The holiday season has a way of sneaking up on us. One moment, you’re admiring the first snowfall; the next, you’re swamped by gift lists, party invitations, and endless ads urging you to spend more. While the season brings joy and connection, it often comes with an unspoken stress: the pressure to overspend. But what if, instead of getting caught up in the rush, you could take a step back and approach it differently this time around? By planning ahead and being more intentional, you can celebrate without stretching yourself too thin. Maybe this year can truly be different.
Why We Overspend During the Holidays
Have you ever felt the need to buy something just because it was on sale or worried that your gift wasn’t “good enough”? It’s not just you. The holidays are full of emotional triggers—like guilt, love, and social expectations—that can lead to impulsive spending. We want to show our appreciation for loved ones, but that often gets tangled with the idea that we need to spend big to show we care.
Marketers are masters at feeding into these feelings, using limited-time sales and social media ads to make us feel like we’ll miss out if we don’t act now. And then there’s the endless stream of picture-perfect Instagram posts showcasing expensive gifts and elaborate celebrations, which can leave us feeling like we’re falling short. Just recently, we went through Black Friday, Cyber Monday and Travel Tuesday. The pressure to spend vs miss out is immense.
Even though we feel we may be getting a deal, the truth is we tend to overspend anyway. This can leave you with major regret, stress, and a financial hangover long after the holidays are over. One small shift can help: pausing to ask yourself why you’re buying something. Is it out of genuine excitement, or are you feeling pressured? Recognizing what’s driving your spending can make all the difference.
Thoughtful Gifts Don’t Have to Break the Bank
“It’s the thought that counts” might sound cliché, but it’s surprisingly true in practice. Most people appreciate gifts that feel personal, not expensive. Instead of splurging, think about what would make someone smile or feel valued:
Write a heartfelt letter or create a scrapbook of your favorite memories together.
Plan a simple experience, like cooking a meal or taking a walk to their favourite spot.
Suggest a Secret Santa exchange or set spending limits with family and friends—it takes the pressure off everyone.
Some of my most memorable gifts have been incredibly thoughtful and low-cost. My best friend once made me a clay-painted mini version of my car, which I was sadly having to trade in. I was so emotionally attached to that car, and now I have a mini model to cherish forever. Another gift that stands out is a booklet my friend made for me titled "100 Things I Love About You". I received it over seven years ago, and I still read it when I need a pick-me-up to this day.
Having open conversations about budgets can feel awkward at first, but it’s worth it. Most people don’t want you to put yourself in a tough spot just to give them a gift.
Budgeting Basics for the Holidays
A little planning can go a long way in keeping your holiday spending under control. Here’s a simple approach:
Start with Essentials: Cover your must-haves, like rent, groceries, and bills, before deciding how much you can spend on gifts, outings, and decorations.
Set Clear Limits: Decide how much you’ll spend on each person or event, and stick to it.
Account for Extras: Wrapping paper, cards, and holiday treats add up. Including them in your plan will help you avoid surprises.
Pro tip: Use budgeting tools or apps to track your spending in real time. If you tend to overspend with cards, consider using cash—it’s easier to see when you’re nearing your limit.
Building Habits That Last Beyond the Holidays
Holiday spending often feels rushed and reactive, but it’s also a chance to start building better financial habits. Small, consistent changes make a big difference over time:
Make It Visible: Keep reminders of your budget handy while shopping, like a list or a savings tracker.
Focus on Meaning: Remind yourself that thoughtful, simple gifts carry more weight than flashy, expensive ones.
Simplify the Process: Use tools like automatic savings to build a holiday fund throughout the year.
Celebrate Progress: Reward yourself for staying on track—whether it’s with a cozy night in or checking an item off your list.
Over time, these small steps can help you feel more in control of your finances, not just during the holidays, but year-round.
What Do the Numbers Say?
On average, Canadians plan on spending almost $2,000 this holiday season (Johnson, 2024). For many, that’s a daunting figure. While not a representative sample, when we recently asked students at York University about their spending habits, almost all admitted they didn’t set budgets and felt influenced by ads or social pressure. Many said they wanted to create lasting memories but often felt they were trying to impress others or fill emotional gaps. This anecdotal information fits well with the actual empirical data and reflects what we see in daily life.
The takeaway? It’s worth reflecting on what the holidays truly mean to you. What do you want to prioritize—connection, joy, or material things? Aligning your spending with your values can make the season feel more fulfilling, without draining your bank account.
Focusing on What Matters
At its heart, the holiday season is about connection and joy—not debt and stress. By understanding the psychological forces behind holiday spending, setting clear budgets, and making small, mindful changes, you can approach the season with intention. It’s not about cutting back to the point where it feels restrictive but about creating a plan that lets you focus on what matters most.
This year, let’s shift the focus from spending to celebrating. With a bit of thought and preparation, you can make the holidays meaningful, memorable, and financially stress-free.
Sources
Lahav, E., Shavit, T., & Benzion, U. (2016). Can't wait to celebrate: Holiday euphoria, impulsive behavior and time preference. Journal of Behavioral and Experimental Economics, 65, 128–134. https://doi.org/10.1016/j.socec.2016.07.004
What a great post Abby!! This is a great way to educate everyone! Thankyou for sharing this post with us!!!
So true—easy to overspend—which ends up being stressful.
Yet another beautifully written blog Abby. Great reminder to spread the christmas love!!
What a meaningful post Abby! Such a nice way to educate everyone around this wonderful but expensive time of year.