Navigating Dry January: A Sobering Approach to Financial Wellness

New year, new me - right? As the New Year begins, we are all about making new resolutions. One of the biggest resolutions is Dry January, an annual tradition that started in the UK but spread worldwide. It is a month-long commitment where individuals pledge to abstain from alcohol. While the health benefits of this challenge are widely recognised, it's also an opportune time to reflect on and recalibrate various aspects of our lives, including our finances.

The history of Dry January

The roots of Dry January can be traced back to the UK in the early 21st century. The official campaign was launched in 2013 under the auspices of Alcohol Change UK, but its roots go back to 1942 when Finland held Sober January to support the war against the Soviet Union.

The idea was simple but effective: encourage individuals to abstain from alcohol for the whole of January to promote healthier habits and raise awareness of the potential risks of excessive drinking. According to Alcohol Change UK, 70% of participants sleep better, 66% have more energy and 86% save money.

The muse of the campaign is the first marathon of Emily Robinson in 2011. She signs up for her first half marathon and, to make her training easier decides to give up alcohol in January. After this break, she notices physical and mental changes in herself. Around the same time, Nicole Brodeur published A good time to dry up about her first Dry January, motivated by a friend who had been doing it for several years.

While many people, publicly or not, have taken a month off alcohol in January, Emily was the first to turn it into a campaign and trademark it. Dry January started with 4,000 people; in its 11th year, 200,000 people are expected to participate in 2024.

Dry January helped me to cultivate and nurture stronger friendships with the people who mattered, pushing me out of my comfort zone. Not drinking has allowed me to build up confidence.

Cara, Alcohol Change UK

One month to become wealthier and healthier

Dry January isn't just a challenge; it's a transformative opportunity beyond personal well-being to encompass financial health. This month-long commitment is a catalyst for becoming wealthier and healthier at the same time.

Financial clarity through sobriety

Our financial lives are begging for a detox. Just as Dry January encourages us to rid our bodies of toxins, we can use this sober mindset to achieve financial clarity. Remove the haze of impulsive spending and budget indiscipline, and focus on your financial goals.

Start with alcohol - it's Dry January. Download an app, make your own Excel spreadsheet or do the maths in your head. The highest income group (top 10%) in the UK household spends £27.50 a week on alcoholic drinks, almost £1450 a year. This means you could save £43,500 over 30 years and 6-8 times more if you invest. Take that amount and make sure it stays in your wallet. But make sure you understand that saving goes beyond the cost of alcohol. People tend to make more impulsive purchases when they are drunk. Brits spend £4.46 billion while under the influence of alcohol.

Mindful spending and building sustainable budgets

A critical aspect of financial wellness is understanding where our money goes. Spending on alcohol, from happy hours to fine wine, can add up quickly - or you don't even remember paying for it. 37% of UK adults regularly receive parcels they do not remember ordering until they open them.

Dry January provides an excellent opportunity to assess these costs and redirect these funds into savings, investments or debt reduction. By reducing discretionary spending on alcohol or other purchases, you can free up resources for more effective financial endeavours. To understand more effectively where these expenses are going, you can use financial applications that will always be with you and communicate with your banks.

Health is wealth

Beyond financial savings and well-being, Dry January brings health benefits to your body. Six months after taking on Dry January, 70% of people drank more healthily. The impact won’t stay for a month.

Taking a break from alcohol can provide your liver rest and recovery, improve your sleep pattern (with a better sleep quality that comes with it) and immune system boost, and refresh your skin. As long-term health improvements, in a financial matter, reducing alcohol consumption potentially reduces healthcare costs. This dual investment in health and wealth sets the stage for a more secure financial future.

More than a health challenge

If you recognise Dry January as more than a health challenge, it will be an opportunity to detoxify your financial and health habits. You will make conscious choices, build a long-term wealth management foundation, and do something good for your body and health. Combining the discipline of a dry month with a clear financial strategy will create a prosperous and financially sound future. So when you raise your non-alcoholic drink this January, raise your glass to the financial clarity and well-being that comes with your commitment to a sober start to the year.