Skip to main content

'Tis The Season to Save: How to Make Smart Spending Choices For Gift Giving

various red wrapped gifts on white background

The average person spends about $1,000 a year on holiday gifts and will take until July to pay it off. We asked money coach Mikelann R. Valterra, MA, AFC®, to share her top holiday spending tips so you won’t fall victim to the holiday spending hangover come January

Tip #1: Create a spending plan.

Most people overspend during the holidays because they don’t do any planning or preparation. It may sound simple, but creating a holiday spending plan is one of the most important things you can do to stick to your budget. To start, make a list of everyone you’re going to shop for, gift ideas, and the amount you want to spend. Then, add it all up, make sure you’re comfortable with the dollar amount, and adjust as needed. A plan will help you get your shopping done faster and cut down on impulse buying.

Pro Tip: Don’t carelessly create a plan on the back of an envelope, and never look at it again. Keep your list with you, and when you buy a gift, update the list. With a plan in place, you’ll know when to stop shopping—if you don’t have a finish line, you’ll keep going.

Tip #2: Buy group gifts.

If you can, avoid giving individual gifts. If you’re shopping for a whole family, consider purchasing one all-encompassing present, like a game or an experience, instead of one for each family member. Buying for a group will save you time, money, and stress.

Pro Tip: Another way to avoid buying individual gifts is by doing a name drawing. Decide on a price limit, put everyone’s name in a hat, take turns picking, and only shop for the person you choose.

Tip #3: Have a single source of spending money.

Ideally, it’s best to use cash when buying gifts; people can spend up to 20% more when using a credit card. However, if a credit card is your only option, you should use the same card for all your holiday shopping. Multiple cards can quickly lead to overspending.

Pro Tip: If you’re putting gifts on a credit card, don’t buy more than you can pay off in two months. Also, stick to using a basic, low-interest credit card, not a store-specific one.

Tip #4: Don’t worry about finding the perfect gift.

It isn’t up to you to find the perfect gift that’ll fulfill all desires. You aren’t expected to be a mind reader; gifting should serve as an opportunity to express your fondness for the recipient. Nobody wants you to go into debt in your search for the perfect gift.

Pro Tip: Some gifts should be considered “token gifts” that are small enough that the recipient doesn’t feel the need to reciprocate. You shouldn’t give just to get!

Need some homemade gift inspiration? Check out these yummy recipes that are great for gifting

Tip #5: Communicate expectations.

Going overboard and over-gifting is a common problem this time of year. Being transparent and setting limits, both in terms of money and quantity, is crucial—especially when it comes to kids. You don’t have to feel guilty about spending too little. Help things go smoothly by communicating expectations early on.

Pro Tip: Parents: ask your kids to share the top three things they loved about the holidays from the previous year. Often, their answers will include things like making cookies or looking at lights—not gifts. Make sure to schedule these activities in your holiday plans. Doing so will take the focus off gifts and keep everyone happy.

Doing activities together is one of the best things about the holidays. If you're looking for things to do this season, check out these holiday event ideas

Tip #6: Limit your shopping time.

When you’re shopping, it’s easy to get into a trance and mindlessly spend money. If you’re shopping online, set a timer for 60 minutes. When the timer goes off, step away from your computer for a bit. If you’re at the mall, make it a priority to take a break every 90 minutes or so. Doing this will make you more thoughtful about your gifting and your spending.

Pro Tip: These breaks don’t need to be long. If you’re at home, spend a few minutes unloading the dishwasher or updating your list. If you’re out and about, take five and grab a coffee or warm tea.


Mikelann Valterra is a money coach and accredited financial counselor with over 20 years’ experience. She specializes in working with women—coaching them on how to escape the money fog, feel more in control of their finances, and love their financial life. If you are ready to leave money stress behind and design a life you love, please visit and read about this life-changing work. Once there, grab her free eBook on how to stop worrying about money