Spending Freeze: Is Going Cold Turkey a Smart Way to Dig Out of Debt?

brokemillennialThe first time I heard about someone doing a spending freeze I reacted like any normal, slightly sarcastic, 24-year-old critic would. I muttered, “Yeah, that will end well” and threw in an eye roll for good measure.

A spending freeze (or, as some call it, a spending fast) is similar to the Atkins diet, except instead of cutting carbs, the participants cut out all non-essentials. No movies, no morning lattes, no dinners out, no happy hours, no cable, no new clothes — the list goes on and on. Money is only to be spent on what it takes to keep the lights on and food on the table. The cash one saves goes towards debt repayment or fattening a savings account.

To me, a spending freeze sounded akin to a yo-yo diet. It also conjured up images of Oprah’s “wagon of fat” (even though that episode aired a year before my birth). My first (strong) instinctive reaction to the concept was that people resorting to such extremes with their finances were setting themselves up for failure. It seemed only logical that periods of deprivation would lead straight back to bouts of fiscal gluttony.

Perhaps I Was Wrong

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15 comments on “Spending Freeze: Is Going Cold Turkey a Smart Way to Dig Out of Debt?
  1. Nike says:

    Spending freeze works for some people but I think it’s better to decrease spending little by little. I’m 24 and tried a spending freeze a few months ago so I could throw more money at my student loan debt. It worked for about two months before I ended up feeling so deprived I wanted to buy everything in sight and went on a shopping spree. I’ve revised my plan to include two interim budgets to slowly get myself to my goal.

    • Broke Millennial says:

      I’ve heard what you’re describing called a spending diet. That’s what I’d be partial too myself. I think it makes the habit a bit easier to form and sustain.

  2. The jury is still our from my perspective on whether or not this works well. For me personally I fall victim to what you resist, persists, and have a feeling I’d be a very unfun person to be around if I went on an all out freeze. That being said, I do try to evaluate from time to time what I’m spending money on and if that item was really necessary. For instance I used to buy magazines, but I realized I could so live without them and have so many other free options.
    Tonya@Budget & the Beach recently posted…Why Do We Work So Hard?My Profile

    • I am the same way as Tonya. If I cut myself off entirely, I will most likely spend more in the long run.

      What works for me is forcing myself to wait longer to buy the item that I want. If I delay the instant gratification side, then I most likely will be able to resist impulse purchases.
      Michelle @fitisthenewpoor recently posted…In Defense of My Gym MembershipMy Profile

    • Broke Millennial says:

      I’d probably become a hermit if I had to do a freeze. I love brunch and happy hours a bit too much! Instead I cut back in other places and resist the urge to splurge on clothes or things for my apartment.

  3. Hi Erin! This would be difficult for me so it’s not the way my husband and I got to be debt free. But your analogy of how it is like dieting is correct. If you go so extreme you didn’t really change your habits even if you pull an Oprah and get skinny for a while. The really only effective way to lose weight or lose debt is to change your approach and mindset–the the pounds and the debt falls away naturally. I like what Newell Jones said when she said it got to the point where she liked NOT spending and the feeling it gave her as much as she used to like to spend. When that happens you KNOW you’ve made huge progress. ~Kathy
    Kathy @ SMART Living 365.com recently posted…Five Ways To Slay The Succubus of Crippling DebtMy Profile

  4. Agreed with Tonya and Michelle. I tried cutting eating out cold turkey last month and it was a huge fail. I need to “ween” myself off and build up solid (and positive) spending habits.
    La Tejana @ Debt Free Tejana recently posted…Uncle Sam’s Surprise Punch in the Gut- aka Tax TimeMy Profile

    • Broke Millennial says:

      I feel the same way about chocolate 🙂 Doesn’t have much to do with my spending, just something I can’t seem to quit cold turkey!

  5. We used to go on spending freezes all the time….until our kids started growing up. Now it’s impossible because we’re always running out of milk or bread or something!
    Holly@ClubThrifty recently posted…My Frugal Bathroom Cabinet RemodelMy Profile

    • Broke Millennial says:

      I imagine it would be a pretty difficult task to do with children. The more people you add the tougher it’s going to be!

  6. That’s tough. In a perfect world going ‘cold turkey’ is great, however when a person or family is cutting spending, the biggest part of the change is psychological. THAT is the part that takes time to change more than just the raw dollars and cents.
    Big Guy Money recently posted…The Shopping HordeMy Profile

  7. Broke Millennial says:

    If only we could all be raised to be fiscally responsible so behaviors don’t need to drastic changes later in life!

  8. Pokiesnet says:

    Is it possible in this age of economic turmoil? Spending freeze sounds like a nightmare for us now. And Turkey’s condition is indeed controversial.

  9. JessDarb says:

    I’ve had some success doing spending freezes in categories. For instance, I’ve gone two months without buying lunch or coffee during the work day (brown-baggin’ it!), while still allowing myself to buy a new book or go see a movie every once in awhile.

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