The no-spend month challenge can be a tricky but rewarding experience. If your teen or child is looking to save money, break bad spending habits and be a more thoughtful consumer, the no-spend month challenge is a great way to start.
What is the no spend month challenge?
A no-spend month is a personal finance challenge where you commit to not spending any money on non-essentials for a month. It's perfect for teens, as it includes eating out, shopping, going to the movies, and buying snacks. You can only spend money on pre-agreed essentials, such as lunch and transport.
The no-spend month challenge aims to help your teen and child learn to save money and become more mindful of their spending habits. It can also be fun for kids and teens to see how much they can save in a month.
Key rules of the no spend month challenge
The key rules of the no-spend month challenge can vary depending on your child and teen's circumstances and goals and what you want to teach them. However, some standard rules for kids and teens include:
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Only spend money on essentials, which should be pre-agreed and written down.
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Don’t order food via any delivery service, buy drinks, or shop for snacks.
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Avoid in-app purchases and gaming buys.
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Don't shop online to avoid impulse spending.
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Be prepared for challenges and have a plan in place to resist temptation.
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Track your spending on essentials to stay on track.
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Tell your friends about your challenge to help you stay accountable, or suggest they join you to motivate each other.
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Don't be afraid to ask for help if you're struggling.
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Don't give up if you slip up. Just start again the next day.
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Make the challenge a positive experience. Focus on what you're saving money for and the benefits of a more frugal lifestyle.
The benefits of the no spend month challenge
It will help your child to understand the importance of saving money
Saving money can seem like a chore to kids, so they find it more tempting to spend money rather than put it away for a rainy day. However, teaching them the importance of saving can help build great money habits that will last for a lifetime. Our economic research with CBI Economics has shown the difference teaching kids to be financially literate can make. The research has found financial literacy raises early-career earnings prospects by up to 28%. Teaching kids how to save also gives them economic confidence around spending, enabling strong decision-making for long-term investment and less debt overall.
It will teach your child how to delay gratification
The no-spend month also teaches delayed gratification, a fundamental part of financial literacy and money management. This is because children who can delay gratification are better able to control their impulses and focus on long-term goals. This is a valuable skill for managing money, as it helps them save for the things they really want or need.
It will show your child the value of money
Teaching your kids to understand the value of money can be challenging as they have a limited understanding of how much things cost or how much time and effort it takes to earn a wage. This can make them think that they can afford something when they can't. This challenge can help them understand the value of money by encouraging them to make extra money if they want to spend outside the challenge. This can be done via extra chores for pocket money or selling items on marketplaces.
Helps kids to realise they can make do with less
There are many reasons why kids don't realise they can make do with less. Being constantly bombarded with messages about the importance of having more from advertising and their peers is one of the main reasons. They also equate their self-worth with what they have, making them feel like they need more things to feel good about themselves. Having a no-spend month can help them realise that they have enough and can make do with a lot less.
Makes kids consciously think about spending
Having limited financial resources, even for a month, can make kids and teens more conscious of their spending and encourage them to think about how they spend their money and why. It also reveals how much money they waste on things they don't really want or need..
Helps kids to consider what makes them want to spend
Most kids have bad impulse control when they see things they want. Having a month where they can't spend can help them to stop and think about why they spend, what drives them to spend and how to deal with these impulses.
It helps them to understand the difference between needs and wants
When kids are only allowed to spend money on essentials, they learn to distinguish between things they need to survive and things they want. This is an essential financial skill that can help them make wise spending decisions in the future.
It helps them to develop self-control
When kids are tempted to spend money but resist it, they exercise self-control. This skill can help them in many areas of their lives, including financial well-being.
It teaches them the importance of budgeting
When kids have to create and stick to a budget, they learn how to manage their money effectively. This is an essential skill that can help them avoid overspending and debt.
It helps them to appreciate the things they have
When kids are forced to make do with less, they learn to appreciate what they have. This is an important lesson that can help them to be more content with their lives.
10 Tips for helping your child complete the no spend month challenge
Planning is key for the no-spend month. Here are the tips for a successful month.
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Set a date. Choosing a suitable month is key for this challenge. December, summer holidays, their birthday month and even October, due to Halloween, may not be good months to reel in their spending. By comparison, months when they are occupied at school and there's nothing to celebrate are better.
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Set a goal. What do you and your child want to achieve with the no-spend month challenge? Do they want to save money for a specific purpose? Or do you want them to get a better handle on their spending habits? Write down your goals and put them somewhere you can both see.
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Make a list of non-essentials. What things does your child typically spend money on that they could go without for a month? This could include eating out, going to the cinema, buying coffee, and shopping for clothes. Include your child in this chat – what you consider non-essential could be essential for them.
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Make a list of essentials they can spend on. Again, include your child/teen in creating this list and make sure there’s money for friends and family birthdays and necessary miscellaneous school purchases.
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Get creative with the challenge. There are many ways to have fun without spending money. Talk about making fakeaways together,
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Make extra money. If your child/teen complains about lack of cash, suggest selling clothes, shoes and accessories on online marketplaces to generate extra cash (and to see how much they have spent on items they don't need or want).
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Be prepared for slip-ups. There will be times when your child feels tempted to spend money or forgets the challenge and then spends money. Be ready for these challenges and have a plan in place to resist temptation and get back on track.
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Track progress weekly. This is a great way to motivate your child, as seeing how much they have easily saved by simply not spending can make them rethink their spending habits.
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Allow a small amount of "fun money" each week. This could be used for things like going to a cafe with a friend or buying snacks.
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Encourage your child to stay away from their spending triggers. Is it TikTok? A particular friend or shop? Whatever their motivation for spending is, steering clear for a few weeks will help them to achieve this challenge.
How can your child try the no spend month challenge with GoHenry?
GoHenry is a great way for kids to learn about budgeting and financial responsibility. With our prepaid kids debit card, kids can learn all about budgeting in a safe and responsible way. They can also use in-app Money Missions to learn more about budgeting via fun quizzes, videos, and bite-sized lessons for every age. All our lessons are tailored to your child's age and level of understanding.
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