I’ve had a spending problem for the past few years. Like the majority of Americans, I bought into the whole consumer lifestyle and bought “stuff” to make myself happy. I came to realize, though, that spending money doesn’t make me happy. It satisfies my short-term wants, but at the end of the day, it’s just “stuff.” I started the Zero Day Challenge to help combat my spending problem and achieve my goal of reaching financial independence by age 40, and early retirement by 45. I never imagined that I would decrease my spending by more than $18,000 per year.
Zero Day Challenge
Before I get into how effective the Zero Day Challenge is, I need to describe it and why it works. “No spend days” are fairly common in the Financial Independence Retire Early (FIRE) crowd. People will sometimes do a 7-day no spending challenge. This means they will try and survive 7 days without spending any money.
This is a great way to reduce spending, especially if money is scarce. It forces you to efficiently prioritize how you buy food. It forces you to find a sense of fulfillment outside of buying things. These no spend challenges come and go — but why not make them part of your everyday routine?
Doing a year-long or even life-long no spend challenge is ridiculous. Typing this, I know somebody has either already done it, or will now try it. By restricting yourself to not ever spending money, you are doomed to fail. But what if you instead turned not spending money into a game? That is the Zero Day Challenge.
In the Zero Day Challenge, we gamify these no spend days. I refer to them as “zero days.” Every day, you track your spending. If you didn’t spend any money, it counts as a “zero day.” You track how many zero days you earn per week, per month, per year. As a competitive person, I always want to improve my numbers. This means the better I am with the challenge, the less money I spend.
6 Months Of Progress
I’ve officially been tracking my spending in the Zero Day Challenge for the past 6 months. At this point, I thought I would be on my own, but a few other people have joined me (I hope you share your experiences as well!), which is incredible! I can tell you that the challenge works.
It hasn’t been easy. Last year, my discretionary spending was upwards of $3,000 per month. Can you imagine spending $3,000 on food, entertainment, and shopping? I can’t even tell you what I spent all of that money on. At first, spending less money on “stuff” made me a little depressed. I was so attached to spending money that it affected my emotional state. But as the days and then weeks went by, something amazing happened.
I started going outside and found ways to have fun on my own. I stopped relying on spending money to give me happiness, and started drawing it from creating things. I spent more time with other people, and enjoyed nature. As the months went by, I stopped buying the crap that had previously been controlling me. Now, I only really buy things as gifts for other people. At this point, the following two things have happened:
- I significantly decreased my monthly spending
- I realized that buying “things” makes me less happy
Significantly Decreased My Monthly Spending
When I say that I have significantly decreased my monthly spending, I am not being hyperbolic. I decreased my monthly spending by $1,536. It takes $1,500 per month to max out your 401(k). I’ve managed to save more than the maximum contribution and it only took me 6 months to change my ways. If I invest this money in the stock market for 42 years and earn 7% post-inflation returns, it will be worth $4.6 million. Given my Financial Independence (FI) target date of 2030, it will be worth closer to $415,000. This may be enough to push me over the FI hill.
I base this calculation on my 2016 Spending Analysis. To give you a TLDR: I spent about $57,000 in 2016, which equals $4,750 per month. For the past 6 months, I have spent a total of about $19,000, which is $3,170 per month. This is where my savings comes from. Yes, my spending was ridiculous and it is still very high. But I’ve decreased my spending by about 33%. Decreasing my monthly spending by 33% is absolutely massive. In fact, it is life changing.
Imagine having 33% more money at the end of the month. You can put this towards your consumer debt, car payment, or even your mortgage. You can use it to add a very large cushion to your retirement accounts. Finding an extra 33% of income is absolutely huge, I cannot stress this fact enough.
Buying “Things” Makes Me Less Happy
I don’t mean this as a negative. I don’t go to the grocery store, lament the terrible prices and weep in my car because I spent $120 and lost out on a zero day. What I mean is that I no longer find myself swiping my credit card in an attempt to solve my problems and unhappiness. In my first trimester summary, I talked about how I was getting depressed. Loneliness sucks. (Thankfully, I’ll be with Zero Day Financée in September.) But over the past 6 months, I’ve tried breaking out of my shell, doing more social activities, and overall, finding more meaning outside of consumerism.
I no longer have the urge to buy random crap to make myself feel better. I’ve completely stopped online shopping (except for when I need to buy gifts). I don’t really derive value spending money on useless crap. Six months ago I would have, but now I don’t. And that’s the point of the Zero Day Challenge. You do not need to be a slave to consumerism. You don’t need to ruin your financial future just because marketers at mega corporations tell you to buy their product daily.
Numbers And Trend Lines And Graphs, Oh My!
Okay, I’ve talked the talk, now it is time to show you that I’ve walked the walk. I’m not going to post my credit card statements here for obvious reasons. However, I will show you what my Zero Day Challenge spreadsheet looks like. If you are interested, sign up for my mailing list and I’ll send you a copy!
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Below you will see screenshots from this spreadsheet. I’m color blind so I might not get the colors right, but the blue line is my actual spending. The orange line is my projected spending to hit my monthly spending goal of $1,325. This does not include my rent and car payments, which are $1,625 total per month.
January 2017 Zero Day Challenge Spending
January was my first month of the Zero Day Challenge. I wanted to set a very high bar for myself! I basically lived in my apartment and did nothing. This was pretty boring. The weather didn’t help — it was really difficult to go outside for a walk. Plus, exploring D.C. can be a pain in the ass because I live on the Red Line, and with the current repairs, you’re lucky if you get a train. As a bonus, I did stay significantly under my spending goal.
February 2017 Zero Day Challenge Spending
February was a little easier for me. We can see that three or four fairly large expenses pushed me way over the trend line, and I never recovered. This was equipment for my bug in bag. (Basically a physical emergency fund that you can rely on in the event of a disaster like an earthquake or an extended power outage.) I didn’t hit my goal, and I didn’t have many zero days either; however, I was definitely a little happier, which was a huge plus.
March 2017 Zero Day Challenge Spending
Let’s just say that March was an expensive month. I bought Zero Day Financée a Nintendo Switch. I also got birthday gifts for my sister, and spent a few hundred $$$’s on new work clothes. Those are the three large expenses that you see on the chart. If I hadn’t made those expenses, I probably would have saved about $1,000 or so. I obviously didn’t come close to meeting this goal. Again, I was still happy which is good! The other good thing is that without those expenses, I would have been under my goal spending for the month.
At this point, we can start to see a trend. I’ve successfully eliminated a lot of those small, random expenses that creep up quite quickly. All that’s left are bigger expenses that I actually really enjoy. I’m glad that I made my fiancée and family members happy. It was worth every penny in my opinion, and I will gladly do it again.
April 2017 Zero Day Challenge Spending
April is a month where I came very close to hitting my target. I started off the month with a very large expense for my mother’s birthday gift. Then I spent another few hundred on my father’s birthday gift. Other than that, my spending was extremely good. Excluding those two events, I would have spent less than $1,000. I would definitely repeat them again, though.
Here is where things get very clear. I’m not really spending that much money anymore. Most of my expenses have evolved into small, necessary ones like food and gasoline. The large blips are for people other than myself, and I have no problem spending money on them. I will say that my dad’s birthday dinner was awesome.
May 2017 Zero Day Challenge Spending
May was another victory for the Zero Day Challenge! My spending will always start above the trend line because that’s when my car insurance hits. However, I stayed below the entire time, and even dipped down because I returned some stuff from Amazon. The interesting thing about May’s spending was that the previous two months are almost identical if I remove buying birthday gifts for my family members. I’m more effectively spending money on things that make me happy, though, which is the point.
June 2017 Zero Day Challenge Spending
June is a slight blip. I basically stayed over my target spending for the entire month. This month included purchasing my fiancee’s birthday gift and paying a ridiculous $180 E-ZPass toll fee. (I don’t understand why they can’t just charge your credit card when you go through — they must always pull large amounts of money in a single pass.) If I removed the birthday gifts + stupid toll fees, I would be very comfortably underneath my goal spending. Another almost victory!
First 6 Month Summary
This is my high-level summary for the year so far. My spreadsheet calculates all of this automatically — it even knows when there isn’t any data so it doesn’t award me successes for months that haven’t happened yet. I’ve hit my spending goal in 2 out of 6 months. I am way ahead of my targeted spending for the year, and I honestly don’t think that I’ll be able to recover. I’ve spent $9,144 so far and my goal is $15,900. I’d need to average $1,100 per month in spending to hit this. Not impossible I guess, but we’ll see how it goes.
Keep Calm And Take The Zero Day Challenge?
If you are like most people, you spend money unnecessarily. There are a bunch of little expenses that you probably don’t even know about. Courtney from Your Average Dough just showed her friend that she spends nearly $1,000 per year on coffee. Is the expense worth it? Maybe, maybe not.
Join me in the Zero Day Challenge! I’m on track to save more than $18,000 this year, a 33% lower spend rate than last year. Do you want to retire early? Do you want to control your spending? Are you drowning in consumer debt? Help solve your financial problems. All it takes is about 1 hour a month and a little determination. What do you have to lose?
And don’t just take what I say for granted, see what others have to say about the Zero Day Challenge as well!