Control Your Holiday Spending Without Being a Scrooge

Try these creative gift-exchange ideas that let you stretch both the fun and the dollars

by: Jeff Yeager | from: AARP | Updated November 2011

Given that Christmas has ballooned into a nearly $400 billion spending spree here in the United States, I sometimes think that Ebenezer Scrooge should have stuck to his guns and ignored those three spirits who visited him on Christmas Eve.

According to a recent Gallup Poll, the average American adult expects to spend about $764 — on gifts alone — this holiday season. At the very least, with the economy still off-kilter from too many eggnogs, a little temperance seems to be in order this gift-giving season. Who knows? A simpler, less materialistic holiday might just be a more memorable and enjoyable one, too.

So how do you handle that potentially awkward conversation with family and friends? You know — the one where you broach the subject of maybe cutting back on giving presents, or even entirely forgoing the gift exchange this year?

— Deborah Harrison/Getty Images

The important thing is to have the talk and to have it early. Waiting until everyone is happy and relaxed after a massive Thanksgiving feast might be the perfect time to bring it up, but by then, your family members might have already started their holiday shopping.

With friends and relatives you don't often see, a thoughtful letter or e-mail suggesting that maybe it's time to take a different approach to gift-giving is perfectly acceptable, according to Peggy Post. She's the great-granddaughter-in-law of etiquette queen Emily Post and a director at the Emily Post Institute.

Many families put a cap on holiday spending by setting and sticking to a maximum amount per gift or by giving presents only to children under a certain age. In addition to a strict $20 spending cap, members of our extended family stop giving nieces and nephews Christmas presents once they turn 18. At that age, youngsters become part of the "Secret Santa" plan for adults. That's our arrangement: We all draw names ahead of time and buy a gift for one other adult family member, so that we all have something to open.

If you've fallen into the habit of exchanging gifts with adult friends and colleagues and find that it's adding up, why not agree that it's a habit in need of breaking? What about just exchanging holiday cards instead?