We often define our financial lives by how much we make. But what we never do is define our financial lives by how much we spend. I believe we’ve got it all backwards. So did two Canadian roommates who challenged themselves to spend no money for an entire year. Did they fail? Of course, but they did spend significantly less than in previous years. They stopped defining their lives by what they made and started defining their lives by what they could avoid spending, or in other words, save.
It all happened because, then 29 year old, Julie Phillips’ apartment purchase fell through. She arranged to stay with friend Geoffrey Szuszkiewicz (then 31) until she could get her finances together. Over a glass of wine, they grumbled over their poor financial situations. As a joke, they talked about how much money they could save if they didn’t have to buy so much. Then the idea hit them, let’s spend nothing for a year.
They walked to work, they grew their own food, and made their own detergent. Sure their garden didn’t produce enough food to feed them throughout the whole year and occasionally they would splurge on buying a bus ticket during a frigid night, but overall they majorly cut back on their spending. So much so that over the course of the year they were each able to save about 65% of their incomes.
I love this story for a lot of reasons, but mostly because of the name “Geoffrey Szuszkiewicz.” What a name. But seriously, I love this story because sometimes it takes creating a self-challenge to get your financial life out of a rut. I know this, because it worked for me.
In 2009, I was doing my 60 Days to Change program on WISH TV. It was the height of the recession and I was out there trying to encourage and inspire people to make the best of their financial lives. I loved it. But then I started to feel guilty. Not because my financial life was in shambles, but because I wasn’t working as hard as all the people I was working with. So Mrs Planner and I decided to give ourselves a challenge. We decided that for one week we would only make 5 purchases. For reference, the average American family makes 22 transactions in a week. 22. It was quite the challenge. This is how our 5 transactions broke down: Gas for my car, gas for her car, trip to the grocery store, lunch for me, and coffee for her. We were proud of ourselves for reaching our mini-challenge goal, but what happened next was what made the biggest impact. For MONTHS after we did this challenge our spending was impacted. By saying “no” to ourselves multiple times over the course of one week we managed to change our spending behavior for the next several months. We internally questioned every purchase, and subsequently purchased way less than we had previously. It was amazing.
Would those friends have been able to save 65% of their income if they hadn’t challenged themselves to spend next to nothing? It’s highly unlikely, but because they made it a game they were able to do it. Challenge yourself to do something big for your financial life. It could be a no-spend weekend once a month. A no-spend week once a quarter. A week where you limit your transactions to 5. Whatever you can dream up, the options are endless. But, of course, none of that matters unless you take action. Pick a challenge, get some accountability, and then go for it.
Ready to take the challenge? Listen to this segment from The Pete the Planner Radio Show on 93 WIBC:
Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.