Personal Finance | December 13, 2022

5 Tips for Holiday Giving With Care, Not Cost

Dear Readers,

For the last couple of years, the holidays have been a challenge for a lot of reasons. This year, just as many of us hoped to get back to normal, we're again faced with economic concerns. Sky-high prices, interest rate hikes, the threat of a possible recession—they can all cast a bit of a gloom over our holiday gift-giving plans.

I've talked in the past about creative and meaningful ways to give that don't have to strain your budget during difficult times. Now I'm beginning to think this approach to gift giving should be the new normal. And why not? A meaningful gift is appreciated no matter the economic climate. Being creative is fun, no matter your budget.

So to help you approach the holidays this year with less stress and more spirit, here are my top five ways to express your love and appreciation for family and friends that will not only show them you care, it will also help you keep the cost in check.

1) Start with a list

As much as you'd like to include everyone, it's a challenge to give meaningfully to every family member, friend or co-worker—even if money isn't an issue. So first, make a list. Put your dearest family members and friends at the top and work down to the others in your life that you want to acknowledge in some way.

Think carefully about each person. What would they most appreciate? It's not just about how much money you spend, but rather about why you think a certain gift will be just right. For some people on your list, a small token will be meaningful. For others, your creative approach may make their gift even more special.

2) Set realistic spending limits

Figure out exactly how much you can afford to spend on all your gifts this year. Choose an amount that doesn’t eat into your necessities or your savings, and stick to it! In the age of online shopping and buy now, pay later options, it's way too easy to buy on impulse and overspend. Often the best gifts cost very little.

3) Think outside the box

This is the creative part. While it's fun to see the happiness and surprise on someone's face as they open their present, not every gift has to come in a traditional box, wrapped and tied with a ribbon. In fact, a number of studies have shown that most people derive more long-lasting happiness from experiences than material possessions. So what kind of experiences might you offer?

Do you have friends who are new parents? How about volunteering to babysit, complete with a dinner out? Or maybe you could give a young family a membership to the local zoo or museum. Perhaps your parents would enjoy a few ballroom dancing lessons or tickets to the local theatre. A teen might be thrilled with concert tickets or appreciate a boost to their savings or 529 account. Others might be grateful for a gift to a charity made in their honor.

4) Make it about time, not money

We all have such busy schedules, that sometimes the best gift is just spending time together. Whether it's with a friend or family member, arranging a special outing—a dinner, a ballgame, a weekend get-away—can be the most perfect gift of all. If you have the ability to foot the bill, great. If not, sharing the cost as well as the experience can be just as thoughtful.

5) Reach out

With so much in the press about isolation and depression, and especially the loneliness that many people feel during the holidays, just the simple act of reaching out could really raise someone's spirits. Is there an old friend you've lost touch with or a relative who lives far away that you haven't spoken with for a while? Whether it's a phone call, sending a card or a photo with a note that sparks a memory, find a way to reconnect. That could lead to a whole new set of experiences for both of you—a mutually rewarding gift.

Personally, I love the holidays and I love giving gifts. But I've come to appreciate so much more the small yet personal expressions of caring that, to me, show the real spirit of the holidays. If you can find a way to express your own spirit, it won't matter how much or how little you spend. The people on your list will just appreciate that you cared enough to think of them.

Have a personal finance question? Email us at Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.