It seems like everywhere I turn I hear about people doing a spending freeze. They seem to be the next big thing in money management. Maybe it's just me, but I can't seem to get into the idea of a spending freeze. In case you haven't heard of them, basically for a set amount of time you don't spend any money. Some people do a week of no spending and some will do a spending freeze for up to a month. At the end of the month, you have a bunch of money leftover that you didn't spend.
In theory, it sounds really good. Go a couple of weeks without buying things that aren't necessities and then have money to spend on other things. I have seen a lot of people do this in October or November to pay for Christmas or do it April or May to save up money for a vacation. So why don't I love this idea? A couple different reasons.
I prefer to save a little bit all year long instead of a large chunk in a short period. I know this is a little harder to do, but I have mentioned my love for bank accounts and how we have so many. By saving $10 a week we are able to save for Christmas throughout the year instead of having to rely on a spending freeze. The same goes for a vacation. If I think it is important enough to save for then I try to make sure I have a bank account for it and save every week. Even if this just means putting $5 in an account each week. The small amounts add up and I am planning all year long.
I also feel like a spending freeze starts out with a bunch of spending. All the articles I see always recommend starting out with a huge grocery trip and filling up your car with gas. If you send me to the grocery store to buy food for a month I will probably overspend. I will be afraid we will run out of things and over buy. Plus, I feel like I would want to go back to the store for some fresh fruits and veggies. I constantly find things I am out of and it's not uncommon to for me to go to the store twice in a week.
So how do you skip the spending freezes but still have extra money? My favorite way is by automating our paycheck. By breaking everything up into the categories we can easily control our money. We use this to pay cash for cars, save for Christmas and vacation, and for paying the bills. Because we never actually see the paycheck it is hard to overspend it. We may overspend in one category occasionally, but then we just reassess and see what we need to do differently.
Another way we are able to save extra money is by using the cash envelope. We have a set amount of cash in each envelope and when that is gone it's gone. I don't have to worry about overspending and needing extra cash the next month. This is a great way to get rid of the daily overspending. We each have personal money that we get and once you have been through it there isn't any more left. Starbucks, lunches out, and toys we want all need to be paid for from our personal money.
If you want to gather money quickly for Christmas or Vacation you can sell things. I don't know about your house, but mine is constantly full of things that we really just don't need or use. I have made a decent amount of money by selling things at consignment shops, having a yard sale, or even listing things on a Facebook group.
Another great way I have saved up some extra cash quick is by cleaning out the pantry and freezer. I find meals that we can make and can usually pick up very little at the grocery store that week. It's amazing what I find hiding in our pantry.
By planning ahead of time and making small sacrifices throughout the year to save instead of large sacrifices for a month I feel like we save just as much. I would much rather skip Starbucks every day but go shopping every week. What about you? Are you a big fan of the spending freezes or do you skip them?