My husband and I used to go hog wild during the holidays. If I saw something I thought he’d like, I bought it. If he saw something he thought I’d like, he bought it. It wasn’t a very money-sound situation. Last year, we decided to set a limit—we were each allowed to spend up to (but not more than) a small amount on the other one, and we’d spend the rest of our family gift budget on something we could both enjoy, like a home theater system or a weekend away.
It worked so well last year that we’re doing it again this year. Of course there are things that I’d love to buy for my husband that cost more than our limit. But does he need them? Probably not. And we both enjoy going in on a family gift and enjoying it together. Plus, we spend less in the end because we’re pooling our money instead of spending at will.
Nearly three-quarters of those who develop a holiday shopping budget stick to it, according to a recent survey by USAA. That suggests to me that the first step is paying attention to what you’re spending—setting limits, making lists of gifts you plan to give people and how much they’ll cost, etc. In my case, I’d never really thought about how all the little stocking stuffers add up, but once I tried to fit them into my budget, I saw that I was spending more money than I wanted to on gift fluff.
How will you handle holiday spending this year? Are you setting limits on gifts for each person? Limits on your budget overall?