traditions
  • Tithing/Giving
  • Saving 25% of income for early retirement
  • Real Estate investing (2 doors/year)

Other priorities that might make your list include: Career Advancement or Change, International Travel, Marathon Race(s), Visiting Out-of-Town Family, Ministry or Mission Work, Retirement this Year, Climb a Mountain, Vacation Home, Pay Off Debt, or Start a Side Hustle/New Business.

For today, make your family’s specific list. Write these down in a journal or under the net worth number you calculated yesterday. Once big priorities are set, it becomes much easier to set incremental, measurable goals. These priorities will also become key in establishing your annual budget. More on that tomorrow…