Budget Hive › Guides · Last updated: October 16, 2026

How to Set a Christmas Budget (and Stick to It)

The short answer

Decide how much of your holiday money goes to gifts. Write down every person you’re buying for, give each one a limit, and cross each name off as you buy. Decide how you’ll pay before you shop. [1] For the rest of the season (food, travel, hosting and your overall total), use our holiday budget guide.

What people planned to spend on gifts last year

These are 2025-season figures. 2026 per-person numbers weren’t out when we wrote this.

NRF (October 2025): of the $890.49 per person that shoppers planned for the holidays, $627.93 was for gifts for family and friends. [4]
Gallup (November 2025): Americans estimated they’d spend $778 on Christmas or other holiday gifts. Households earning under $50,000 estimated $384, and those earning $100,000 or more estimated $1,230. [5]
LendingTree (December 2025): 37% of people surveyed took on holiday debt, averaging $1,223. [6]

Use these as context, not targets. Your number comes from your own income and bills.

Step 1: Find your gift number

Start with the overall holiday total from our holiday budget guide. Plan gifts last. If you’re hosting a party or traveling, estimate those costs first, then see how much is left for gifts. [1]

Your gift number should cover wrapping supplies and shipping for anything you mail, not just the gifts. [3]

Step 2: Check last year’s gifts

Pull up last season’s bank and card statements and look at what you spent. [3] Were you happy with it? Has anything changed, like a job loss or a new child? [3] If you overspent, set a more realistic number this year. [3]

Step 3: List every person

Write down everyone you’re buying for: family, friends, teachers, coworkers, the gift swap at work. Check the list several times before you shop so nobody gets left off. [1]

Step 4: Set a limit for each person

Give every name a dollar amount. Add them up. If the total is more than your gift number, cut now.

Example with made-up round numbers, not a recommendation:

Gift number: $600, including $40 for wrapping and shipping, which leaves $560 for gifts.

Who	Limit
Two kids	$150 each ($300)
Partner	$100
Two parents	$40 each ($80)
Sibling’s family	$40
Four teachers and friends	$10 each ($40)
Total	$560

If you want to add someone, another name has to come down.

Step 5: Make the list smaller

Draw names. Suggest that family members draw names, so each person buys fewer gifts. [3]
Make some gifts. The CFPB suggests ideas like homemade hot chocolate or cookie mixes in a mason jar. [1]
Buy secondhand. Thrift or secondhand shopping can help, especially for big-ticket items. [3]
Say it out loud. If money is tight, it’s fine to tell family and friends that gifts will be smaller this year. [6]

Step 6: Save for gifts ahead of time

A sinking fund lets you save for a planned expense in small amounts over time. You can also use it to pay for gifts as you buy them through the year. [3] Keeping that money in its own savings account makes it harder to dip into for something else. [3] Our sinking funds guide shows how to set one up.

Step 7: Decide how you’ll pay

Cash: One CFPB tip is to bring only the amount you plan to spend. When it’s gone, you’re done. [1]
Credit card: A card can give you more consumer rights if an item arrives broken. If you use one, have a specific plan to pay the bill and set aside enough to do it. [1]
Buy now, pay later (BNPL): Many BNPL loans don’t charge interest, but most charge late fees. [2] They don’t offer the same dispute protections as credit cards. [2] If you return a gift, you may need to keep paying the loan until the return is sorted out. [2]

Of the people who took on holiday debt in 2025, 62% put it on credit cards and 35% used BNPL loans, according to LendingTree’s survey. [6] 63% said it would take three months or longer to pay off. [6]

How to stick to your gift limits

Cross off names as you buy. [1] Write the actual price next to each limit.
Compare as you go. Check whether gifts cost more or less than you planned. [1] If one comes in under, keep the difference instead of spending it on that person.
Count the small stuff. Stocking stuffers, gift cards and extra tape all come out of the gift number.

For tracking the rest of your holiday spending, see the holiday budget guide. For help year-round, read how to make a budget and stick to it or visit the Budget Hive.

Make it easier

Want it on paper? Use our printables to keep track as you go.

Not financial advice.

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