You might be sticking to your New Year’s resolutions of improving your fitness and eating habits, but are you paying attention to your financial habits? If you are wondering how to pay off debt, improve your spending, and set yourself on a path to financial success, a financial fast might be a good idea.
What’s a financial fast?
A financial fast is a short-term ‘financial cleanse’ that helps you get your finances back in shape. The idea comes from the 21-Day Financial Fast: Your Path to Financial Peace and Freedom. The short spans over three weeks, and some of its main points are that you should:
- Only pay for items with cash
- Only buy what you need
- Keep a spending log to track your purchases
- Pick a way to become debt-free
- Learn how to avoid overspending on college
- Create an emergency fund
Pros and cons of a financial fast
Here are some of the advantages and disadvantages of a financial fast:
Pros of a financial fast
Advantages of the fast financial include:
- Taking control of your finances and saving money
- Reducing your credit card charges and, as a result, money owed in interest
- Gaining awareness of your existing spending habits
Cons of a financial fast
Disadvantages of a fast financial include:
- Serious debt problems can’t be solved in 21 days—if you immediately go back to your old ways, you’ll be back at square one
- It calls for a lot of change in a short amount of time, which could be off-putting for some
- It doesn’t focus on positive credit card habits, which can raise your credit score
Four tips for financial fasting success
Here are a few tips for making your financial fast a success:
- Have a support group: It’s essential to surround yourself with people who support your financial goals. So, you may need to create boundaries with that friend who’s always trying to convince you to skip the gym and instead come over for pizza and beers. Tell your friends and family about your finances quickly and tell them how they can be supportive (i.e., not inviting you on a shopping spree).
- Avoid spending triggers: Avoid any triggers that could make you spend frivolously. For example, if seeing influencers and ads on Instagram makes you want to pay recklessly, consider deleting the app for a few weeks or setting a time limit to lessen your doom scrolling.
- Create a budget: Compare your take-home income against both your fixed and variable monthly expenses. Are you making more than you’re spending? If not, you may want to tweak your spending habits and focus solely on the essentials (see below). Budgeting isn’t a one-size-fits-all approach. There are several different budgeting methods, including the 50/30/20 rule, which suggests putting 50% toward what you need, 30% toward what you want, and 20% toward savings and debt repayment, and the envelope system, which have you set aside cash in different envelopes by category and allows you only to spend what’s in each envelope.
- Focus on essentials vs. wants: Regardless of the budgeting approach, you’ll want to minimize spending on desires over necessities. There’s a big difference between what’s essential and what’s discretionary. Take time to focus on the things you need to spend money on, like groceries and rent, and the things you could probably give up for a while, like fancy dinners out and extra-foam lattes. Pull out that copy of The Joy of Cooking your old coworker got you for the holidays and work on your French press skills instead.
By Stefanie Gordon
Stefanie Gordon is a content strategist with over a decade of professional writing experience. She specializes in content strategy and creation for large and small businesses in finance and technology. She is a former financial journalist who has worked in digital marketing for the last several years.
