Gift Giving and Budgets

Zen and the Art of Surviving Gift Giving

I have a confession to make. I find gift-giving one of the most stressful elements of the entire year, and it doesn't matter what time of the year it is, there seems to always be a birthday or a special event that warrants finding just the right thing. Research has shown that spending on other people makes us happier than spending on ourselves, but we also spend more time shopping for others than when we are picking something for ourselves.

When it comes to spending money on other people, choosing the perfect gift, and spending just the right amount of money can be an incredible headache. Unfortunately, I don't have a solution to the biggest question of “what to buy?”, but I do have some insights to share around how we can make this process work a little more smoothly for us.

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Expect the Unexpected

Budgeting for gifts has made a huge impact on reducing the amount of stress which hits me when I walk into the shopping centre. I put a certain amount of money aside each month, and track whether it needs to be adjusted over the year as I deduct my expenditure. This means that not only do I have enough to cover those expected annual gifts for birthdays and anniversaries, but when there's unexpected joy like a new baby or an engagement, I can buy a gift without worrying that I'm going to be eating plain rice or baked beans for a month. The money side of the equation is already taken care of.

The nature of my friendships also means that most of the birthdays fall at the same time of the year – there's a little cluster in December that would blow my bank balance out of the water if I didn't put money towards it throughout the year. Setting money aside regularly works like a baby emergency fund... and sometimes I get to use it on babies!

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Are we choosing the right gifts?

I'm sure almost all of us have experienced receiving a gift and wondering if the giver really knows us at all. I've been given beautiful blouses, which I'd never wear, or bath products which I can't use. A survey which asked people about their favourite gifts showed that meaningful gifts were valued far more than extravagant ones. Choosing a gift which is appropriate for the recipient is going to be valued more than just spending more money.

I'm always tempted to spend more to show how much I love that person, but when I'm thinking about myself, I know that it's the well-thought out and often practical gifts which have brought me the most joy. Research suggests that most recipients don't consider the cost of the gift when they're thinking about how much they're going to enjoy it. So spending to satisfy my affection might not actually translate to my loved one's happiness.

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Spread it out

For the predictable birthday and anniversary gifts, there's always the opportunity to plan ahead and buy the gift well in advance, when a sale comes up, or we find something we think would be perfect. When we have that budget set aside, it's possible to take advantage of those opportunities, in order to stash the gift away until the right time. Having the budget gives us the flexibility to do things when the time is right, rather than being rushed by an oncoming date.

This is the part I find the hardest, but making a list of gifts for the year, alongside the budget is sound planning which helps to take the stress out of the “what?” so that I'm not in a panic the day before, and it also helps me address the “how?” by ensuring I have the cost covered throughout the year.

My friends like to tease me about even my spontaneity being planned, but organising things like this means I have the confidence to spend when I see the perfect gift, and that allows me to be thoughtful without too much thrift and generous without guilt.

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*The information provided in this article is general information only and does not take into account your objectives, financial situation or needs. Before making a financial decision, please assess the appropriateness of the information to your individual circumstances and consider seeking professional advice.

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