How Much to Spend on Christmas Part 3 – the HOW

How much to spend on Christmas! GREAT ideas!

You guys still hanging in there? Part 3 of my How Much to Spend on Christmas post series is finally here! Let's recap:

Part I covered the “WHAT” behind buying your kids presents for Christmas – how to avoid going into the “unnecessary” zone and overpaying when you just don't need to. Part II covered the “WHY”, and helped us figure out why do should/shouldn't buy things a certain way for our kids (trust me, it's worth a thorough read).

And now, the moment you've all been waiting for…Part III which will show you the “HOW MUCH” you should be spending and how to do it in an organized way! Please note, you really truly should read parts 1 and 2 before reading this one or else it will be confusing and harder to do…mmmmkay? Without further adieu…

How much to spend on Christmas: Part III

How much to spend on Christmas! GREAT ideas!

The third important question you need to ask yourself when buying gifts for your kids is:

3. How much should I spend?

This is the golden question, isn't it? Unfortunately there's not a magic calculation that works for every family. Age of kids, family income, time of life, traditions, it all factors in. That being said, it's absolutely imperative that you set a calculation for your own family and abide by it!

A few years ago I started budgeting by price. That worked ok, but last year we tried something new that I think we are going to stick to from now on!

Instead of budgeting by price, our kids now get 1 gift from us, an 1 from Santa.

I know it doesn't sound like a lot, but when you add grandparent gifts, neighbor and friend gifts, aunts, uncles, cousins, even babysitter gifts…our tree is EXPLODING with presents!

How much to spend on Christmas! GREAT ideas!

(I couldn't help posting this old picture of when Daivy (now 2) was a newborn. Be still my heart!

We found that when we budgeted by DOLLARS we were more focused on the price of each item, than on what they really needed. Plus, we were overspending on some kids, and underspending on others. By focusing on just ONE gift from us and ONE from Santa, we narrow it down and buy the best gifts for them, and really focus on those.

In our house those two gifts still fall within the budget listed below in our family, but it does level out better because my oldest tends to get more expensive gifts than my 2 year old, so it averages out nicely.

For example: This year for Daivy (2 years old) we got her a cute singing picnic basket toy from Target for only $12.99 (plus 20% off using the Cartwheel app), and a princess baby doll something or other (still shopping around) that will be between $15-$20 most likely. That means we are only spending $31 or less. Our budget for her is $50 (see below), so that extra $19 we will put toward Beck's gifts.

For Beck (almost 4) we got him a new bike (his got hit by Bubba's motorcycle) that cost $69. We have a karaoke stand that I got for free using Zulily dollars, so even though it was $19 over budget, it still works out fine in the end.

Random (important) request:

Last year on Facebook a post from a single mother went viral. She was pleading with the world to stop allowing Santa to give the most extravagant, expensive gift for Christmas. She said something to the effect of “How do I explain to my little boy why Santa gives some kids Xboxes, and he get socks? Please mothers, let Santa gift a modest, practical gift, and take credit for the extravagant gift; have it be from mom and dad.”

That really struck me. So now, we give the bigger gift, and Santa brings the smaller or more practical one. A little Freebs food for thought for ya.

Moving on!

My budget recommendations:

The first step is to decide how much you can afford for Christmas (not just gifts), then work backwards, as shown in Part 1. Let your finances decide your kids' gifts, not the other way around! I recommend setting a budget for your entire family, then dividing out from there, and I recommend doing so by age.

Here are the budgets I recommend:


  • Kids 0-4yrs – $50
  • Kids 5-10 – $75-$100
  • Kids 10-15 -$100-$150
  • Kids 16-18+ – $150-$250

Stocking budget recommendations HERE

Family members/friends:

  • Grandparents – $35-$50 each
  • Parents – $50 each
  • Extended family adults – $25-$30
  • Extended family kids – $15-$25
  • Friends – $5-$10 family gift (+ a homemade treat. This year I'm giving my girlfriends gorgeous rolls of wrapping paper that I got at a trade show for $1 each! Definitely worth more than $1 and is a great, practical gift.)
  • Neighbor gifts – $1-$2 each (see all my neighbor gift ideas! We give gifts to 100+ neighbors so we keep it frugal. If you give to only a few, you could up that number of course. There are 2 families that live by us that really have been a special blessing to our family and have provided us aid and assistance too may time to count, especially needed as we don't have family near us. Thus, as an extra special thank you we are taking the couples on a date to a musical as a thank you. It's a big splurge for us but we felt it completely justified. So just know that you will need to tailor it to your budget and situation!)

A few things to keep in mind…

  • Remember, these are general…but reasonable. Your 9 month old won't need $50 in gifts. In fact, please don't buy them anything! Give them a wrapping paper tube and they'll love you for life. Likewise, your 18 year old might need a little more than $150 if you're buying them something they need for high school or college. But again, don't tread into the “unnecessary” zone. If you are spending more than $50 on a 3 or 4 year old, you are overspending. Enough said! You can find incredible bikes, toys, scooters, games, and even electronics on clearance, online, and in the classifieds. That one's easy. The older kids? $75-$150 is reasonable, doable, and very common! (Keep reading for ideas.)
  • Borrowing from budgets is ok. Like I described above, if your 2 year old only needs one toy that's $14, you could use the rest of her budget for your older kids if needed.
  • Let them choose! As explained in detail in Part I, let them choose if they want one big gift, lots of smaller gifts, or want the cash to put toward a gift outside that budget. There is absolutely no harm in that. Or, you could do what we are doing and have them tell you their top TWO gifts and just go with those!
  • Yes, that includes clothes and “need to have” items. I, personally, am not a believer in buying your kids clothes for Christmas unless that's specifically what they want on their Christmas gift. I use Christmas and birthdays for the two times per year where I can actually give my kids fun-only items. I buy their clothes throughout the year as I see them come on sale, using my weekly “other” budget. I always have more than I need because I buy one year ahead as seasonal items go on clearance. Let your kids buy their own school clothes, and if they didn't buy enough of something they need, have then earn allowance throughout the year and have them whatever they want…with their own money! There is no harm in that. Don't let the items YOU want your kid to have eat into your (already tight) Christmas budget.
  • Gifts from you are NOT the only ones they will be getting. Grandparents. Cousins. Friends. Gift exchange at school. Aunts and uncles. We don't even live near our family, and each year my kids get more gifts from others than we know what to do with. Don't believe me? Check out last year when Mimi and Grandpa were in town for Christmas:

christmas day

It was like the North Pole threw up in my living room. And Beck wasn't even born yet, so that was for only two kids! They got so many gifts that my kids were actually overwhelmed. So here's what we did…

  • Rotate the extras out. I took 2/3 of the gifts, hid them in the closet under my stairs, and there they remained all year. I've given them back to the kids for their birthdays, they earned a few on their behavior chart, and they will get more for Christmas this year…but we will STILL have leftovers. Don't tell, but I even re-gifted a few (not the ones from immediate family, though) to other kids' birthdays throughout the year. Our kids just don't need so much! And trust me, I'm not depriving them in any way. My kids have more toys than anyone I know personally, and that's saying a lot.
  • Remember VALUE and PRICE are different. When you look at $75 you might think, “but that won't even cover the one bladiblah my kid wants, let alone 3 or 4 presents!” Yeah, probably not…when you pay full-price! Remember, if a gift your child wants costs $50, don't pay $50 for it! Keep your eye on it throughout the year. Online, in stores, Zulily, daily deal sites, Amazon (if you add it to your cart it will notify you when the price changes), Black Friday, Hukkster. Buy the gift AFTER Christmas when it's on sale, and it give it to them for their birthday! (January and June are the best two months to buy things as explained HERE.) Trust me, it WILL go down in price, I PROMISE!
  • Get creative. If your child wants something uber expensive that doesn't ever go on sale (like an American Girl doll or iPad mini…but please don't buy your kid an iPad mini, just for the record…) then buy it refurbished. Find a used one. Trade for one. Is your husband a dentist? Plummer? Piano tuner? Are you good at sewing or cleaning houses? Post on the classifieds that you're willing to trade and see what happens! Just. get. creative. Yes, it might mean work work for you. If you don't want to do the work, then don't buy your kids expensive gifts. Easy fix 🙂

How much to spend on Christmas! GREAT ideas!

  • Don't forget the stockings! See THIS POST for stocking recommendations. In all, I don't believe stockings should be for gifts! They should be for simple things like treats, toothbrushes, travel toiletries, a magazine, chapstick, etc.
  • Don't do it all on your own. That will just stress you out, honey. Read blogs! Check Pinterest! The work is basically done for you. Don't reinvent the wheel, take advantage of what's out there.
  • The main rule here is to push yourself. If you can afford more, I totally understand the challenge (read what I have to say about that excuse in Part 1). As a rule, just make the budget tight! Challenge yourself! Force yourself to take time to carefully think through, plan ahead, and strategize for their gifts…rather than just waltz into the nearest toy or electronics store and walk out 30 minutes later with Christmas over and done with. Your Christmas, and kids, will be better for it.
  • Make your own tradition out of it. I did a lot of market research before writing this post, and even posted the question on my Facebook wall. I got so many great ideas from readers about how they make their tight Christmas budget special! Hear what readers just like yourself have to say about their Christmas budgets for their kids:


Hannah K: We do 3 gifts, because the Wise men brought baby Jesus…3 gifts!

 Callie O: We do 3 gifts as well we spent under $100 on all 3 kids.
 Kami L: We decided to do the “something to wear, something to read, something you need, and something you want” plus one gift from Santa. None of the presents so far are extravagant so we haven't set an exact budget. I like that there are 5 presents for each kid. Easier to keep track of and keeps the materialistic side of Christmas down.
Mary L:  For many years my Christmas budget has been $500…for everything food, wrapping paper, stamps for Christmas cards, gifts, etc. Now that my children are having children what was once gifts for them are now gifts for the grandchildren….but the budget is still $500.
Cheryl VW: We have a budget set so the amount of gifts depends on how expensive the items are that they want.
Kim A: I way way way over do it usually so this year we decided on doing 4 gifts.. (santa, parents, sibling and something they want) My kids are 2 and 4 and we figured we need to start to simplify now so that later when they are older and gifts are a lot more expensive they don't expect a million gifts. its been really wonderful to put alot more thought into each gift instead of buying the entire toy store.
Amber V: Three gifts, like Christ received. Something they want(gold), something they need(frankincense), and something made by the other members of the family(myrrh).
Kelsey Jo R: I do the 4 present thing as well!! I figure out which to get for each category and then find a way to get it cheaper! I think I spent $100 this year.
Ganine M: We do number of presents and try to keep it under the $30 range (my kids are getting older so that is changing) They get a nice present from Santa, toiletry items in the stockings, and a fancy treat from the parents. That is it. I have 3 kids and they get something from their Aunt and Grandpa too. They don't need a ton of stuff.
Debbie W: Our kids get soooo much from their grandparents throughout the year (and at Christmas) that we don't spend much at Christmas (literally…like under $30 this year on both of them). But what we desire to do is spend more for birthdays and less on Christmas on our kids…and give more at Christmas to those in need and family who don't know Jesus. But in a nutshell, we'll probably never budget more than $50/kid for Christmas.
Christi P: I gave myself a budget of $100/child. That has to stuff their stocking, put a present under the tree from Santa and a present from Mom and Dad. They buy presents for each other with their own money, too.
Nalea B: We do what Hannah K does makes it so much easier and get the 3 main presents they want. We do a gift from Santa, mom and dad but it ends up being a gift from Santa and then two from mom and dad. For the main stocking I do fruit, toiletries, new socks and underwear with a little bit of candy. I still have little kids my oldest is 4 so we scored this week at Walgreen there toys are on sale buy 2 get one free, then this week only the $9.99 toys with a $4 in store coupon. They had great toys.
How much to spend on Christmas! GREAT ideas!
As you can see, these number guidelines are not only somewhat common, but they are even generous compared to what many families are pulling off. See, I'm not that mean 🙂
All-in-all, this Christmas please keep the bigger picture in mind. Challenge yourself to hold back, and I promise you it will be just as great of a Christmas as any other…if not greater.
A Merry Christmas to all!
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. AvatarJulie says

    Jordan, thank you so much for all your posts on Christmas this year. You have completely changed my perspective, and I’m feeling so much more of the “spirit” of Christmas that I feel like I’ve been searching for over the past several years. It’s so easy to lose touch with what really matters, and in a way I think the financial struggles my family has been facing this year, have really been a blessing in this regard. You are such an inspiring and amazing woman, and I almost never leave comments on anything like this, but I really wanted to thank you.

  2. AvatarAline says

    My budget this year was actually $40 per person, for parents and santa gifts, plus $5 for stockings. I was below budget for everyone (including adults) except my 3yo who got a $50 lego. Starting shopping reasonably early and using black friday/cyber monday is how I do it 🙂

  3. AvatarAimee says

    I am always on a tight budget, so by the time I cover my kids, I don’t have a lot to spend on my sister, her kids, friends, etc. I give them small, sometimes handmade gifts and then I feel so lame!! Especially if they give me a nice expensive gift and I give them hand warmers:/ What do you suggest for this often awkward situation?

    • AvatarFunCheapOrFree says

      We take them to the dollar store and have them pick out gifts for each other – forgot to include that! I’ll add it now!

  4. AvatarCindy says

    I shop throughout the year for sales, and try to keep a running list of what I have for each person on my phone. I have a sweet neighbor that gives us toys when her kids are done, and I keep those for Christmas (I’ve been storing a rapunzel tower in the garage for two years for this christmas) Then we just fill in the gaps where necessary. It has been easy with little kids who are excited no matter what they get. We had to spend more for my oldest, but the gifts are things he needs (but is still very excited about). I love it, because come December, I am not stressed about Christmas gifts. I also buy gifts in each child’s age bracket during the year, and have a gift box my kids choose from for birthday gifts for others. This has worked out really well for us.

  5. AvatarALS says

    Hi, there! I just found your website and I am in LOVE! Your gift-giving recs are solid! I wanted to share what we do…our children are allowed to assemble a list of a maximum 10 things, that we then distribute to grandparents and whomever drew their name between the cousins gift exchange. They are allowed to choose 1 item near their max budget (we give them a dollar amount) and everything else should be less than $25. Every member of our family receives 1 gift from each member of the family, so the kids each receive 4 gifts (1 from each sibling & 1 from mom/dad) + 1 from Santa. Mom & Dad follow the rule too, but we receive 2 gifts – 1 from the kids & 1 from each other (and we don’t do extravagant)…Santa also leaves us something small in the stocking. We’ve done this ever since the 2nd child was born to help control costs and it works out because they know exactly what they’re in store for…our budget changes every year, but I try very hard to keep it under $1,000 total (inclusive of immediate & extended family, work, teachers, neighbors, white elephant, cards, etc.).

  6. AvatarAmber says

    AHH! I wished I read this 2 months ago! This would made everything so simple, easy, stress free and teach the little one to be less greedy on gifts.

  7. AvatarDan Chabert says

    There’s a simple answer to this question “How much should I spend?”. This is how I answer this every year. Only what I can afford. I always check my budget before doing any Christmas shopping. So the amount will really vary every year. It’s a fun way of shopping. Because it never becomes routine.

  8. AvatarRanelle Houser says

    Jordan, I have read this post multiple times, especially last fall and leading into Christmas. I have been budgeting for a long time but your approach has been so liberating to me and I have been readjusting everything since I discovered you last year. I am a details girl and I get hung up on how much to spend for certain things. This series was so very helpful. Thanks a bunch (by the way, though I live in Texas, I grew up in Oregon too!! Lol, love my home state!)

  9. AvatarChristine says

    Your link to 75 gift ideas for under $20 doesn’t go anywhere. I really wanted to see it! 🙂 Thanks for all you do!!!

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