From loud budgeting to soft savings, these TikTok finance strategies are less focused on spreadsheets and more on mindsets. Here are the terms to know as we move through 2024.
Have you heard of the 100 envelope challenge? How about doom spending? With roughly 80% of Gen Zers and millennials turning to platforms like TikTok, Instagram, Reddit and YouTube for financial advice, a new flood of money-saving strategies have gained millions of views and changed the way that thousands of people approach their finances.
While traditional personal finance coverage and advice tends to be on the dry side, social media creators are all about making money chat authentic and accessible. From loud budgeting to soft savings, these strategies are less focused on spreadsheets and more on mindsets. Ready to dive in? Here are the terms to know as we move through 2024.
Popularised by TikTok creator Lukas Battle, loud budgeting means speaking up about your financial goals. While previous generations found it deeply uncomfortable to talk publicly about their finances (remember the episode of Friends where Rachel, Phoebe and Joey are too embarrassed to tell the other friends they’re broke?), Gen Z are rejecting financial shame in favour of an open approach to budgeting. In other words, it’s not just saying you can’t make dinner with a mate or turning down a destination wedding invite with a vague excuse — it’s explaining clearly that it’s not a financial priority at the moment.
It’s no coincidence that loud budgeting has taken off during a cost of living crisis, when people everywhere are feeling financially stretched. For a lot of Gen Zers and millennials, being open about trying to cut down on expenses not only makes sense but also allows them to share money saving tips and make budget-friendly plans, from booking a more affordable restaurant for a night with friends to taking advantage of 2-4-1 cinema deals.
The idea of a no-spend challenge is to help you get a grip on your outgoings. Spending money in some capacity is unavoidable — unfortunately “I was doing a no-spend challenge” won’t fly as an excuse for why you’ve not paid your rent or electricity bill — but a no-spend challenge is about avoiding unnecessary spending for a set period of time. That could be one day a week on an ongoing basis or for a longer chunk of time (just make sure you’ve thought ahead so you’ve got your essentials covered before you start).
The point of a no-spend challenge is to help you explore your relationship with money, spot places where you overspend, cut down on impulse buys and free up money to put towards your goals. For example, you might realise that a coffee made at home tastes better than the one you grab from Starbucks each morning, or that you’ve already got a top in your wardrobe that’s almost identical to the one you were about to order online.
The no-spend challenge has taken off on TikTok, with creators sharing their progress and tips for making it through different versions of the challenge, including ideas for free activities and self-care tips.
In a world where touch pay is so common that many people don’t bother carrying a purse or wallet, it seems surprising that a cash-focused challenge has taken off online. But that’s exactly what the 100 envelope challenge is: an updated version of the long-time budgeting strategy of putting cash in envelopes marked for different things — bills, food, luxuries — to help you monitor your monthly spending. The twist with the 100-day challenge is that you build up your savings across the 100 days, starting with $1 (or £1, for those of us in the UK) and leading up to $100 on the final day of the challenge, so that you end up with $5,050 in savings.
It might not seem like a financial trend but the return of the capsule wardrobe has its roots firmly in the world of budgeting. Regulars on TikTok and Instagram might have noticed that more influencers on the platform have moved away from wearing a new look in every video, instead rewearing a small selection of pieces. In fact, creators like Invest with Nat have shared how cleaning out their closets has allowed them to cut back on impulse fashion buys, keeping only a small selection of neutral items and relying on rental platforms to freshen up familiar outfits. It’s no longer cool to be seen to be constantly consuming. 2024 is all about a cost-effective, climate-conscious approach to getting dressed.
A recent Intuit report found that three in four Gen Z would rather have a better quality of life than extra money in their banks. That attitude of preferring experiences to stuff is at the heart of the soft savings approach, which is about using your finances to support your quality of life in the here and now, rather than putting all your funds away for a rainy day. Soft savings is part of the #softlife trend: embracing comfort, low stress and personal growth and rejecting hustle culture. Soft savings doesn’t have to mean draining your bank account; it’s more about prioritising your spending to make sure you’re living a life that feels meaningful to who you are today, instead of scrimping so religiously that you leave all your life-enhancing experiences until retirement. In other words, the goal is to design a budget that makes you feel good. An example of a meaningful purchase could be heading off on an adventure abroad, investing in a course or buying yourself a really cosy set of sheets for your bed.
When soft savings gets carried away, it can turn into doom spending (or what we used to call retail therapy). When the world feels overwhelming, buying something can offer a feel-good hit of dopamine and endorphins. But while shopping might seem like a low-effort, quick way to self-soothe, it can lead to double the stress down the line when your bank account is running dangerously close to your overdraft and you’re still weeks away from payday. An impulse buy every now and then can be harmless fun but if you’re finding yourself doom spending most weeks, it might be time to revisit the no-spend challenge.
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