There’s a viral trend encouraging limited spending in January that has taken TikTok by storm, but Toronto financial experts advise that real money-saving success requires sustainable habits.
During a time of high living costs, many TikTok users are embracing the “No-spend” challenge which involves cutting down on non-essential expenses, such as dining out and overpriced coffees. For example, TikTok user Francis Shad plans to spend an amount of $150 on restaurants and zero dollars on partying or shopping this month.
@francisshad.co Kicking off 2025 with a January No Spend Challenge! 💸 #NoSpendChallenge #financialliteracy #personalfinance ♬ original sound – Francis Shad | Finance + Life
POPULAR START TO THE YEAR
Now Toronto spoke to Torontonians participating in the challenge. Alicia Denapoli sees it as a necessary reset after the holidays.
“We tend to spend a lot over the holidays, so I think it’s nice for people to kind of take a break and catch up on their spending over the holidays, and essentially just kind of, you know, give their credit cards a break. So, I think it’s a great initiative,” Denapoli said, adding that she will be cutting back on shopping and purchasing non-essential items.
Similarly, Sairam Edugani is managing his expenses by sticking to a strict budget.
“I do have a budget. I usually spend around $200 for groceries. I usually don’t go out to have lunch except with friends, so mostly, I prepare food for myself at home. I have a proper schedule, so that helps me a lot to cut all the expenses,” he told Now Toronto.
Media personality and best-selling author of Happy Go Money Melissa Leong says money saving trends are particularly popular during this time of year, as people set New Year’s resolutions.
“One of the most popular resolutions, aside from getting healthy, is getting financially fit. Around this time, you’ll see, #financialcleanse or #frugalFebruary or #dryJanuary, but for money, and that is just a response, perhaps to new year, new you,” she told Now Toronto last week.
“Perhaps there was a little bit of over indulgence over the holidays, but this is the time where people really want to make some new goals around their finances. And I am totally OK with that, being a financial literacy champion, it’s a great time. It’s always a great time to tackle your money in a new way,” she continued.
REALISTIC GOALS ARE KEY
While financial experts support the challenge, they emphasize the importance of setting realistic expectations. Personal finance expert Barry Choi from MoneyWeHave.com warns against overly restrictive goals.
“I do think after the holidays and after people have spent a lot of money that it’s really amazing that they want to spend nothing. I think that is a crazy goal, but obviously there has to be some rules in place. If you run out of soap, I hope you’re going to buy soap,” he said to Now Toronto last week.
“Having a no-spend challenge is fantastic, but you need to be realistic, or else you’re going to set yourself up for disappointment,” he added.
Leong agrees, noting that restrictive approaches often fail.
“I don’t know about you, but I have not had good experiences with restricting anything in terms of any kind of goal, because it’s just not sustainable. Because eventually real life has to happen. You have to spend on things that give you joy, whatever it is you decide gives you joy,” she explained.
In addition, she says financial challenges can also act as a helpful way to reflect and set new goals for oneself.
“…Give yourself some time to catch up on some of those credit card bills, as well as maybe give you a little bit more perspective of what exactly is. What are my spending habits right now? What have they been and what do I want them to be going forward?” Leong said.
TIPS TO ACHIEVE FINANCIAL BALANCE
For those joining the challenge, Choi and Leong have offered financial advice on how to efficiently save money and build healthier money habits, starting with establishing a budget.
“…Make sure you’re setting up a budget first, because you can’t, all of a sudden, decide that you’re gonna start spending nothing. You need to see where you’re spending money first and then cut back,” Choi said.
In addition, Leong recommends understanding one’s financial history in order to establish an effective budget schedule and generate real progress.
“If you don’t look at your bank accounts, if you don’t understand how much money is coming in and how much money is going out and exactly where, then you cutting back and sacrificing things can become meaningless. It can become aimless, because you don’t really know what the impact of this is,” she explained.
The second tip she suggests is to set goals as to what you want to do whether that is towards reducing debt or allocating money into an emergency fund. Lastly, she recommends having peer support throughout the pursuit.
“I think it’s hard to have any kind of goal where you’re doing it by yourself. You don’t have a check-in, you don’t have accountability. And so tell someone, write it down, share it on WhatsApp with a friend,” Leong said.
“You don’t have to tell them how much money you’re saving or how much money you’re making, but tell them, I have a money goal, and I am going to check in with you in a week or two to see how I’m doing on that journey,” she continued.
