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The holiday season is a time for giving and sharing with family and friends, although it can be a financial burden to buy gifts for everyone that’s important to you.
Every year you face the same dilemma: What’s the ideal amount of money to spend on a gift that doesn’t seem cheap yet won’t break the bank?
Although the exact answer to this question depends on your financial situation, there are a few tricks you can use to make finding the perfect gift for everyone easier a bit less stressful!
Average Holiday Spending on Gifts
First, let’s take a look at how much the average consumer spends on gifts during the holidays. Last month, Gallup conducted a poll and found that most consumers in the United Sates plan to spend an average of $712 on average this season. This is also a 7% increase over last year. The National Retail Federation conducted a similar survey and found the average gift budget to be $750 this year per family. Consumers tend to break this budget down to:
- $421 spent on gifts for the family
- $75 spent on friends
- $25 spent on co-workers
- $28 spent on acquaintances, including preschool and grade school teachers, postal workers and delivery people
If you plan to spend around $500 this year on holiday gifts, let’s take a look at how that would break down.
Calculating How Much to Spend
Garth Sundem at Wired came up with a great way for calculating the amount to spend on your holiday gifts this year.
Start by figuring out your total budget. Let’s use $500 as an example as this is the average most families spend. Now, make a list of everyone you’re buying a gift for and give them a ranking from 1-10, with 10 being the highest. Multiply the number of people by the total of their ranks. Now divide your total budget ($500) by this number. Finally, multiply this new total by each person’s rank to decide how much to spend on each person.
Here’s an example:
Wife (10) + Daughter (8) + Son (8) + Father (3) + Mother (3) + Mother and Father in Law (2) + Brother (4) + Sister in Law (4) = total of 42.
$500 (budget) divided by 42 = $11.90
So, $11.90 x 8 = $95 to spend on a gift for your daughter.
Budget Recommendations for Everyone
- Co-workers: It’s usually not expected to buy gifts for everyone you work with, although some companies set up a gift exchange with a set limit.
- Preschool teacher: $20 to $50 is appropriate. You may want to get all of the parents together and collect for a gift from everyone.
- Babysitter: Double the babysitter’s pay for the last night before the holiday and add a small gift between $5 and $10. Gift cards are always popular.
- Friends: To show appreciation for your close friends, a good budget is between $15 and $25.
- Barber or beauty salon staff: For a barber, gift the cost of one haircut. For beauty salon workers, a small gift between $10 and $15 will do fine.
Just a reminder: Don’t forget you can use those credit card rewards you’ve been saving up to get the perfect gifts for everyone on your list. You probably have many ways to redeem your rewards, whether you want gift cards, merchandise, travel gifts or even unique experiences.
Consider Home-Made Gifts
If you don’t have much money for holiday gifts this year, turn to homemade treats and cards. These heartfelt gifts are always appreciated! Consider an assortment of homemade cookies in a gift tin, customized candles or baking kits. Remember: the best gifts aren’t about the money you spend, they’re a reflection of how important to person is to you.
If you aren’t the type that excels at homemade gifts or baked goods, give Etsy.com a try. Etsy features hundreds of thousands of homemade gifts made by individuals around the world.
You’ll find plenty of affordable and truly unique ideas here, from winter accessories and personalized items to handmade jewelry, stocking stuffers, wine accessories and snacks. You’ll find a little bit of everything and you may just stumble upon that perfect gift for your faithful and friendly postal carrier or even handmade wrapping paper to make your gift stand out.