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Financial detox

Photo of a person with a laptop, paperwork and a calculator.
Image Credit: Chainarong Prasertthai

The term “detox” can be used in many aspects of our lives, including our personal finances.

Detoxing is a process or period of time in which one abstains from or rids the body and/or mind of toxic or unhealthy substances. By detoxing your finances, you are willing to learn how to spend your money wisely, create balance, and forge a better life.

When it comes to a detox diet, there are some steps we must take in order for the process to be successful. The same formula applies to a financial detox. Here, I will frame the steps that will help you with your detox process.

1. Set a timeline

If this is your first time trying a financial detox, I suggest you start with one week. If a week proves to be a good start, keep the same time frame until you want to increase it to a month or even a year.

2. Plan for your savings

Since you are cutting your expenses, having a plan for those savings is the next step of the financial detox.

“A financial detox is an interesting way to view your spending habits.”

3. Budget for “X” expense

You don’t have to cut all your expenses all at once. If you choose to have a detox week but every Friday you hang out with your friends at a bar after work, plan that Friday to hang out at a coffee shop instead of a bar. That way, you are still enjoying your time with your friends while reducing your expenses.

4. Walk or carpool

Going to work, college or just visiting friends usually implies the use of transportation. Whether you use public transportation or your own car, a good way to save money is by walking to your destination or by planning to carpool. This change will not only help your pockets, but also your health because you are doing more exercise. It can also help the environment by putting one less car on the road.

5. Find cheaper, alternative social activities

No one said you must go back to isolating yourself. The purpose of this process is to find other activities you might enjoy that don’t cost that much and, in some cases, you don’t have to spend any money at all. Here are a few suggestions:

  • Visit the local library
  • and borrow a book
  • DIY something from Pinterest
  • Have a spa day at home
  • Have friends over and cook together
  • Host a video game or movie night

A financial detox is an interesting way to view your spending habits. It might help you identify areas where you may be wasting money and other areas that might require your focus.

If you are interested but don’t have an idea on where to start or how to do it, let me give you examples of the detox weeks I started with:

Week 1: Detox for food spending

This week, I avoided ordering food or eating out. Instead, I put together a meal plan for the week and I went to the grocery store to buy all the ingredients I needed. I ended up spending less and eating healthier that week.

Week 2: Detox for entertainment spending

Back in my country, I used to have sushi with my friends every Saturday. Sushi is a very expensive meal, so to reduce my expenses, I decided to invite my friends over and cook for them. We still had fun while enjoying the dishes that I was cooking for them, and my expenses decreased almost in half.

Week 3: Detox for clothing

Just like detox for entertainment might require more than a week, detox for clothing can’t be accomplished in one week either. However, here are some tips for you to save money. The first step to spending less in this area is to admit that, no, you don’t need that new pair of shoes or a new dress. Instead, clean out your closet and try to put together new combinations of outfits to use the clothes you already have in your wardrobe. Invite some friends over and have a fashion show at home. Their opinions will also give you many new ideas on how to make new combinations.

Week 4: Detox for savings and debt

Saving money is very important, and I will never change my perspective on that matter; however, getting rid of debt is also important. If you have been saving money from your detox weeks, use that money to pay debt instead of increasing your savings. Being able to live with almost no debt is as good as knowing that you have a chunk of money in your savings account.

With this experiment, you will be able to create an opportunity to change your mind set regarding your current habits. Sometimes, we are afraid to change something in our lives because we feel that we won’t be able to control the process, but starting with small steps (one week every month) will lead us to the goal we want to achieve.

Do not underestimate the massive power that lies in little choices/actions done consistently over time. And remember, get creative, have fun, and most importantly, improve your financial habits forever.