Where does all my money go? Even as someone whose career centres around helping people to better understand their relationship with money (after struggling with my own for many years), I often find myself pondering this question. I’m five months pregnant and the breadwinner in our household so this question suddenly feels very urgent, especially during a cost of living crisis.
With rampant inflation and stagnant wages, it’s no wonder that so many of us are struggling with the huge discrepancy between our budgets and our bank accounts. It’s also no surprise that when opportunities to save money on essentials like energy and food are limited, people are looking for creative ways to reduce their spending. Against the depressing backdrop of the current economic climate, 'no spend' challenges – where you aim to have a week, month or sometimes even longer without spending on non-essentials, often tracking your progress on social media – seem to make frugality almost fun. I myself have written about the benefits of gamifying good financial habits, of which there are many – saving challenges like the '1p challenge', where you save 1p on day one, 2p on day two and so on can help you to build better financial habits in an accessible way. Fintechs like Monzo, Chip and Plum have also built in game-like features and challenges – like putting money aside every time it rains, or setting specific targets – to keep users engaged.
The risk of creating a disordered relationship with spending is too great, and glorifying the act of spending nothing at all can make people who find it impossible feel alienated and ashamed.
But I am really troubled by the no spend trend. Quite simply because, to me, the parallels with crash dieting could not be more apparent. I can’t forgive the weight loss industry for the long-lasting damage that fad after fad did to my relationship with food as a teen and a young woman, and I’m not about to inflict a similarly disordered relationship with money on myself at the age of 33. Observing the trend across Instagram, where there are 35,000 posts under the #NoSpendChallenge hashtag, particularly during the self-flagellation fest that is January, I noticed so many familiar themes from my experience of being enraptured by diet culture: the use of green for 'good' days and red for 'bad' days, self-berating captions by people who’d dared to buy a new toothbrush, judgemental or 'tough love' comments. When I posted about my concern about no spend challenges on my own Instagram account, opinions were split. Some people swear by them for a 'recalibration' of their spending, while others found that they were primed for a huge splurge at the end of the allotted time period, or that they became so fixated on not spending that they struggled to buy essentials or treat themselves without feeling incredibly guilty. My feeling is that, although it might work for some people, the risk of creating a disordered relationship with spending is too great, and glorifying the act of spending nothing at all can make people who find it impossible feel alienated and ashamed.
The real challenge, I realised, is applying intention and attention to your spending in the right way. That means without becoming obsessively frugal to the point that it ruins any enjoyment of money whatsoever or – potentially more likely – without creating a binge-purge cycle of overspending and underspending. My feeling is that this sort of disordered relationship with money is likely to cause far more problems in the long term than it solves. As with food, we can’t simply opt out of engaging with money – so how do we keep things in check without becoming fixated?
At the risk of sounding fluffy, I decided that my best bet for solving the 'where's all my money?' problem was to try for a mindful approach to spending. This meant not going cold turkey and instead opening myself up to the potential ramifications of spending anxiety. I set myself the task of monitoring each day’s non-essential spending, thinking a little more carefully about my spending decisions in the moment, and reporting my findings back to my Instagram community on a daily basis. I generally have a reasonable handle on my budget and good money habits, following a big push to fix a huge financial mess (over £27,000 of personal debt) a few years ago, but I was still part curious and part nervous about what I might discover.
The initial aim was more to observe than to shape and I quickly noticed patterns emerging, mainly to do with my constant struggle to keep everyone in our house (myself, my husband, our two boys and our cat) fed without lots of waste or relying too much on eating out and takeaways. I had lines in my budget for all these things and thought that I was being generous in what I was allowing, but it rapidly became apparent that this was the main place where I was haemorrhaging cash. This led to constructive conversations with my partner and a rethink of how I shop for food. I can see changes starting to happen already.
I noticed, too, when I was about to spend for emotional reasons. We are having a baby girl after two boys and the excitement about that new experience was driving me to browse endless tiny pink things. I’ve been anxious about work, and online shopping is always a welcome distraction. My changing body is making me physically and psychologically uncomfortable but there’s a promised solution to that at the click of a button, too. Thinking about my spending helped me to properly notice how I was feeling and to prevent those impulse purchases that would have only led to worry and regret.
In reporting my spending to 100,000 people, I have been able to stay accountable and engage in some interesting conversations but, above all, find solidarity in some of the replies. It kept me engaged with the exercise and I’m so glad because it has been illuminating in ways that I never would have imagined. I feel more connected with my money than I have for a long time, and know which areas I need to focus on to stay in control. It feels like the first step in an ongoing process rather than a test of how much I could deprive or punish myself, which is what I fear a no spend challenge would have ended up becoming for me.
So if you’re thinking about a no spend challenge, maybe try keeping a spending diary or practising a mindful approach to spending first. You might be able to reap the benefits without needing to go to extremes.
Clare Seal is an author, financial coach and the founder of financial Instagram account @myfrugalyear.