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| Education and Financial

12/16/15

List sliced: How much should you spend for the holidays?

The age old question regarding the holidays centers not so much on checking your list twice or even making it, but rather how much you're going to spend in total on everyone you're buying for this holiday season.
I've truthfully done both as far as holiday shopping goes. I've had a list a mile long, with everyone on it from the mailman to the guy I buy my newspaper from in the morning, along with family and a host of friends that I might see twice per year.
That year, I spent in the neighborhood of a thousand dollars, and the holidays simply weren't that enjoyable because I had no money leftover and struggled to find the space to fit in, you know bills.
That was about 10 years ago, when I was in my 20s and had disposable income that I thought would last forever. In my early 30s, I was in between jobs and only had a few hundred dollars to spend on the holidays and shopping. It wasn't quite the hinderance I thought it would be, and I was forced to find alternatives to Coach bags, Armani clothing and lottery tickets for everyone I've ever met.
I got creative. I made a keepsake trunk for my mom that was engraved with her kids' names on it and filled it with things we all loved growing up and letters we made for her. The entire project cost less than $50. And mom appreciated more so than any diamond earrings or bracelet I could have flagged down for her at Macys.

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The point is there really is no right or wrong answer to how much you spend as long as you have the means to do so. The trick is determining a budget that works for your overall income, and typically you can count on the number 30 being your ultimate guide. You should spend roughly 30% of your income (gross) on gifts, leaving half of your paychecks for bills and the rest to be put in your savings account (no, you can't forget about that just because its the holidays).
Using that formula typically is perfect balance between buying what everyone wants and being able to get through the holidays in one piece financially.
And remember, you're not all things to all people as far as buying goes. Your not Santa, so don't feel like you owe everyone a gift. Gift giving should be reserved for those who are close knit or perhaps impacted your life in a way that has nothing to do with being blood relatives.
In any event, being smart around the holidays should be your guide on how much you spend, so you can still save in the process.

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