Financial Therapy: Holiday Spending
It is the end of November (Black Friday, in fact), and the holidays are here. Thanksgiving is about gathering with family and friends and, of course, food, followed by Black Friday and now Cyber Monday - two of the highest consumer spending days of the year. December is host to several major holidays, including Christmas, which is very centered around gifts in many American families. New Year’s Eve & Day are frequently party days. Travel increases every holiday season for millions of Americans.
This is one of the biggest spending periods of the year in the USA…and the time that people’s relationship with money rears its head big time as we balance desires, worries, fears, obligations, guilt, exhaustion, and ambivalence regarding holiday spending. Below I have outlined several questions to ask yourself to help you make decisions in accordance with your needs, financial and otherwise. (If you need additional support in dealing with money this holiday season, reach out to set up a consultation for financial therapy.)
What kind of shape are my finances in this year?
Gently take a look back at how you have fared financially this year. Did you make more or less money than you expected to? Did you lose a job or gain a side hustle? Did major life events cause you to turn to your emergency fund? Did you tighten up spending because of the state of your investments? Be honest but non-shaming with yourself about where you are at right now with money. You are free to do what you want with your money, but please give yourself the gift of honesty and accurate information as you make decisions about holiday spending.
How am I feeling about my current financial situation?
After you have compiled your financial data from this year, give yourself some space to feel whatever emotions come up. Notice these feelings without judgment, whether you are feeling guilt, disappointment, joy, relief, panic, or love. It is important to take stock of your feelings so that you can have an idea of what you will be contending with as you later move into the decision-making process. (I am always a proponent of feeling and naming your emotions before making decisions, even if you make decisions that seem to conflict with your feelings.)
What kinds of holiday spending patterns have historically left me with feelings of regret or dread? What patterns have historically left me with feelings of ease and self-care?
It is time to think back on holidays past - what kinds of money behaviors have left me feeling like I neglected my own needs? Which patterns have had the opposite effect and left me feeling like I spent responsibly and in accordance with my values? It is not uncommon to overspend for various reasons - guilt around how much time you have (or have not) spent with certain people, pressure to keep up with other family members’ gift-giving, sadness you hope to mask with a festive persona, etc. Deciding whether to travel to other relatives’ homes for the holidays is another decision that is frequently tied up in feelings about family and about money. Do you ever stress out about the money and time required to travel, but you feel obligated to go even if it is at a detriment to yourself?
On the other hand, you probably have some really positive experiences to look back on. When have you made decisions and spent (or not spent) in ways that aligned with your needs at the time? What do you notice about past experiences in which you left the holidays feeling connected, refreshed, and in sync with your own needs? What levels of spending, gifting, giving, and traveling felt good to you? Reflect on what allowed you to feel whatever it was you were aiming for - peaceful, connected, relaxed, giving, spirited, protected, etc.
What ongoing issues with money get exacerbated during the holidays?
It is worth reflecting on what your ongoing issues with money are and how these might get exacerbated during the holidays. For example, if you struggle with keeping up with events and gifts based on your social circle throughout the year as birthday and wedding and baby shower invitations are issued, you are likely to feel pressure to buy gifts and travel in ways that do not align with your current needs and spending plans. If you struggle with gambling, you may have a hard time with recovery if you are traveling by casinos or spend time with family watching sporting events with betting options. If you struggle with underspending and depriving yourself when you have the financial resources to take care of yourself, you may turn down invitations because you fear something bad will happen if you spend this money on these experiences.
What kind of boundaries, financial and otherwise, would support my goals and needs this holiday season?
It is not only okay but necessary to identify what your needs are this year during the holiday months. Do you need to cut back on spending on gifts for dozens of friends and family members? If so, you might establish boundaries around what the budget is for certain gifts. Or you might propose a Secret Santa-type exchange within a group so that each person is only buying a gift for one other person. You are also free to opt out of gift-giving altogether! If so, give your loved ones a heads-up that you need to opt out this year based on your needs. Do you need to spend time in close connection with loved ones? If this is a need, it is worth looking at how you can reallocate your money these next few months so you can prioritize being with your people. Perhaps this year you need to opt out of some holiday gatherings - if this is true for you, what could you do with that money saved that would meet other financial needs you have?
One of the important things to remember about boundaries is that they are put into place to protect your own time and energy - we cannot control other people and what they do. A boundary we create tells us what we will do in response to circumstances. Other people often have negative reactions to our boundaries, so it is our job to uphold the boundaries we put into place - and it is common to need to give reminders when we do something different for ourselves. This could look like saying that you are happy to attend the party if it is held at a restaurant within your budget and/or if you can each pay for what you order. This could be arranging a Zoom holiday meetup if you cannot afford to travel this year. This could be letting your family know that you are not in a position to host this year but you look forward to meeting up with them at a park.
What are my non-financial goals for the holiday season?
Money is a tool that we use, save, exchange, etc. to support our needs, goals, and values. What, ultimately, are you aiming to do, have, and be this holiday season? When we talk about setting boundaries with money, we are really talking about how to manage so much more than just money. Go back to my question about what money patterns have left you feeling drained vs replenished, guilty vs responsible, etc. Pick several words that embody how you want to feel over the next month or so. What can you do to set yourself up for success in feeling at peace, or energized, or frugal, or giving, etc.? Money should support our non-financial goals - that is how it works. If you are struggling with figuring out these goals, sit down with somebody you trust (like a therapist, a partner, a friend) and talk through what you have experienced during holidays past and allow them to help you identify what works and what does not work for you right now.
Come January, how do I want to feel about how I have managed money the last few months?
Take a deep breath. Fast forward to 2025. It is a new year, and the holidays are over. How do you want to feel? When you look at your bank accounts, what do you wish to see? (Realistically, what do you want to see? Winning the lottery and having millions of dollars you do not currently have is not part of this exercise!) We can look at this and work backwards to now. If you hope to have x amount of money for January, based on your known or expected income from now until then, how much money do you have available for holiday spending? If the numbers do not quite add up, can you temporarily lower spending in other categories (like entertainment or eating out) to make up the difference?
But most importantly, get in touch with how you actually want to feel. Identify what emotions you hope to feel and spend some time identifying what actions you will take from now until then to support feeling this way in January.