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Battling Holiday Debt

According to CNBC, 36% of Americans took on Holiday Debt in 2021 borrowing an average total of $1249 (source). While many Americans plan to pay off the debt over a span of three to five months (source). Over the years we have found creative ways to give intentional, meaningful gifts that don’t break the budget.  […]



According to CNBC, 36% of Americans took on Holiday Debt in 2021 borrowing an average total of $1249 (source). While many Americans plan to pay off the debt over a span of three to five months (source).

Over the years we have found creative ways to give intentional, meaningful gifts that don’t break the budget. 

Whether you have a little or a lot to spend, I believe the key to joyful gift giving is going in with a plan and a spending allowance (aka budget) for giving! Creating this Holiday Spending plan in advance keeps us from feeling overwhelmed or stressed, and challenges us in a good way to get creative! 

I thought it would be helpful to share exactly how we prepare our finances for the extra expense of the Holidays without losing the joy and excitement of giving! 


7 Steps to create a stress-free and budget-friendly Holiday Spending Plan.

Total time commitment : 2 hours.

1. List everyone you need to buy for.

I know this sounds silly, but the first step I do each year is create a full list of everyone we want to give gifts to this season. The list includes family members, neighbors, friends, professionals (like our wonderful house cleaner, or mail carrier, etc), Christmas gift exchanges, party hosts, etc. It’s those extra people on the list who tend to be forgotten or last minute that stretch the budget ;).

Helpful Tip: We create a separate list for business gifts including vendors, clients, etc. While these are business expenses and not personal, it’s still important to go in with a spending plan!

2. Decide your budget in advance

Each year when I update our family budget for the year, we create a “Christmas and gifts” allowance for the entire year. Once we get to November and start planning for the Holidays, I review how much we have left in our gifts budget as well as our current savings to determine our Holiday gift budget for the year. I want to know our entire budget before moving on to step #3. 

Helpful hint: Don’t forget to budget for extras : things like Holiday cards, Holiday decor, and buying for yourself (you know you do it!)! Also, if you’re hosting for the Holidays budget for extra food costs! 

Related : Interested in learning how we plan our household budget for the year? Check out my complete personal budgeting program, Blueprint at Home

3. Determine a spending allowance for each person / item on your list.

Once you know your overall budget (step #2), we go through our master gift list and give a spending allowance for each person. This step takes some time and tweaking to get right, but it feels so good to know how much we have for each person.

Our budget tends to shake out like this (from highest amount to lowest):

  • Spouse (typically most expensive)
  • Kids (close second!)
  • From there immediate family like parents and siblings
  • Cousins
  • Grandparents 
  • Outside of family

You get the idea!

4. Extend the Budget in creative ways!

Years ago we started exchanging names between our siblings. This way we can spend more on one person rather than buying multiple small gifts. I have a friend who’s parents started the tradition of buy, gift, or make: Buy something new, Gift something you already own that the other person wants, or Make a gift. It’s creative and fun and has now become a beloved tradition in their family. I love this idea! Gifts don’t have to be something purchased or new, get creative! 

Here’s what we do: We exchange names between siblings. We typically make something for grandparents. We give baked goods to neighbors and professionals. 

5. Plan gifts in advance

Again, I know this sounds simple and can also feel undoable when life is full and busy with all the things but planning gifts in advance is so helpful. 

We gather Amazon wish lists for cousins and I love shopping gift guides as well for fun, fresh ideas! Chris loves Julia, Studio McGee, Magnolia are three of my favorite resources for gift ideas! 

Related : Check out our Complete Holiday Gift Guide for 2022.

6. Buy Early!

I try to start buying early in November a few gifts a week with an attempt to be done by early December. It doesn’t always happen, but this way I am buying over time and spreading out the cost.  I find when I’m rushed, I always end up overspending.

Plus, you’ll find better deals and won’t end up paying for rushed shipping! (give yourself grace here, there will always be someone you forget or something that was forgotten).

Helpful Tip: I have found the best deals on holiday cards are during Black Friday. Go ahead and start getting your list together of names and addresses so you know how many you need and snag a great deal! 

7. Remember: Meaningful Gifts don’t have to be Expensive Gifts

In theory we all know this, but I think it’s really hard to believe it. Gift giving can come with so much pressure. Ideas like: “If you receive a gift, you must give a gift in return” or “Gifts must be of like-kind value” can make giving so stressful. I have found that some of our most treasured gifts both given and received have been the least expensive gifts. 

Think of creative ways to give meaningful gifts that don’t break the bank. Don’t underestimate the meaning of homemade gifts especially for parents and grandparents (they eat that stuff up)!

One year we made a homemade quilt for Kyle’s mom. It is probably my favorite gift we’ve ever given and I know she treasures it. It cost us about $30 to make and a LOT of sewing needle finger pricks ;). 

Last year we gifted Kyle’s mom a handprint ornament making kit I found on Amazon for under $10. It was Madelyn’s first Christmas and was so fun to make the ornaments together. The gift of time and experiences is so special. 

Check out our Gifts outside of the box Guide for more ideas! 


While staying “on budget” and out of debt this Holiday season is important financially, I believe the true value in this process allows me to enjoy gift gifting without feeling overwhelmed and stressed. So often the Holidays become hurried and rushed so I am always grateful for practices that allow me to slow it all down and soak up the most wonderful time of the year!

I hope this process helps you as you prepare for the Holidays and gift giving this year!






November 4, 2022

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