If you are finding your finances are spinning out of control after the holidays, get on track with a fiscal fast. Coined by Jeff Yeager of The Ultimate Cheapskate, it’s exactly what it sounds like: you buy absolutely nothing for an entire week. While this may seem extreme, let’s look at why you should go on a spending sabbatical.
Pros: A fiscal fast is a great way to examine your spending habits and make adjustments. According to Yeager, a fiscal fast will not only save cash, but will also show how you spend—and waste—money. It will also remind you of the great things in life that don’t require you to spend a dime.
Cons: Keep in mind that a fiscal fast is not supposed to permanently change your lifestyle. But if you think it may be too disruptive, it may not be right for you. Yeager thinks that those who are most skeptical of going on a fiscal fast benefit from it the most. “Many times people have no idea how much money they’re spending—and probably wasting—in a normal week,” Yeager explains.
If you think a fiscal fast is right for you, here are some tips for surviving it:
Plan ahead. Fill up the gas tank and purchase food essentials ahead of time. But don’t act like the apocalypse is approaching—just buy what you need for the week. Also, try not to schedule a fast during a week with important events, such as a friend’s wedding or family member’s birthday.
Tell your friends and family. Although you may get some raised eyebrows, telling people you’re going on a fiscal fast will help you stay committed. You can use a program such as StickK to hold yourself accountable as well. Who knows, you might even generate interest among your friends and buddy up on the mission.
Focus on being resourceful. Shop in your closet, concoct a new dish, or explore new ways to have fun. You can also use the Swap It, Don’t Stop It approach to substitute things you normally enjoy spending money on to avoid feeling deprived.
Be kind to yourself. If you haven’t tried something like this before, you can also commit to a shorter time period, say for four days instead of a week. You can also allow yourself a few get out of jail free cards with a $10 spending limit.
Use extra time for self-examination. Shannyn Allan, a 29-year-old financial blogger at FrugalBeautiful.com, went on a 30-day fiscal fast after the holidays last year to reset her spending habits. “The mental clarity it provides me when I do a fiscal fast is priceless. You pause, evaluate, de-clutter and prioritize—it is a great way to reset your life!” said Allan.
Use the money you’ve saved wisely. Pay down debt or open a savings account at your local credit union. By putting a stop on some of your spending habits, you might even discover it is easier to let go of routine purchases and save even more.
Going on a spending sabbatical helps you spot spending patterns that were previously on cruise control. You’ll also find ways to do more with what you already have. Use it as your spending reset to get focused on dreaming bigger in 2015.