As the holidays approach, educating your pre-teens and teens on the differences between wants, needs, and nice-to-have becomes even more important. In fact, it’s estimated that children from 2 – 11 see more than 25,000 advertisements a year on TV alone and are quickly becoming one of the most targeted generations of marketing campaigns aimed at getting them to purchase and/or want the latest gadget, toy, brand name clothing, electronics, and moreˡ. Parents often feel coerced to spend more than they budgeted for the holidays just to keep pace with societal pressures. In fact, according to New York-based Deloitte, spending this holiday season will average $1,463 per household².
Are you prepared for the cost as well as how to navigate the expectations of the upcoming holidays? Here’s a checklist to help you get started:
1. Set reasonable expectations. Regardless of your financial situation, setting reasonable expectations for gifts for birthdays, special occasions, and the holidays just makes good financial sense. If you saved, planned, and budgeted for an over-the-top holiday extravaganza, then that’s great if you choose to do so! If you’d like to keep your holiday spending to something a little more manageable, then simply plan accordingly. Setting the expectations up front with your son or daughter for what the holidays might look like this year, is only going to help set the tone for what’s around the corner. It also helps to establish limits and emphasize the importance of good financial habits as he or she becomes an adult.
2. Get creative. Did you create a sinking fund for the 2021 holiday season or put cash aside in a cookie jar? If you’re like many Americans, that may not have been the case. If not, consider creative ways to make this holiday season special with things like experiences or making memories that aren’t overly expensive. “Finding unique ways to make the holidays special without breaking the bank is an ideal way to keep holiday spending under control,” said Jennifer Miller, First Bank’s Product Management Officer. “Consider a cookie baking and decorating night with friends or strolling through your favorite holiday light displays to enjoy the merriment of the season. For pre-teens, consider hosting a video game exchange or holiday ornament craft night with some holiday treats and music.”
To get a jumpstart on your 2022 sinking funds, read, “The Countdown is On: Have You Started Your Sinking Funds?”
3. Make a list and a budget. Have your son or daughter choose a set number of gift items and stick to the list. Some options are to purchase one or two larger gifts with smaller stocking stuffers to accompany them. “I’ve also seen parents adopt the theme of buy something you want, something you need, and something you can read, to keep the holidays festive. It also causes your child to truly appreciate what they’ve received,” she said. Don’t forget to shop around for the best deals and take advantage of any rewards or coupons, in order to find the one or two larger items he or she truly wants. “You may even ask friends and family to include part of your child’s wish list in their holiday gift giving. Often, family members are happy to know what your child wants or needs to make their gift giving much easier.”
4. Prioritize needs and wants. Are there things your son or daughter needs that you could include as part of the gift giving? Items like favorite body sprays, haircare products, soaps, gloves, hats, and needed shoes for gym class are all great ways to add gifts while also adding the value of something they need. If they truly want a higher-ticket item, like brand name clothing or electronics, consider giving them a gift card for half of the cost. Allowing your pre-teen to pitch in the rest from their allowance or savings is a great way to teach the value of shopping around and decision making before purchasing. Miller explained, “Teaching young adults the value of money and saving for larger purchases is an important tool for their long-term financial success.”
5. Help Kids Discover the joy of giving back. For many families, a big part of the holiday season is giving back to others. If possible, consider budgeting time and resources over the holidays to help give back to your community. “Setting some time aside to help at a toy drive can not only be a family holiday experience,” she said, “but also set an example for your children on the importance of giving back in the community.”
Need extra help funding the holidays and want to avoid higher-interest credit cards? As an alternative, check out the personal loan options from First Bank. With loan amounts starting at $5,000, a personal loan offers low, fixed rates, no origination fees, and no pre-payment penalties. It’s the simple, convenient way to make the holidays even brighter.
1Understanding How Marketers Target Your Children - Christian Parenting (crosswalk.com)
2 US Holiday Retail Sales Outlook Brings Good Tidings