3 Tips for Beating Holiday Financial Pressure

One of the biggest causes of holiday stress is financial pressure – the feeling that you have to spend more than you can afford to provide Christmas gifts for family and friends. As a father of five children ages 12-22, I can attest to the fact that parents often feel pressure to spend more than they can afford on Christmas. Here are three ways:

If you haven’t read it yet, here’s my first post on how to beat holiday stress: “5 Tips for Beating Holiday Stress and Busyness”.

Causes of Financial Pressure & Holiday Stress

1. We want to give the kids a “good Christmas”

All of us have memories of what Christmas was like for us, and an expectation of what Christmas ought to be like for our kids.

If we didn’t receive much in the way of Christmas gifts when were were kids, we might feel led to go a little overboard in giving our own kids more.

Sometimes, sadly, kids try to manipulate parents into buying certain kinds of gifts in order to please them.  I’ve met many a family who allowed that to happen, and it severely stretched – and even broke – their budgets.

2. We want to look good in the eyes of others

If we’ll be exchanging gifts with others, like family members, friends, and co-workers, we may feel an expectation to give a certain kind of gift, spend a certain amount, or hopefully give a gift that is at least as good as, and hopefully better than, what we think others will give. Yeah, because we’re good at comparing ourselves to others.

3. We want to be the host with the most

If we play host to holiday parties or family get-togethers, it is easy to overboard on decorations, food, and drink. Again, this is often due to what we think others will expect.

3 Tips for Beating Holiday Financial Pressure

These common causes of Christmas financial pressure can quickly elevate our level of stress if we’re not careful  – not to mention large credit card balances. Which means the stress we feel during the holiday season can live on well into the new year.

Here are three ways you can overcome holiday financial stress:

1. Set a reasonable Christmas budget

Base your Christmas budget on your financial reality, not on what you think others expect from you. Some experts even suggest you set your Christmas budget on December 26.  Yes, the day after Christmas 2018 is when you should start planning for Christmas 2019.

2. Set aside the money in advance

Once you’ve decided how much to spend next year, create a plan for how you’re going to save the money.  For example, if you want to budget $500 for Christmas, divide it out by 12 months and you’ll need to save just over $40 a month.

Some banks still offer Christmas accounts which will automatically pull the money from your savings or checking account into the special Christmas account each month.  Of course, you can also open a special online banking account for that too.

3. Help others manage their expectations

You can avoid, or limit, a lot of stress by simply helping people manage their expectations.  If your kids have enjoyed $100 worth of Christmas gifts in the past but you need to cut back on Christmas this year and only spend $50 per child, let them know what’s going on and why, so they don’t start begging and dreaming about higher dollar items that clearly are outside your budget range.

Holiday stress is real, and affects millions of Americans each year.  But it doesn’t have to ruin your Christmas if you take proactive steps to manage, or even eliminate, the financial pressures and expectations that often cause the stress.

What is your biggest source of holiday financial stress?

Be sure to read my third and final post on How to Beat Holiday Stress by Managing Expectations.

This article was originally published on December 2, 2012, and updated on December 8, 2018

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