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The start of a new year is the most popular time to make one resolution or another. For many, this includes abstaining from alcohol for the first 31 days.
According to a new report from Morning Consult, 22% of adults are participating in Dry January this year, up five percentage points from previous years.
“I don’t even want to call it a trend anymore because it has staying power,” said Lindsey Roeschke, author of the report.
According to the study, most of those who took a break from beer, wine and mixed drinks were due to the health benefits. Some adults may be particularly motivated by the U.S. Surgeon General's recent warning that even small amounts of alcohol can cause cancer, Roeschke said.
Completely abstaining from alcohol for a month has become a popular way to develop better habits. It is credited with improving sleep, weight loss, and overall well-being.
But the financial savings are also significant.
How much money can you save?
“Your exact savings in Dry January will depend on your typical drinking habits and associated expenses,” said Douglas Boneparth, a certified financial planner and president and founder of Bone Fide Wealth, a wealth management firm based in New York.
“For some, skipping the occasional glass of wine could save $50, while for those who go out regularly, the total could rise to $300 or more,” he said.
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Fred Harrington, the CEO of Coupon Mister, a money-saving tips website, estimates that cutting out alcohol for a month could save between $300 and $1,000, depending on consumption.
“The savings associated with cutting out alcohol for Dry January can be significant,” Harrington said. “Even if you drink occasionally, you'll see a noticeable difference in your spending if you avoid alcohol for a month.”
In fact, according to Morning Consult, saving money was the third most common reason for giving up alcohol for a month. Money as the main motivator “increased in 2022 when inflation peaked,” Roeschke said.
Tracking your basic alcohol expenses is the best way to figure out how much you'll save by giving up alcohol, advises Boneparth, who is also a member of CNBC's Financial Advisor Council. The U.S. Department of Health and Human Services Alcohol Spending Calculator can also show how much you spend on alcohol each week, month or year.
A lot also depends on what you drink and where you live, said Boneparth. For example, a six-pack of beer might cost between $10 and $15 at a grocery store, while a single cocktail might cost between $12 and $18 at a bar.
“Bar prices in big cities are often higher than in small towns, and social habits – weekly happy hours, weekend getaways – also play a big role,” Boneparth said.
There could be an additional trickle-down effect of fewer ride-shares or food orders, and the likelihood of shopping online while drunk may be even lower.
“It's not just about the money spent on the alcohol itself, but also all the associated costs,” Morning Consult said Röschke.
Here's how to take advantage of these savings
“You can put the money you save from Dry January to good use by spending it on things like a gym membership, a new bike for exercise, savings or a vacation,” Harrington said.
Alternatively, this money could be well spent paying off debts after the holiday.
Most experts also recommend putting any excess money into an emergency savings fund. Even a few hundred dollars can go a long way toward providing financial security when unexpected expenses arise.
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