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Tip #18: No Christmas gifts this year

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This is Tip #18 of of the Save $1,000 in 30 Days Challenge. (See past tips.)

Today’s tip is to skip the expensive Christmas gifts this year — which cost the average American over $850 last year — and instead give something more meaningful this year.


The economy is horrible. People are in debt and they’re losing jobs every day. Yet there’s one sacred cow that we can’t seem to shake — no matter how bad things get.

Christmas gifts: The things we love to complain about, but hate to be honest about. Can you even imagine calling your parents, or your girlfriend, or talking to your son about how you can’t afford to buy something this year?

Of course not. And that’s how we incur exorbitant debt, starting off each new year on the wrong foot. Instead of planning to get ahead, we’re already clawing back from debt.

Here’s an article Thomas Friedman at the New York Times just wrote:

I go into restaurants these days, look around at the tables often still crowded with young people, and I have this urge to go from table to table and say: “You don’t know me, but I have to tell you that you shouldn’t be here. You should be saving your money. You should be home eating tuna fish. This financial crisis is so far from over. We are just at the end of the beginning. Please, wrap up that steak in a doggy bag and go home.”

So I’ve come up with an idea that I hope you can share with your friends and family. It’s free, and it’s very simple, but the point is to share that you can do something for the people you love without spending money. In fact, I’m willing to bet they’ll respect you more if you look them in the eye and say, “Look, things are really tough this year. I can’t buy you a gift like I want to, but I’d love to help you out around the house or host a dinner so we can catch up.”

There are so many other things you can do together, and there is plenty of inspiration available.

I mean it when I say that money is only a very small part of being rich. And it’s an even smaller part of the holidays.

Total savings: $50 to $1,000

Last thing to do

  1. See other tips in the Save $1,000 in 30 Days Challenge
  2. Leave a comment on this post describing how much you’re saving with this tip and any unusual techniques you use to make this tip work.

If you liked this tip, check out my free Members’ Newsletter. Sign up to receive:

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  1. Hey, what about Hanukkah?

    My boyfriend’s parents called him today and mentioned that for the first time ever (he’s 25) they’re not doing Xmas presents this year.

  2. Just focusing on Christmas for now. Limited resources. I’ll think about expanding if it really takes off.

  3. How about let’s not buy *useless* gifts, or let’s buy them secondhand?

    Ramit, I like your positive approach to taking action. I can’t say I approve of Friedman’s FUD tactics.

  4. Christmas won’t be Christmas without the gifts.

    I don’t just buy gifts for the sake of giving rather I make sure that the gift is of value to the receiver. Something that is is very useful but not necessarily expensive.

    Recycle. Re-use. Repair. We just have to expand our creative minds to make Christmas spirit more meaningful.

    Happy holidays!

    • Christmas originally had nothing to do with gifts, honestly.

      It’s about celebrating the birth of Christ with family and friends.

    • Use it up, wear it out, make it do, or do without!

  5. You could just print out your own cards that read:
    Times are tough
    Money’s hard
    Here’s your ______ christmas card

    (fill in the blank with your favorite two-syllable explative … such as “f_____g” or “stupid”).

  6. I cut out Christmas gifts years ago. It wasn’t about money, though. It was primarily about not having enough time (although, time is money). A truly valuable gift takes hours to discover. I loathe receiving useless trinket junk as gifts, so I am not about to be one to give such a gift. They quickly add up through the many gift-giving holidays over the years, and either create unnecessary clutter or are junked.

    A gift that comes from the heart is tremendously better than a gift received through a social requirement. All of my favourite and cherished gifts have been received out of the blue on a non-holiday simply because the person was thinking of me. So, that is what I do now: if I truly care for someone, I give them a gift when *I* want to, not because some date rushed me to pick something.

  7. I understand doing this with friends, and even family. I often replace gifts with photos of our children we print for the grandparents, or having a day alone to spend with my mom, etc.

    But, there is no way I am going to not give gifts to my children. We have discussed the idea of doing a larger joint gift for the family like a bounce “house” or the like, but they are genuinely excited to make and buy things for each other. We also play Santa, and if Santa didn’t bring gifts then we would be ruining the magic of the holiday. Part of the reason I love Christmas is because it teaches my kids about GIVING, which in my opinion is a hugely important part of a healthy financial portfolio.

    I do think that most of the people I know make the holidays about the kids in their family.
    If you want to give to a child in your family without spending anything offer your time. Parents can always use a break, and kids always love someone who is wiling to play with them for a few hours.
    If you do decide to spend money, buy a family gift of a membership to a local museum or attraction the family can enjoy all year.

  8. Fine for family/friends/adults but the kiddos need to tear some paper.

    • I agree its fine with family and friends but kiddos need to tear some paper. But I personally think everybody expects a gift on Christmas whether its an adult or a kiddo. Recently I have read an article on thoughtful gift giving and I find it very interesting. The article gives an overview of how does one give a thoughtful gift. Please find it here: I hope your readers will also like it.

  9. First of all, I’m from Argentina… so I know a thing or two (or three) about living through an economic crisis and spending on a tight budget.

    I somewhat agree with the idea of cutting on christmas gifts… if times are tough and you want to save you can search for alternatives (e.g. two years ago I made a large batch of home-made peanut brittle, which can’t be ordinarily bought in Argentina, and gave it as a gift individually wrapped).

    … and yet… I think the idea can be read the wrong way, it’s a thin line between “No gifts for Christmas” and “A depressing Christmas”. It’s also a way of thinking that doesn’t work OK if you extrapolate it around a bit…

    … I used to work for a small software development company that was hit hard by the 2001 economic crisis and was forced to shrink quite a bit (no one was fired but as people left they weren’t replaced, we crammed in half the office space, etc.) During this time we weren’t always paid on time, no new software, hardware or furniture was bought, and all sorts of “bonuses” and “perks” disappeared… and I’m not talking about “Dot-com-era-style” perks… I’m talking about a free lunch, tickets to the theater, a bottle of champagne for Christmas, or any other small gesture which wouldn’t have represented more than 2% of the full salary. As a result of this “depression” we were in, the company REALLY suffered in human terms… relationships eroded… motivation was really low both in employees and management… and quite obvious mistakes started to be made (like neglecting regular visits to customers with maintenance contracts and losing them).

    … So, it’s OK to save and cut on expenses when times are tough… but you have to remember the meaning of gifts, their effect on people, and try not to lose that. Depressed and non-motivated people are no good at saving or making money.

  10. I think I’ll be cutting back this Christmas, and shopping for highly discounted items to give. My mom’s birthday is coming up and I got her a very nice Vera Bradley tote bag at 60% off, so it was $36 instead of $70.

    You can get nicer things for the people in your life if you get them on sale.

    Becoming The Marshmallow