The holidays are fast approaching and, for most of us, this is the most expensive time of year. It’s also a time of year that is chock full of “expectations” — whether it’s to pitch in more than you’d want on your mother’s gift or to attend every black tie holiday party under the sun. All of this can add up quickly and it can be hard to finesse your way through all of it once the holidays are in full swing.

That’s why it’s important to think about how to manage financial expectations now, so you can have a smoother holiday season later.


Identifying and predicting expectations

Managing financial expectations isn’t just about telling everyone you’re not going to be giving gifts this year or shouting your budget from the rooftops (although, there’s nothing wrong with either of those things). What it does mean is that you need to figure out what you do and do not want to do, and what financial expectations you may face from friends, family, and work.

Think about:

  • How you want to spend your holidays, whether it’s with family, friends, or on your own. If you don’t want to spend the holidays cooking or hosting everyone at your house, that’s an expectation you need to set!
  • How much travel you are reasonably able to accommodate this year. Don’t have enough PTO or can’t find a flight within your budget? You might want to have those conversations now.
  • What sort of holiday parties you might “have” to attend (i.e. work or friend parties). Think about what you’ve attended the last couple of years to get a rough estimate.
  • Who you want to buy gifts for, and how much you’d ideally like to spend. Sometimes, it helps to just pull out a pen and paper for this so you can remember everyone!

You also need to consider things that have happened in the past you know you want to prevent again this year. Maybe it’s:

  • Siblings setting a high dollar amount for family gift swaps
  • Parents expecting you to spend multiple weeks at home for the holidays
  • Friends who want everyone to pitch in for a big holiday bash
  • Bosses or clients to whom you feel “pressured” to send gifts
  • Arguing about budgets with your partner, who has more family or friends, or wants to spend more generously on gifts

There are countless expectations you face from people in your life around this time of year, and they’re different everyone. So really take a few minutes to think about what you want your holidays to look like, and what you want to avoid in holiday seasons to come (they may not be on the list above!). This is especially useful if you’re in a relationship and you each have your own set of expectations to juggle, whether at work, with family, or even with each other.

Getting clear on financial boundaries

Financial expectations during the holidays can feel like a landmine; you don’t want to offend anyone by spending more or less, but there are realistic financial limits in every person’s life. That’s why we think getting clear on those limits — or your “financial boundaries” — is so important. If you don’t have a clear idea on what you want (and can afford) to spend your money on during the holidays, you might find yourself falling prey to other people’s expectations for how you spend it. So, let’s set some boundaries.

Depending on your situation or preferences, you may feel the need to determine a “per head” gift limit, i.e. “I can only spend $25/person on gifts,” or “I only want to spend $500 total this year.” You may also decide to only buy gifts for immediate family, and ask friends to just spend a nice evening together. You’ll also need to set boundaries for other events and situations that call for money during the holidays, too.

There are work and neighborhood parties to consider, where you might need to find a new outfit to wear or a new dish to bring. There’s the “Secret Santa” event with your group of friends, or the price of flights to see your parents back home. And then there’s the cost of decorations, fancy holiday meals cooked at home if you’re hosting, and little things you buy for yourself while shopping for others (we all do it!).

All of that adds up, but it helps to think about it ahead of time and develop your own boundaries for them. Maybe you want to say “I’ll only attend 3 holiday parties and I’ll wear the same outfit to each of them,” or maybe you’ll ask your parents to come to you. Whatever those extra holiday expenses look like in your life, consider them and how you want to approach them.

You know what they say about the best laid plans…

You might be reading this and thinking “But I never know what’s going to happen during the holidays! That’s why it always gets out of hand!” And that’s true. The holidays always have a few curveballs for us. But when we take the time to get clear on what we want to do and what we want/can spend, it makes it a lot easier to navigate other people’s expectations. 

By setting up those financial boundaries, you can have an easier time turning down that 18th holiday party invite, or decline to stop by your aunt’s house for dinner on Christmas Eve. If there’s something that affects another person, it’s also important to communicate that once you’ve gotten clear on it yourself.

For example, let your siblings know that you have set a limit for your own personal budget, and ask if it would be possible for everyone to stay under a similar limit for gifts to make it comfortable for everyone. Maybe you tell your parents it’s not in the budget to fly home for Christmas this year, or let your friends know they won’t be getting gifts on all eight nights of Hanukkah.

Over the course of the holidays, there will inevitably be more things that crop up. By establishing your boundaries and getting clear on what you know you’ll need to spend money on, you can keep that in check while managing  — or just saying no — to the extras that crop up.

One final note: giving gifts and spending time with people during the holidays should bring you joy, not feel like an obligation. If you are feeling like it is an obligation or you feel resentment over gifts or events, it may be a sign that you need to revisit your boundaries.

Don’t let others take the joy out of your holiday season.