You’re Not Alone — 51% of Americans Feel Pressure to Overspend on the Holidays
By: Life'S Unsexy Toolkit
Tags: Money, Personal Finance, Money Management, Holidays, Spending

Photo by freestocks on Unsplash

When I think of the holiday season, January through October, I think of holiday markets, family gatherings with mulled wine, and catching up with friends. But then, November comes, and the pressure starts to build.

These whimsical images are replaced by a ticking clock and a gnawing panic. What am I going to get people for gifts? Will it be enough? Will they like it?

This stress means I end up texting my family, asking what they want so that I am guaranteed a slam dunk. Foolproof right?

Wrong.

Over the years, it seems the lists I get back have morphed from thematic ideas that offer a range of options to instead be more reminiscent of the Santa Baby lyrics.

“Santa baby, I want a yacht and really that’s not a lot…Santa honey, one little thing I really need, the deed, to a platinum mine…”

You get the idea.

Essentially, I have dug my own holly-lined grave. I can either completely disregard the lists I explicitly requested or overspend based on the holiday budget I set for the year.

Joy to the world!

Last year, Americans spent an average of $942 on holiday gifts alone. Polls are mixed on whether people feel the need to compensate for not traveling this year through buying additional gifts or whether holiday spending will actually decrease due to greater financial constraints.

Regardless of which side of the equation you fall on, here are some things to think about when planning your holiday spending.

Know who you are buying gifts for

Before going on spending spree, know who you want to buy gifts for this year. Is it exclusively your nuclear family? Do you have a partner, and are you celebrating with their family as well? Or, do you have 20 cousins that you are super close to and want to send each a little something for holiday cheer?

Level setting on your “nice list” will help frame how much you have available to spend on each person. Or, if that does not leave you with a feasible amount to spend per person, you may have to trim the list.

Be honest about the discretionary funds you have available

If you have planned ahead and budgeted for holiday spending, great! You know what you have as a whole to spend on gifts. Distribute it as you see fit across your “nice list.”

If you do not have a separate budget for holiday gifts, where else can you pull discretionary funds so that you aren’t going into debt for giving? Can you zero out clothing this month? Are you able to reduce what you spend on restaurants or take out?

If you are concerned about your spending getting out of control, there are other creative ways to approach gifts. What experiences can you give for down the road — a hosted dinner party or a day of hiking together? Do you have a particular talent (cooking, knitting, whittling, etc.) that enables you to make any gifts?

If you don’t live nearby to share an activity later on and don’t feel you have a skill that translates well to a gift, consider setting a spending limit with your family. Or, do a secret Santa or white elephant gift swap, so you don’t have to buy as many gifts. Besides, it adds a bit of fun and games for the holidays!

Don’t forget to factor in wrapping, packing, and shipping

Unfortunately, I don’t have Rudolf, Dasher, and Dancer at my beck and call to deliver gifts to friends and family far away. Instead, I have UPS, USPS, and FedEx.

Depending on what you are sending, shipping costs can rack up fast. Make sure to give yourself a buffer in your budget to account for wrapping and delivery expenses.

Remember the true purpose and spirit of the holidays

The holidays are a time to celebrate those you love, appreciate what we have, and participate in thoughtful religious practices, for some.

You do not need to go into debt to do any of that.