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Christmas Debt Will Affect Almost Half Of Parents This Year, But You Can Avoid It

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Steph Bazzle

Children sitting near gift boxes
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Money is tighter than ever for most Americans, and prices keep rising. Meanwhile, our kids are getting older, and their wants are getting more expensive.

In my house, much of the Santa talk this year has already centered on the newest game console released this summer, and if that’s not enough sticker shock, it turns out the games they already own have special downloadable content they can buy to add to the new console. Meanwhile, the littlest has already shared her wish list, and it’s essentially the entire pink toy aisle at Walmart.

Meanwhile, even the holiday meals are starting to look prohibitively expensive. As parents, what are we doing this year to maintain the magic for our kids without getting deeper into debt?

Embrace Some Honesty

Child Writing Christmas Letter, Happy Kid Write Wish List to Santa Claus
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For many families, this will be the year that kids learn that even Santa is limited by the family budget. (According to Parents, 45% of families expect to go into debt for the holidays.)

That’s not a fun lesson, but it is an important one, and each family will have to decide when and how to present it. Kids can be told that there is a Christmas budget, and that some things (perhaps game consoles and other big-ticket items) are outside of it, or that there will be only one bigger-ticket item per kid, for example.

This conversation can center on family values and things that are important besides material possessions, like love and spending time together. Some families also couple this conversation with acknowledging that other families are also struggling, and encouraging kids to donate lightly used toys and games they no longer play with, or even to take a shopping trip to purchase items for donation to families whose budgets will be even smaller this year.

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When kids are old enough, involving them in the family budget can help foster an appreciation for what they have, even if they’re not getting all they want.

Plan Time Together

In twenty or thirty years, sitting around another tree with their own kids, your children may cherish some memories of specific gifts. If you think about the gifts you remember from your childhood, though, you may notice a theme.

For instance, I remember the year I got bunk beds, not because of the bunk beds but because of the work my adults put into surprising me with them. I remember a specific plush because it was the first Christmas present my older brother ever bought with his own money. You likely have similar memories — maybe it’s not so much the Lego kit as building it with Dad, or it’s less the Barbie Camper set than the fun you had playing dolls with your sister that day.

Other holiday memories tend to hold on more strongly, like decorating the tree, baking cookies with family, participating in Christmas parades, and other events.

So, as parents, one thing we can do to help keep the holiday magic even when the budget is tight is to focus on time together. Watch your favorite Christmas movies, cuddle, visit loved ones, put together puzzles, and otherwise find ways to spend time together.

Set Priorities

Family bakes cookies
Photo by evgenyataman on Deposit Photos

What spending matters the most this year?

Do you need new decorations, or are last year’s fine? Are we buying Auntie a new candle for $30 because she wants one, or because we feel obligated, even though we know these gifts often gather dust or get regifted?

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Is this perhaps the year when you’d rather have an agreement that adults skip the gift exchange, or have a name drawing so that each adult buys one thoughtful gift for another, instead of spending on many smaller gifts that may not even be used or wanted? Or, a baked goods exchange, where everyone makes a different treat?

There is no wrong answer here—if exchanging gifts with extended family is vital to your family and the gifts are meaningful and appreciated, then keep it up. If it’s something that your family would be happy to alter or skip altogether, go for it.

Hold your loved ones tight this year, and don’t let holiday spending set you back from enjoying the next year together.