We have all heard of Dry January, giving up alcohol for the first month of the year to help shed a few of those extra Christmas pounds.
However, many have taken the notion of abstaining after the festive season a little further by limiting what they spend on non-essentials, which has been termed No Spend January. Obviously, the basics, such as food for the family, the mortgage, gas and electricity, have to be paid for, but people are finding they can save significant amounts of money by planning ahead and cutting out waste for a whole month.
Advocates of No Spend January argue that it has four major benefits:
- Resetting your spending habits
- Stopping instant gratification. If you really want something, then it is worth waiting for
- Cutting waste
- Keeping money in your pocket, as the cost of luxuries such as a daily coffee can mount up significantly
The campaign has also encouraged families to use what they have, such as food that has been lurking in the freezer for months.
One family, quoted in an article in The Times, claimed to have saved an astonishing £1,300 in one January. They did it with the help of some serious food planning, no eating out and the following rules:
- No Starbucks
- No Amazon
- No new clothes
- No impulse purchases
- No toys, books or new entertainment purchases
- No manicures or hair-dos
That list might look draconian, but as advocates of No Spend January say, it is only for a month, and the savings to be made are significant, especially with energy prices rising, interest rates going up and a rise in national insurance in the pipeline.
Even more significantly, the charity StepChange says it takes the average Brit seven months to get rid of their Christmas debt. No Spend January enthusiasts say that they do it in just one month.
The key, according to the family who saved £1,300, is to make sure that everyone is on board with it. “The children understand that in order for them to have a wonderful Christmas there have to be sacrifices in January,” one woman said.
The strict approach and self-discipline needed for No Spend January may not be to everyone’s taste, but it is an approach people could take at any time of the year to yield significant savings.
With a huge increase in the cost of living on the way, greater financial discipline could pay off for many households in the long run. And if it helps reduce waste in the process, we definitely approve!
It is important to take professional advice before making any decision relating to your personal finances. Information within this article does not provide individual tailored investment advice and is for guidance only. We cannot assume legal liability for any errors or omissions it might contain. Ethical Futures llp is authorised and regulated by the Financial Conduct Authority.