Go on a Spending Strike

Groups and individuals go on strike to make a point. Going without food or going without a paycheck? That’s some serious commitment. Are you committed to getting your spending under control? Consider undertaking a spending strike. One of the things that I’ve learned is that it is easy to fall into bad habits and much harder to develop good ones. A spending strike might seem to be a pretty extreme solution to a problem, but it’s the very nature of the idea which makes it so effective.

So what is a spending strike? When you undertake a spending strike, you stop spending money. Period. The benefit to doing this is that you get out of the habit of spending money. Open up your checking account statement and figure out the total number of withdrawals. Divide that by the number of days in the statement. How many times a day on average are you saying ‘yes’ to spending? On the peak day in my last statement I said ‘yes’ to spending 15 times. 15? What the hell was I thinking? And one of those was a cash advance which probably led me saying ‘yes’ 2 or 3 more times. Like I said, bad habits are easy.

Stop saying yes to spending and go on strike. The length of time one can undertake a spending strike is going to vary by person, but for the purposes of discussion let’s consider a 2 week strike. Undertaking a spending strike to improve your financial health shouldn’t damage your financial health in the process, so there’s some preparation work that needs to go on before you begin.

Before you begin:

1. Identify all recurring bills which will be due during the strike period and pay them now or schedule payments.

If you rent, electric bill and car payment will be due in the next two weeks go ahead and either pay those now or schedule their payment. If you can pay them now, I recommend doing that. One of the advantages to that is that if you can view your checking account and credit card statements online, if any transactions do occur during the strike they will stand stick out like a sore thumb.

2. Stock up on food.

You need to eat right? A spending strike means no eating out unless you’ve got a gift certificate you hadn’t gotten around to using. I normally go to the grocery store 2 or 3 times a week (I live across the street from one) so buying 2 weeks worth of food is a pretty big change for me.

3. Fill up your tank.

Unfortunately you still need to go to work during the spending strike. I know it sounds crazy but just because you’re not spending any money doesn’t mean that you can get paid for sitting around. If you are going to need to fill up during the strike, that’s unavoidable. However, don’t buy anything else at the convenience store and do your best to eliminate any non-essential travel (you’re spending gas money on those trips right?). Consider riding the bus or car pooling during your strike. Who knows, you may find that riding the bus is a nice alternative and carry that habit forward after the strike.

4. Put away your cards and cash.

Keep a single card in your wallet along with an emergency cash fund. Unexpected expenses can come up and need to be dealt with. The goal of a spending strike is to break bad habits not punish ourselves. So if something comes up that needs to be dealt with, deal with it.

5. Grab a notebook to record your observations.

Every time you would have spent money on something make a note of it. Record what it was and how much it would have cost. Also take some time to record your thoughts about the strike or idea you have for saving money on an ongoing basis at work.

Morning latte $4
Lunch with Bob in accounting $12
Surfing magazine $5

6. Have fun.
Really.

When you’ve finished your strike, drop me a note and let me know how it went. I’ve done this exercise a few times and have learned something new each time.