The National Retail Federation (NRF) consumer spending survey conducted by BIGinsight estimates that the average holiday shopper will spend just shy of $750 this year on gifts, décor, greeting cards and more.
But, according to USA Today/University of Michigan study, “One out of five families owes more on credit cards, medical bills, student loans and other unsecured debt than they have in savings.”
Though NRF’s survey also indicates that consumers will comparative shop, search for sales and travel less (or not at all), there are other ways to scale back your holiday expenses, without losing any of the festivity or joy. Here are seven clever ways to start a new holiday vibe that involves less stuff, and more memories.
Theme your gatherings.
Instead of throwing a holiday bash that lasts all day and night, hold a themed gathering that will set expectations for your guests and limit your expenses.
Wine and dessert parties, for example, can reel in hosting costs without displacing those who look forward to your annual event.
If you hold typically hold an annual holiday open house, make it a cocktail hour with appetizers and drinks, followed by a caroling jaunt around the neighborhood.
Redirect the focus.
Plan your holiday calendar and make a commitment to attend free events in your area like holiday parades, lighting ceremonies and musical performances to cultivate the joy of the entire holiday season, versus the “main event” of shopping and presents.
Start simple family traditions you can maintain, regardless of age or income, like a family slumber party where you hang festive decorations, bake cookies and cuddle up with blankets and pillows on the floor of your den to watch holiday movies together—free of phone calls and other electronic distractions.
If holidays have gotten excessive, kids (and adults) may view the idea of paring down holiday as punishment; communicate the “why” in a way that resonates.
Approach family members about a gift budget early in the season and draw names so that each person gives to one recipient only.
“Make it” or “bake it” boundaries are another way to limit costs on large family gift exchanges. If you’ve already introduced the holiday wish list to your children, continue the tradition but explain that they should identify no more than three to five items that they really want–and that they may get one of them.
When holiday “want” sets in, explain to kids that they do have choice but it might mean taking one item off the list when that new toy they “have to have” becomes the focus.
If you’ve got teens, Suzanne Kleinberg, author of Keeping Up with the Jacksons: A Financial Management Guide for American Teens, recommends using time-value to explain a holiday budget.
For example, if you make $25 an hour after taxes, explain to your teen that the iPhone he’ll “ die without” will require you to work half of an entire week in order to earn the money to buy it.
Those new $100 yoga pants every other girl on her cheer squad has? They’ll take the equivalent of an entire school day for you to buy.
If your teen remains set on a pricey item, make him or her earn the difference of the budget you’ve set by taking on part-time work, absorbing chores you normally handle or volunteering for a set number of hours.
Fill your events with memories.
Though holiday spending can be a great financial strain, some family members may meet your desire to scale back with defensive reactions.
Sally Palaian, Ph.D., licensed psychologist and author of Spent: Break the Buying Obsession and Discover Your True Worth says the most impactful way to take the focus off of “missing” gifts is to plan activities that foster memorable human connection.
When guests arrive to your holiday gathering, for example, greet them with questionnaires about favorite holiday memories, gifts, songs and movies. After the meal, use their answers to form a trivia guessing game that will get conversation and laughter flowing, even among shy guests or distant relatives.
If your family has a wilder streak, holiday charades and dress-up themes can add an element of silliness that guest look forward to. Compile holiday videos and photos from the past to display during the event so you can reminisce together.
If time spent opening gifts is something your guests value, start a tradition of exchanging family heirlooms like simple ornaments that hold special meaning and spark interesting conversation.
Happiness studies repeatedly show that experiences, not things, are what people actually derive lasting meaning from. Andrew Mellen, author of Unstuff Your Life!, says that experience gifts needn’t be pricey or extravagant.
Gift an activity that you and the recipient would enjoy—but wouldn’t have the guts to do alone, like a cooking or salsa lesson, workout class or adventurous hike.
Tailor the gift to life.
Consider what you can give of yourself to make another person’s life easier. Deliver a few home-cooked family dinners throughout the year to a busy working mom instead of gifting a sweater she won’t remember.
Offer to babysit a few evenings out of the year if you know parents who would enjoy a date night or relieve a relative who regularly cares for an elderly family member.
Such gifts cost you next to nothing and are often the most needed and appreciated of all.
Plan your shopping strategically.
Create a free online budget and spending ceiling for every holiday item you plan to buy, including décor, co-worker gifts and “secret Santa” exchanges.
If you know you have issues sticking to a budget, leave the debit and credit cards at home and take cash or use a free budgeting tool, like the one from Mint.com, which provides mobile alerts and emails when you go over budget.
Plan to shop at a time when stores won’t be packed, even if it means making several trips. Scientific studies have proven that being tried, hungry and stressed lead to overspending, as does buying higher priced point items in tandem with lower priced ones.
For example, those $150 shoes may make those $75 sunglasses seem like a bargain, when you’d otherwise regard them as pricey.
Stephanie Taylor Christensen is a former financial services marketer based in Columbus, OH. The founder of Wellness On Less, she also writes on small business, consumer interest, wellness, career and personal finance topics.