HOW A NO-SPEND YEAR CAN HELP YOU SAVE MORE MONEY

This post is about how a no spend year can help you save more money.

Happy New Year and Welcome to the 2022 No Spend Year

Wow, I can’t believe we’ve made it already into 2022.

2020-2021 went by and there are days when I ask myself what day it actually is.

Have you felt the same?

Anyways, it’s a new year, a new clean slate, so they say, right?

I usually like the idea of setting new goals (without adding too much pressure, usually!) because it gives me a chance to hit the reset button for myself in many areas of my life.

How about you? Do you set yourself intentions or goals? Comment below, I’d really like to know.

Today, I want to briefly reflect on 2021 and then introduce you to my 2022 No Spend Year.

Reflecting on 2021 – minimalism, personal finance, contentment

1. Minimalism

2021 was a better year than 2020. Yikes!

It was a year, where, in January,  I took it upon myself to drastically reduce my wardrobe by 25%. After having joined the Marie-Kondo-Bandwagon, I managed to de-clutter clothes on clothes, which, I had purchased come to think about, for way too much money and never really gotten my “money’s worth”.

I just never wore much of what I had bought and by now, most of the clothes were simply not my style. I ended up purging 3 big bags full of clothes which I donated to the nearest drop box.

I did this another two times in 2021. Once in the summer and again in early December.

By now, I must’ve downsized to only about 50% of my wardrobe.

Oh my goodness did it feel good!

Can you imagine, my last purge consisted of a total of 6 very large bags filled with clothes I knew I would never wear. Among those items, I also had two bags full of shoes and accessories which I donated to family members to give away as presents for Christmas (whatever they deemed nice enough to give away – although all of my items were nice, even though I never wore most of it.)

I opted for donation rather than selling on E-bay because that entails a lot of work and I didn’t need to make money with these items. They constantly reminded me of my old self and they needed an eviction notice from me. I was happy that I gave it all away.

I will continue to do this in 2022. Purging my stuff feels freeing and if I can donate clothes to people in need, it really makes me feel good, and I know I am doing something positive. Just think of the woman who will end up with one of my blazers which she can use to wear going to a job interview 🙂 This literally warms my heart.

I still continue to work towards a very streamlined and minimal lifestyle. Now, mind you I don’t want to overdo it in terms of purging too quickly but I definitely have found my path. This path is one where I live with less, because less is more. What I don’t necessarily want to do is reduce my lifestyle to the point where I might regret it. So far, I have not!

2. Personal Finance

On the note of personal finance, I also made improvements.

In November it had been now three years since getting my financial life in order. Three years since I was a financial mess! Three years since I first picked up knowledge about paying down debt, making a budget and saving towards my financial future! I still get goosebumps when I think back to the times when I had no control over my money. I never want to feel like that again. Ever!

READ: HOW TO PAY OFF CREDIT CARDS FAST

2021 was a time of deep reflection, sometimes still filled with guilt and shame. Even though I had moved on financially, and can say that much has changed for the better for me especially with the relationship I have with money. I now live an abundant life. No longer do I feel that I lack the financial means to go after what I want in and from life.

READ: HOW TO ATTRACT AND MANIFEST MONEY INTO YOUR LIFE

2021 was a year in which I from time to time still made some stupid purchases that I could have done without. Some cheap stuff here and there. However, the good thing is that I let my credit card accrue any large amounts. I always managed to pay off my credit card in full – or kept the amount low enough so that I wouldn’t be overwhelmed at month’s end.

I tried the cash envelope method for a few months again in 2021 and I liked the idea. However, I quickly realized that I was missing out on cash rewards especially in areas of groceries, recurring bills and other items.

I STILL have two credit cards.

READ: 5 BENEFITS OF USING CREDIT CARDS

One I use for almost all purchases, the other for subscriptions and larger purchases such as educational purchases (for example, this blogging course!).

Both credit cards give me rewards, one in the form of actual cash back, the other in form of money that gets credited once a year. I prefer the actual MasterCard cash rewards credit card much more for obvious reasons. The other card is a regular American Express with no yearly fee, and lately I have been contemplating to upgrade this one to a better one, even if I have to incur a yearly fee. I am looking for better rewards. I will update on this one if I ever make the move. As of now, I keep it as it is.

In 2021, I found myself using my credit card but also using cash here and there.

For record keeping it is of course a convenience to use my credit card. When I do my monthly reconciliation, I just look at the statement and boom – all the data. It saves time.

However, I have to admit, that it’s still more tempting to quickly pull out my credit card.

I might revert back to the cash envelope method next month again because for the next 6 months I want to definitely speed up my savings rate.

READ: 5 REASONS WHY THE CASH ENVELOPE METHOD IS AWESOME

I do have some sinking funds that I am saving in cash but even with that, I find that if you have a high-yield-savings account, why not also deposit it there, even if I make pennies. Every penny counts in my books.

On the topic of saving and making money, I generated dividends from my investments in 2021. But I also got rid off a lot of investments out of fear of a real crash.

I know, I know, you might think this is bad but I am emotionally attached to my hard-earned money so I don’t want to lose it.

I have been watching the market and I have a feeling a deeper dip is in the works for us after the pandemic and enormous trillions that were pumped into the world economies.

Mind you, I still have some investments going in my TFSA (equivalent to the ROTHIRA) but here, the stocks have been in the basement as well. So I have been holding on. I did not spend much time on investing in 2021 but hope to get back into the groove of things this summer. If I only put a couple of hundred dollars away into the TFSA then that should already be good enough for me.

The downward phase is imminent in my humble opinion and when that happens, I want to make sure I am ready to jump in. No timing here 🙂

Last year, I was all about dollar-cost-investing and I still follow that mantra. However, I have dabbled into the Bitcoin ETF which was launched in Canada in early 2021. This one has been a sure roller-coaster ride. It doesn’t pay any dividends, so it’s just for growth. I don’t know what to think of it yet and I might do a review of it. Not sure though.

This year I am focusing on creating income streams. You know what Warren Buffet says:

“If you don’t create at least 7 income streams in your life, you will work until you die.”

Not something I would personally enjoy, really.

3. Contentment

The last topic I’d like to briefly touch upon is contentment. Early in the year, as I mentioned, I was still making quite the purchases. Yes, most of them were of higher quality and I have no regrets, but there were also many items I bought which I could have lived without.

Hello, Amazon Prime!

By now, I can statistically prove using myself as an example, that my purchase behavior directly increases when I have that monthly subscription. Luckily, I did not pay for a full year in advance. I was smart enough to just get the subscription as I “needed” items. But did I really need these items?

I will leave it at that.

Towards the end of the year, I learned how to become more content. I entered two malls before Christmas because of family and them wanting to check out the sales and I kid you not, I felt so displaced at the mall.

The feeling of seeing people shop, the stores full with so much merchandise, sale signs in every window, people frantically pushing towards the long line ups to pay for stuff (they probably don’t need!) was almost like a surreal experience.

Before December I hadn’t set foot into a mall in what it felt like an eternity.

Malls STILL don’t excite me anymore.

They are a money pit and pure temptation for an ex-Shopaholic and they are so stuffy (bad air ventilation systems, yuck!).

I have finally achieved the level of contentment. It is great and empowering.

When I buy items now, I think about them AT LEAST 3 months (if it’s a bigger purchase). If I cannot stop thinking about it, I will save and go ahead and buy the item.

Overall, I have been more content in 2021.

My 2022 No Spend Year

Let’s finally talk about the most important part of this post.

I had made the commitment to myself to have 2022 be a NO SPEND YEAR for me.

There are three motivators which enabled me to commit:

1. Minimalism

2. Personal Finance

3. Contentment

Yes, these three pillars are the basis for why I am committing to this challenge in 2022.

Of course other influences, such as people from the FIRE community and online personalities who live a frugal life have had their impact on me. Mostly however, I decided that minimalism, personal finance and contentment are the three pillars as to why I want to do the 2022 NO SPEND YEAR.

I want to continue to becoming a minimalist. I want to reduce my lifestyle, consumption, impact on the environment. I want to get rid off things I have which don’t give me value.
By simply doing this, I won’t have to engage in buying. The motto is to not accumulate new things that I don’t need or really value.

I want to continue growing in the area of personal finance. I am setting new goals for this year and quite frankly, I work too hard to be spending the money that I make on items that I don’t need!

Lastly, contentment. Since I realized that I can be content with the things that I have already, which I value and appreciate, I do not need to spend money on new things. If something of mine breaks, I will try to fix it first. I will be OK with the makeup I have and only replenish stock, when needed. I will be OK with emptying out our pantry first, before going on a grocery spree.

Lastly, I will be OK with not spending any money on frivolous things and embrace a sustainable year!

General Guidelines:

• Live on a budget and spend money ONLY on needs (shelter, food, hydro, etc.)
• Save as much money as possible.
• Try to increase income and/or develop secondary and tertiary income streams.
• Allowed to spend money on events/experiences that are valued/appreciated but ONLY if budget allows and can be paid for in cash.
• Buy high quality items if you really want to and save for them first (low buy!).
• Live a minimal (reduce) and content (reuse) year.
• Report yearly on feelings, mindset, temptations and successes.

If you cannot commit to a complete no spend year, try a low buy year!

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This post is about how a no spend year can help you save more money.

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