How Much to Spend on Christmas: Part 1 – the WHAT?

How much to spend on Christmas! GREAT ideas!

This time of year I regularly get questions such as, “what should I spend on Christmas?” “How much should I budget for Christmas gifts?” and the kicker, “How much should I spend on my kids for Christmas?“. Truth: those are dang hard questions to answer. BUT…I take pride in being the resident “I'll talk about things people really don't want to talk about” mama, so here I am to do my best!

A few years ago I did a big 3-part post series talking about how much I recommend spending/budgeting for Christmas. I thought it was time to freshen it up and repost, to help give us all some guidelines for “safe spending” this year! While I focus mostly on gifts for our Children (since that tends to be our greatest Christmas expense), these concepts really can apply to any of us, in any situation.

I'm sure we can all agree that the true meaning of Christmas doesn't involve gifts. Amen to that. BUT…I'm sure we can also agree that gifts are part of what makes Christmas so magical! I mean, we are human, aren't we? Here are a few ideas that will hopefully help us from going overboard this year, especially for those whom we love to spoil the most…our kids.

I mean, come on, how can we NOT spoil these cute sonofaguns??

How much to spend on Christmas! GREAT ideas!

After writing this post I decided to break it into 3 parts so it doesn't give you a headache trying to read it all in one sitting! So be sure to check out Part II which is about helping us figure out why we shop the way we do, and Part III (coming Sunday or Monday) with actual numbers and budget guidelines.

Now, onto part 1!

How much to spend on your kids for Christmas: Part I

Before you even ask your kids to make a Christmas list, you fist need to:

  • Decide how much you can afford for Christmas.

    Put a number to it. Look at your income, savings, and financial situation. Look at how much you have leftover at the end of the month. You will probably need to be setting aside for several months prior to Christmas, just FYI. We keep that money in our “family regular savings”. If you can afford $1000 this year, then decide if that's what you want to spend $1000 on. If it's $300, there you go. Many of us spend without keeping track. But when you stop and add it up,  you might say “$2500 for Christmas? Heck, we could redo our kitchen floor for that! Honey, we're cuttin' back this year!”. Decide this first, then you work backwards from there and everything will be much, much, much easier.

  • Set budgets.

    Divide it up if you need to. Gift budget (this should include neighbor gifts, teacher gifts, stocking stuffers, gifts for your kids…), travel budget (even if it's to Grandma's house for a weekend, add it up!), family activities (concerts, skiing, riding the Polar Express, etc.), and miscellaneous (Christmas cards, decorations, etc). Just because it's Christmas doesn't mean you should disregard price tags on things other than gifts. Tracking your budget(s) is the most important this time of year above any other time. (and see “how to budget for Christmas” for tons of detail on this.)

(Read part 3 for kid gift budgets guidelines and suggestions.)

Once that preliminary work is done, now it's time to shop for the kiddos! Before I give you numbers and parameters for what a reasonable amount is to spend (that will be part III, stay tuned!) I need to “teach you to fish” a bit first. This Christmas I would love you to ask yourself 3 important questions to help you decide how much you should buy for your kids:

Question #1. Do they need it?

When I say need, I mean not giving them more than is reasonable or necessary.

“But my kid isn't asking for socks for Christmas, so nothing on their list is a ‘need' item.”

Smart kid! Trust me, there's nothing wrong with toys, electronics, expensive perfume or other indulgent items. Please please do not only buy your kid underwear and toothbrushes for Christmas. That would be, like totally lame, mom. The mindset I want to change here is…our kids don't need everything they want, and they certainly don't need the nicest, finest things in life. They are kids, for goodness sake! Certainly try to get them what's on their list. Maybe they need T-shirts, but do they need designer brands? No. Maybe they need entertainment. But do they need an iPad mini? Heck no. Maybe they need new shoes, but do they need top-of-the-line hot-off-the-press designer shoes? No. Maybe it's time for a cell phone. But do they need an iPhone? No! Maybe they want a $130 American Girl doll. But do they need it to be American Girl? No! There are knock-off brands that are beautiful and fun that will entertain them all the same. Our kids don't need the things we cater to 99% of the time.

“But the only gift they want costs more than their budget allows.”

Easy. Let them choose. First off, have your kids prioritize their Christmas list. My parents would always ask us to number the gifts by priority. They would have us decide if they'd rather have one big gift, or multiple little gifts. They made it very clear that we had a Christmas budget. They never told us what it was, but my mom would say “Honey, your gift is outside of your Christmas budget this year. Would you like me to surprise you with other things on your list, or do you want the money so you can have almost enough to buy it yourself?” (or “Santa's Budget” if they are of age).

Or, figure out how to make it fit within the budget! Buy off-season. Buy at a discount (daily deal sites like Groupon have amazing deals on items). Simplify (buy a single car for your child that they will absolutely love, rather than an extravagant set). Buy used. One year I needed/wanted a bunch of clothes for Christmas. My mom spent my budget at a thrift store and I got – literally – mounds of clothes! I was well aware they were used, and to this day, it was one of my most memorable Christmases ever. I was giddy with joy! I was wearing new outfits for weeks. For a tween girl, that was heaven on earth. And guess what? My parents made great money and could afford 100x that! But they were smart and it taught us the value of appreciating items' value and not just the price-tag.

“But I can afford it”.

This is the HARDEST one. Trust me, life was much easier when we had no money. Now that we make a steady paycheck, saying no is so hard! But just because we can afford it, doesn't mean we need to. For one, it's not doing our kids any favors. Giving your child everything they want is only setting them up for a hard life. It's setting unrealistic expectations for their future that are incredibly hard to undo. Can you imagine how hard it will be for them to get a job if they don't know how to work for what they need in life? Can you imagine how hard their first…oh…50 years of marriage will be when they're used to getting everything they want? Please don't do that to your child, it's really not fair to them.


For two, you work hard for those dollars so that you can afford it! Don't waste them on an unnecessarily high-end item that your kid won't even like 6 months down the road! Take those extra dollars and pay down debt. Put it toward a family vacation. Build up your savings. Fix up the part of your house you've been putting off for 12 years. Put it away for your kids' college educations. Save those dollars for something greater.

Again, feel free to give them what they want within your budget, but don't go into ‘unnecessary” territory.

“But it's Christmas.”

I won't deny that Christmas is the one time per year that we should buy our loved ones special things that they want, and wouldn't buy for themselves. But don't lose sight of the bigger picture in your life because of a holiday. Keep focused. Set goals as a family and work toward greater things. If you aren't careful,  a single Christmas can set your family back by several years. No, not exaggerating, and no, I'm not talking about a lavish Christmas either.

Happy Christmas Santa

By all means, enjoy Christmas! Make it the best one ever! But don't use your dollars as a cop-out for making that happen. Put some thought, heart, and creativity into it and you won't need to spend a dime to create the greatest memories of your, and your child's, life.

“But they'll be so sad to not have it.”

Maybe. I'm sure there were many Christmases in my life where I didn't get everything I wanted on my list. And guess what? I can't remember them. So it's safe to say I'm not scarred for life, and it hasn't caused any permanent damage. More importantly, use it as a learning experience! If they are disappointed, “I'm sorry Santa didn't bring you that present Honey. But guess what? I need help cleaning out the garage this week and I bet you could earn enough money to go buy it yourself!” Just because they don't get it for Christmas doesn't mean they can't have it at all. Teach them how to work for it and save up for it! This lesson will give them a gift far greater than the item they are buying.

How much to spend on Christmas! GREAT ideas!


Again, be sure to check out Part II (helping us figure out why we shop the way we do) and Part III (with actual numbers and budget guidelines) coming soon! You'll be happy you did 🙂

Don't forget about my Secret Sauce online budgeting program, Budget Boot Camp! Super fun video program that makes money easy to understand. All you need is a screen and you're set!

And don't forget, if you don't save at LEAST what you paid for the program, I'll refund every dime. You've got nothing to lose! Use the code FCFBLOG to get an extra 10% off, because I love you 😉





  1. AvatarAimee says

    Growing up, even when we believed in Santa, my parents still told us “you have $75 this year” or whatever and then we looked through the toy catalog & new what was realistic. We always had a great Christmas and I never remember being disappointed ever. I think we put too much pressure on ourselves to get as much as we think other people are getting their kids or heaven forbid they don’t get everything on their wishlist. I totally agree with what you’ve written so far & am looking forward to the next parts:)

  2. AvatarAmber Tully says

    So pumped I came across this!!! And YOU!!! I love Pinterest as much as you 😉 You just saved my sanity and my heart with this article as I was wondering HOW in the world we would pull christmas off with only 4 weeks of paychecks left and this year not being able to put money away. Cannot thank you enough!

  3. AvatarRuth Parytka says

    Like the others who’ve commented here, the pressure is internal to pull together a satisfactory Christmas. I think that it’s because no one is sure what to do about gift giving and there is a shroud of mystery about how well the gift will be received! As a first time Mom, there are certain people I want to gift well that are now part of my life – like my child’s daycare providers. They’ll get $245 amongst 4 people, with $100 going to the owner of the daycare. I am following my heart on this one which makes it alright, but I do wonder about averages, standards, expectations and social norms.

    So yeah, I’m freaking out about this holiday year, but it’s good to read blogs like this so I can remind myself that it’s all going to be OK. Aside from daycare gifts, I’ve all but stopped gift giving and offered my time as THE gift instead.

  4. AvatarJenny M says

    The part II isn’t working for me, it just goes to Oart 1. I’m eager to see your part 3 also once it’s published.

Leave a Reply

Your email address will not be published. Required fields are marked *