With gatherings to host, travel expenses, and numerous gifts to purchase, many people are considering drastic measures to reduce holiday expenses. Would you join them?

The holiday season has arrived, bringing with it the pressure to stretch budgets to uncomfortable limits, as highlighted by a recent survey on holiday spending.

Feeling the financial strain? One bold strategy might be to forgo gifts entirely. Imagine telling your loved ones, “This year, no presents. My finances say otherwise!”

It may sound extreme, but a survey shows that 16% of respondents (about 38 million Americans) are open to boycotting holiday gift-giving to manage their expenses.

Causes of holiday spending anxiety

During the holidays, opportunities for overspending abound. It's not just those lacking willpower: a significant two-thirds of participants admitted to feeling pressured to exceed their financial limits this time of year.

Raise your hand if you’ve felt your budget slip away even before making any purchases! Just seeing airfare prices for my hometown in Kansas made me rethink my Thanksgiving plans and consider cotton instead of cashmere for gifts. (Sorry, family!)

According to the survey, 16% of individuals (38 million Americans) would consider skipping holiday gift-giving to reduce their spending.

Holidays can be quite costly: the average planned expenditure is $1,047.83, according to the National Retail Federation. Shoppers aged 35 to 44 plan to spend the most, averaging $1,158.63.

As a financial writer, it’s my duty to point out where that money could go instead. If you invested that $1,047.83 rather than splurging on gifts, with a 6% annual return, you could see an extra $800 in ten years. Leave it for 25 years, and you might be looking at almost $4,500.

Parents with kids under 18 feel the pressure most, with 71% confessing they’ve spent more than they intended on gifts. But they’re not alone in feeling the holiday spending strain:

  • Over one-third (36%) of holiday hosts admitted to exceeding their entertainment budget.
  • One-third (33%) of seasonal travelers have gone over budget on travel costs, leading nearly half (45%) to consider skipping travel altogether.
  • Even the most generous donors feel the squeeze, as 36% reported feeling pressured to give more than planned.

Strategies to reduce holiday spending

Completely skipping celebrations might not be feasible if friends and family expect your presence (and possibly some gifts). But you can resist the urge to overspend.

To stay within your budget, communicate your plans with loved ones, suggests a data analyst. “Get innovative and find different ways to give this holiday!” You don’t even need to be particularly inventive. Here are some ideas:

  • 41% of gift-givers might cut back by embracing regifting (24%) or choosing secondhand items (19%).
  • More than half (53%) would limit gift exchanges to immediate family.
  • Another 53% are on the lookout for coupons and sales.
  • Homemade gifts appeal to 36% of crafty individuals. (Check out tips for creating your own holiday cards.)
  • For travel savings, 38% would opt to stay with relatives rather than book a hotel.

Ways to control holiday expenses

Looking for additional methods to keep holiday costs down?