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Have a Merry, Debt-Free Holiday

Five steps to saving money — and your sanity — this holiday season

By Marie Sherlock

Americans love the winter holidays. In poll after poll we agree that it's "the most wonderful time of the year." We look forward to gatherings, seeing family members, and enjoying the lights, traditions, food and more.

At the same time, the holidays stress us out. A lot.

A group of people opening gifts in Christmas morning. Next Avenue
The author's family white elephant gift exchange on Christmas morning  |  Credit: Marie Sherlock

More than three-quarters of Americans in another poll on the subject indicated that the holidays have become too commercialized and stressful. And last year 31% of us said that we expected to be more stressed compared to the previous year.

Our biggest holiday headache is spending — half of those surveyed reported being most worried about affording holiday gifts.

Adding insult to ironical injury, this annual angst springs from the simplest of origins: celebrating the birth of a child in an animal's manger, having enough lamp oil for eight nights and observing the return of daylight.

Christmas or Crass-Mess?

If you're harboring the reality-negating delusion that the holidays don't put a major dent in our collective wallets, take note: The 2023 Deloitte Annual Holiday Survey predicts that Americans, on average, will spend $1,652 this holiday season. All told, Deloitte projects holiday sales will total $1.54 trillion to $1.56 trillion.

Holy cow.

Meanwhile, a Harris Poll indicates that more than half of all Americans went into debt due to holiday shopping last year — and one-third of them are still paying off credit card balances.

It doesn't have to be this way. Our perpetual love-hate relationship with the holidays can be solved. Here are five steps to save money this holiday season — and save your sanity in the bargain.

Step 1: Soul Searching

The insanity and stress of holiday spending is really a microcosm of our uber-commercialized culture generally. Opposing overwhelming societal pressure to overspend during the holidays is not unlike resisting it the rest of the year. And your ability to do that is bolstered — immensely — if you know why you are doing it.

"It was hectic, we were too busy. The kids felt it too. We just didn't have fun."

Start with some soul searching, a time-honored and evidence-tested method for determining your values and discovering what gives meaning to your life. Ask yourself these questions: What did you love most about the winter holidays as a child? What do you enjoy about the holidays now? What do you truly dislike — or even detest?

With your responses front of mind, write down a description of your ideal winter holiday. This will be your blueprint for a more meaningful, less costly season. In one of the seminal books on simplifying the season, "Unplug the Christmas Machine," authors Jo Robinson and Jean Coppock Staeheli note that most people's holiday fantasies include "simple gifts, natural decorations, a fire, traditional food, leisurely schedules, music, time spent out of doors, an emphasis on family activities."

Kate Rhoad of The Woodlands, Texas, can attest to this. Before 1993, the Rhoad family — with three young children — had a pretty mainstream American Christmas. "There were huge amounts of presents under the tree, stuff the kids didn't need and couldn't appreciate," Rhoad says. "It was hectic, we were too busy," she adds. "The kids felt it too. We just didn't have fun."

In 1993, Rhoad and her family did a bit of soul searching — and decided to scale down both the overdoing and the overbuying aspects of the season.

Step 2: Focus on Meaningful Traditions

After that soul searching, the Rhoads decided to prioritize seasonal activities that were meaningful to them. "We made a list of things we really wanted to do over Christmas and put them on the calendar," explains Rhoad. Family members resolved to exchange simple (often homemade) gifts, and opted for activities like caroling with friends and walks in the woods.

That refocus saved them money: They went from spending over $1,000 just on those items under the tree to about $200 on everything — from gifts to décor. And the entire family was happier, says Rhoad. "Our intention was renewal, and all that buying had nothing to do with renewal."

"Our intention was renewal, and all that buying had nothing to do with renewal."

They also began a tradition of "adopting a family" each year. Today the Rhoads are empty nesters. "But we still, three decades later, buy Christmas gifts for a women's shelter family," says Rhoad, with their three adult kids still involved.

Charitable rituals like this three-decades-and-counting Rhoad family practice are, perhaps, the epitome of "meaningful tradition." Others center on faith, nature and family connection.

You'll find endless ideas online — from making gingerbread houses with the grandkids to watching "It's a Wonderful Life" together to keeping the Yule Log Channel on 24/7 during December. As long as it's meaningful to you, it's a candidate for a beloved family tradition.

Step 3: Downscale Gift Giving

Gift giving is the most common of all traditions of the season — and, as noted, the one many of us find most stressful.

There are myriad ways to scale back on spending. Agreeing not to buy each other gifts is obvious and straightforward. Drawing names is another — and putting a price maximum on those items. Donating to the giftee's favorite nonprofit blends the traditions of charity and gifts — a win-win.

"There were huge amounts of presents under the tree, stuff the kids didn't need and couldn't appreciate."

My family abandoned gift giving among adults four-plus decades ago. We substituted a White Elephant exchange. The rules vary a bit on these traditions but ours goes like this:

When the extended family gathers — up to 30 of us — everyone brings a wrapped gift. The gifts should be secondhand or garage sale items; the idea is to recycle, not use more resources. And the more ridiculous, the better!

Gifts are placed in the middle of the gathering and numbers are drawn. The person drawing No. 1 selects a gift. No. 2 can either open another item or take No. 1's gift — in which case No. 1 unwraps another gift. Everyone continues opening and "stealing" until all the gifts are unwrapped.


Creativity and humor are hallmarks of White Elephant exchanges. Many families have gifts that resurface year after year — "treasures" like singing fish plaques and the single bottle of "Hog's Breath" beer that started out as a six-pack 30 years ago.

Try it — you'll love it.

Step 4: Employ Holiday Hacks

For some, the first three steps will be adequate. Others may need a few workarounds, especially if it's their first effort to scale back on holiday spending.

There are countless apps to help you monitor (and conserve) your holiday spending. But here's a low-tech idea: use cash.

"We still, three decades later, buy Christmas gifts for a women's shelter family."

American Express has been urging folks, "don't leave home without it," since 1975. But it's proven that substituting cash for those magical plastic cards can save you money. Reward networks in the brain are apparently activated by credit card purchases resulting in what researchers call a "step on the gas" phenomenon — and more profligate spending.

Enter the envelope budget. This is exactly what it sounds like: Draft an estimate of what your gift giving expenses will be. Put that amount of cash in an envelope, withdrawing money as you purchase items. You may need to stretch those bucks a bit as you go along. But the science of "reward networks" will be on your side.

Finally, a plug here for "Buy Nothing" Facebook groups where folks offer up their unwanted items gratis to neighbors. Free is a very good price.

Step 5: Start Planning for Next Year

It may be too late this year to do much about your extended family's consumer-extravaganza. But December is the perfect time to start a downshifting discussion with them.

Your reward will be a saner, more meaningful — and less debt-ridden — holiday season.

Marie Sherlock
Marie Sherlock practiced law for a decade before turning to writing and editing in her 30s — and never looked back. She's worked as the editor of several publications and is the author of a parenting book (Living Simply with Children; Three Rivers Press). She spends her empty-nest days writing about travel trends and destinations, simplicity, spirituality and social justice issues. Read More
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