How to Manage Holiday Gift Expectations

No one wants to come across as Scrooge during the holidays, but without managing holiday gift expectations, many people wind up saying, “Bah Humbug!”

When we fail to manage holiday gift expectations, we tend to spend more than we should, and find ourselves in debt well into the new year.

Both are outcomes no one wants.

Take a look at these findings from LendingTree’s 2022 Holiday Debt report: 

  • “In 2022, 35% of Americans took on holiday debt, down a tick from last year’s 36%, but the average amount among those who took some on this year is $1,549. That’s up 24% from last year and is the highest in the eight-year history of the LendingTree holiday debt survey.” 
  • “The percentage of holiday debtors who say it’ll take five months or more to pay off that debt rose significantly, too, going from 28% a year ago to 37% today. There’s never a good time to carry debt, but this is a particularly bad time with interest rates at record highs.” 
  • “63% of those who took on holiday debt didn’t plan to do so, up from 54% a year ago.”¹

When we go too much into debt, we often cut back on how much we save for retirement and everyday emergencies. 

This is a huge mistake!

So, why do we do it?

According to Everyday Health, “A lot of us have high expectations when it comes to the holidays. If you have to cut back on gift-giving or other seasonal festivities, [financial psychotherapist Alex Melkumian, PsyD] says: ‘This may bring up feelings of shortcomings and being less than.’”²

Let’s just be honest here.

Sometimes we overspend during the holidays for this very reason. We don’t want to feel less than.

We don’t want to give our kids less. We don’t want to come up short during the gift exchanges. 

It doesn’t have to feel this way.

The key is to manage holiday gift expectations. It may feel awkward the first holiday season you try, but, as the years pass, it will seem normal and expected.

Here are 10 tips to help you manage holiday gift expectations.

#1 Know Where You Stand Financially

holiday gift expectations

Before you spend a cent on gifts this year, you need to take a good hard look at your finances.

  • How much discretionary income do you actually have? 
  • How much debt do you need to pay off?
  • What can you responsibly spend this holiday season?

Be honest with yourself about what you can and cannot afford. 

[Related Read: 10 Ways to Avoid Taking on Holiday Debt This Year]

#2 Remind Yourself Why

holiday gift expectations

Another way to manage holiday gift expectations is to remind yourself why – why you can’t spend over X amount.

Go back to step one. You know what you can spend without throwing your finances into a tailspin. 

When you feel pressured by others to spend more than you know you can, remember why you are buying gifts in the first place. 

Gift-giving shouldn’t be something that you are forced to do. It should be something you do to show you care.

Remember, you can’t buy love.

#3 Set a Budget

holiday gift expectations

Before you set your gift budget, consider the other items you’ll need to pay for during the holiday season.

Will you travel? Will you host your family? Are there traditions that you must follow?

Add these items to your budget.

The remainder of your budget is for gifts.

#4 Create Gift Boundaries

holiday gift expectations

Now take that holiday budget and make a list of all the people you plan to give a present to.

Decide how much to spend on each person on your list.

This is also known as creating gift boundaries.

For example, I’ll spend $150 per child and $20 per teacher.

#5 Make a List – Check It Twice

holiday gift expectations

It is helpful to make a list of all the people on your Christmas list, alongside the amount you plan to spend on each person.

Keep a detailed list of what you buy for each person and how much you’ve spent.

Tip – Use the notes feature on your phone to keep track of your list. Or download the app Santa’s Bag to keep track of gift recipients, present ideas, and individual budgets.

It is easy to get carried away with holiday sales only to discover you bought two things for one person and nothing for someone else. Or you overspent on someone.

#6 Be Honest

holiday gift expectations

An effective way to manage holiday gift expectations is to simply be honest.

Be honest with your kids about your gift boundaries.

Let kids know when they ask for gifts that are outside of your holiday budget.

Be honest with your family about your gift boundaries.

Speak up and let family members know you only plan to spend around $30 on each person this year.

You may be surprised to find the rest of your family members are thankful.

#7 Go All In with Group Gifts

holiday gift expectations

If someone you love really wants a gift that is outside of your budget, ask if anyone else would like to go in with you.

Group gifts are a great way to alleviate financial pressure while still ensuring your loved one gets something they really love.

For example, my sibling and I went in on a group gift for my elderly parents one Christmas, and they were thrilled. They much preferred the one nice gift from all of us to a bunch of small things they didn’t really need or want.

Similarly, if your kid has a present that she has to have that is not budget-friendly, mention it to aunts and uncles. 

They may prefer to buy this present for her as a group gift.

#8 Get Creative with Alternative Gifts

holiday gift expectations

Managing gift expectations also includes managing what you believe you must get someone.

Sometimes people overspend because they feel as if they must get a fancy gift, such as a designer cashmere sweater.

Instead, think outside the box for other gifts your loved ones may like, such as experience gifts or the gift of time.

Give your brother and sister-in-law with a new baby a coupon for “free” babysitting. Take time to complete a special DIY project that you know your mother will love. Buy your nephew in college a month of a streaming service. 

It’s not the price that matters, but the gift itself.

[Related: 9 Ways to Keep Online Holiday Spending under Control This Year]

#9 Focus on Quality, Not Quantity

holiday gift expectations

Similarly, manage your holiday gift expectations by focusing on quality, not quantity.

You may dream of giving your kids a Christmas with dozens of presents under the tree, but that may not be financially responsible.

Instead, focus on giving people quality gifts.

It is much better to give one or two meaningful gifts rather than dozens of random gifts the recipient may or may not even like.

#10 Start Saving for Next Year

holiday gift expectations

If you struggle with managing holiday gift expectations, go ahead and make plans to start saving for the 2024 holiday season.

Create space in your budget to save a little each month for the holidays.

Better Prepare for a Life of Abundance in Retirement.
Check us out on YouTube.

Book a 401(k) Strategy Session


0 0 votes
Article Rating

401(k) Maneuver™ is offered by Royal Fund Management, LLC, which is registered as an investment adviser with the SEC and only transacts business in states where it is properly registered, or is excluded or exempted from registration requirements. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability. Royal Fund Management, LLC, is not affiliated with or endorsed by NASDAQ.

All investment strategies have the potential for profit or loss. Changes in investment strategies, contributions or withdrawals, and economic conditions may materially alter the performance of your portfolio. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment or strategy will be suitable or profitable for a client's investment portfolio. There are no assurances that a client’s portfolio will match or outperform any particular benchmark. Asset allocation and diversification do not ensure or guarantee better performance and cannot eliminate the risk of investment losses. Projections are based on assumptions that may not come to pass.

Images and photographs are included for the sole purpose of visually enhancing the website. None of them are photographs of current or former clients. They should not be construed as an endorsement or testimonial from any of the persons in the photograph.

All third-party trademarks, including logos and icons, referenced in this website and our content, are the property of their respective owners. Unless otherwise indicated, the use of third-party trademarks herein does not imply or indicate any relationship, sponsorship, or endorsement between 401(k) Maneuver and the owners of those trademarks. Any reference inside this website or content to third-party trademarks is to identify the corresponding third-party goods and/or services.

Would love your thoughts, please comment.x

Select a Date from the Calendar below


Select a Date from the Calendar below


Have questions? Need help?

Book Your Complimentary

15-Minute 401(k) Strategy Session


Looking for tips that might maximize your retirement
savings and help you be a better steward of your money?

Subscribe to our 401(k) Blog

The go-to-source for your retirement investing and saving tips

5 401(k) Accounts Mistakes that May Negatively Affect Retirement Income

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.

Why Account Balancing & Allocation May Affect 401(k) Performance

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.

The 5 Top Costly 401(k) Rollover Pitfalls

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.

Make the Best Decision for Retirement:
Understanding the Different Types of
Financial Advisor Licenses

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.

How Popular Advice On Target Date Funds May Be
Working To Undermine Your 401(k) Retirement Savings

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.

3 Things That May Supercharge Your Future
401K Performance...Even In a Down Economy

Download Your Copy Today

*Your privacy is important to us. We do not rent, sell or share your information.