Deciding on how much to spend is never easy. We all have these preconceived gift giving negatives that come to mind and it is always important to remember...

A gift comes from you as a thought of your generosity.  It does not mean I have to spend the same amount on them that they have spent on me. It is not meant to show off the amount of money that I pretend to have.  It is not a competition with each other.  You don’t have to cover what it costs to cover your spot at the party/shower/wedding.

You cannot go through your life with an out of control budget! If you feel it necessary to give more than you can afford, reevaluate your monthly budget to take away things you no longer need.  Before we go changing your monthly budget, let’s go through a simple activity to decide what your budget for the year should be.

Grab a piece of paper and pen, start with the most important people in your life.  Don’t worry about the actual gift at this point, you can think about that after you decide on the amount you’re comfortable with. If you do not put a limitation on this before you begin choosing gifts, our retail therapy bug will kick in and you will always spend more than you can afford.

Break down the people in your life into groups. Make a list under each category of people (or events) you will need to purchase for:

Immediate family

Extended family

Close friends



Dinner party hosts

Party gift exchanges

Every year I say I will not be getting my friends or coworkers anything and then I end up doing it anyway.  Who am I kidding?  Learn from my mistakes, make a plan and stick to it.

Focus on your biggest expense, which should be your immediate family.   Before you decide on the total amount to spend on your family, write a reasonable dollar amount next to each name.  Generally, I spend more on kids and my parents than anyone else.  Divide your budget however you would like to, this isn't about what your sister does, it's about what you would like to gift and what you can afford.  There are still great gifts to be given on small budgets and many creative ways to make your giftee’s day!

Add up the amounts chosen to spend on all the individuals.  If it is something unreasonable that doesn’t fit into your life… start subtracting!  It may be best to shave small amounts off everyone or choose one person to get a smaller gift.  I personally have my budget set to 300 dollars for my immediate family, which includes my two brothers, their wives and kids.

Budget Tip: As you shop throughout the year, always keep the receipts. Write what you bought and how much it was next to their name on your newly created budget list.  Next time you see a deal, you can see who else is left to purchase for.

Extended Family.  My extended family does not get into a lot of giving. If yours does, consider doing a large gift exchange AKA Secret Santa, where you draw names out of hats in order to eliminate large amounts of buying.  You can also stick with small simple gifts that you would also share with friends and coworkers. Another option would be to suggest everyone sticks to an amount limit. It never hurts to throw an idea out there for your family to hear, they are likely in the same situation as you!

Friends/ coworker/ party hosts. Most of your coworkers and friends will love a crafty gift or a homemade treat, which can be fairly inexpensive.  Also, look out for small gifts that you can pick up throughout the year for your friends.    I have a relatively small budget for this sort of thing of $50 for everyone.  That’s 5 gifts for 10 dollars??  It can be done, be creative about it! Feel free to refer to my find the perfect gift article – where you can find a few tips about giving on a budget.

Party gift exchanges.  Look ahead see if there is an annual party you attend that does a gift exchange, budget for that too!  Extra events like these can sneak up on you and cause trouble.  My budget for these events is $50 per year.

Consider adding gifting as an expense line to your budget.

My yearly holiday gifting has added up to 400 dollars for the year! Although that looks like a large number, if I had not planned it would be a lot bigger!  A Gallup survey conducted last year that the average adult expects to spend 830 dollars on gifts during the holiday season!  That can be a pretty serve hit to the bank account at the end of the year.  The best way to plan for the holiday hit is by adding it to your monthly budget!  At 400 a year, I’d need to save $34 every month for the holiday season.  If you are the average spender, you will need to plan to save 70 dollars a month.  Instead of having a seasonal savings all year, I budget $100 per month for gift giving alone.  I know it seems like a lot, but I do spend most of it.  I have 11 close family members that I spend about $40 on for their birthdays.  After I subtract my holiday savings, I will l have about $24 left for crafty gifts or cards for my other loved ones in my life.

If you are interested in just saving for the season, many credit unions offer holiday accounts to help.  Saving is always beneficial if an auto payment is set up and the money is put in a specifically labeled holiday account. Be sure to read the fine print first!  Also, consider a separate savings account for gifting that you can have access to all year round.  This will help cover for unexpected baby showers, weddings, birthday parties and going away gifts!   

Budgeting for the holidays can be extremely overwhelming!  The sooner you start to take a look at the financial burden and find ways to adjust a budget to fit your life, the less stressful the end of the year will be!  We all know that financial goals become one of our biggest new year’s resolutions, due to the lack of control over our finances at the end of the year!  Avoid it and enjoy the holidays for what they really should be!

Now that you understand why you should shop early and create a budget for the holidays, it is time to pick out the perfect gift for each person on your list! .
Main Blog Photo: (C) Andrew Neel

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10/05/2016 9:42am

Hi there, I found your blog via Google while searching for such kinda informative post and your post looks very interesting for me.

06/23/2017 6:57am

People tend to sped a lot of money during Christmas season because they think that they have enough of it. Though it;s kind of valid to spend money, always see to it that you are just spending the right amount. Thank you for the tips you have posted. I need to read and embody this post because I am one of the million people who tend to spend too much during Christmas season!


It is amazing and nice blog. We can make gifts in home very easily. This blog is providing the many tips for makig gift in home. I will also try in my home. Gift is part of life and sign of love.

02/06/2017 11:11pm

The Christmas season had passed and fortunately, I was able to win budgeting for this season! I actually did the same thing, I grabbed paper and pen, and listed the persons I planned to give a gift! The selection process alone was not easy! I've listed names from the priority ones down to "not so" priority people. Knowing the enough money you have is really important! By the way, this will be very helpful to your readers!


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