A survey done last year by a New Zealand newspaper showed that while giving gifts for Christmas is a worldwide activity, people in different countries tend to give differently. For instance, although the survey indicated that New Zealanders were more likely to give gifts than Americans, the average American spent far more on Christmas gifts -- more than double the amount spent by New Zealanders. Americans spend an average of about $1,000 on gifts each year.
The spending, however, isn't limited to gifts. Consider the other expenses you typically incur during the holiday season. Many people travel to visit family members at both Thanksgiving and Christmas. As your neighbors start putting up elaborate displays in their yards, you may feel compelled to buy at least a few sets of lights and decorations. Buying food and beverages for family gatherings, office parties, and other seasonal celebrations can add up in a hurry. Throw in the sometimes irresistible urge to pick up a little something for yourself during your shopping trips, and it's easy to see how your spending levels can go beyond your best intentions.
In the rush of the holiday season, it's easy to forget about how much you're spending. Putting your expenses on your MasterCard (NYSE:MA) or Visa is a convenient way to shop, but if you're not careful, you won't realize the true extent of your expenses until you get your January credit card statement. If you're worried about getting yourself into financial difficulties over the holidays, here are some ideas that may help you keep things under control.
1. Plan early
When it comes to dealing with your holiday obligations, it's easy to procrastinate. Yet the most successful gift-givers always seem to have a system in place. For some, looking for potential holiday gifts is a year-round pursuit. This has the twin benefits of spreading out gift costs throughout the entire year and of having most, if not all, of the gifts ready by the time December rolls around. Even if you can't bring yourself to shop all year long, you can start putting money aside so that when the holiday shopping season begins, you already have a large fraction of your gift budget saved in cold, hard cash.
Planning also includes figuring out when you're going to buy your gifts. For shoppers who are willing to brave the crowds, the annual Thanksgiving sales thrown by nearly the entire universe of retailers -- including traditional department stores like JC Penney (NYSE:JCP), electronics specialty stores like Best Buy (NYSE:BBY), clothing stores like Gap (NYSE:GPS), and bookstores like Barnes & Noble (NYSE:BKS) -- can sometimes represent the best opportunity to cash in on unique bargains. On the other hand, some shoppers respond to busy stores by throwing their budgets to the wind and grabbing the first thing they see to get them out of the store as quickly as possible. For them, shopping during unpopular times like Monday and Tuesday nights or using online gift sources like Amazon.com (NASDAQ:AMZN) or eBay (NASDAQ:EBAY) can help keep emotions from overwhelming financial considerations.
2. Be creative
Let's face it: Some people have high hopes for their gifts. If you have a family with expensive tastes, one way to help everyone get what they want is to set up a system in which each family member buys just one major gift for one other person. Since this means each person can focus their resources on that one gift, high-ticket items can suddenly come within reach, even for those of modest means. While this means there will be fewer presents to open, the gifts that are there will be appreciated even more. And if you find yourself with some money left over, there's nothing stopping you from buying small gifts for others if you want.
On the other hand, for some gift recipients, it really is the thought that counts. Cheap gag gifts can bring howling laughter into your home when it's time to open the presents. Also, making hand-crafted gifts can be a great way to get your kids involved, and for parents and grandparents who already have every material object they need, a homemade present can be more meaningful than any other gift you might struggle to find. Just keep in mind the tastes of those to whom you intend to give these gifts to make sure that they will be appreciated.
3. Use cash
Budgeting is difficult for some people. If you're one of them, buying things with credit cards can be dangerous, as you then have to remember what you've already spent when considering additional gifts and other expenses. On the other hand, if you allot yourself a certain amount of cash, you'll always know exactly how much you have left, and so you will always have to consider whether buying one particular gift will leave you enough to finish your holiday shopping.
4. Remember those in need
For many, the Christmas spirit is about more than just showing appreciation for family and friends. The holiday season can be a great opportunity to donate both time and money to worthy causes in your community. By doing things like donating toys to poor families, collecting food items for local food pantries to distribute to the hungry, volunteering to work at a soup kitchen or shelter, or helping a local charity with a year-end fund drive, you can make sure that everyone shares a little happiness during the holidays.
It's easy to respond to the pressure of making the holidays memorable for your family by feeling cynical about buying gifts and spending money. By first doing what you need to do to take care of the financial aspects of paying for the holiday season, you can leave yourself free to enjoy the things that bring you, your family, and your friends joy and happiness.
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MasterCard and Gap are Motley Fool Inside Value selections. Best Buy, Amazon, and Gap are Stock Advisor picks.
Try as he might, Fool contributor Dan Caplinger is a perennial Dec. 24 shopper. He doesn't own shares of any of the companies mentioned in this article. The Fool's disclosure policy is always the perfect gift.
