How Are Parents Balancing Holiday Joy with Financial Reality in 2024?

The holiday season is notorious for being full of joy, laughter – and the occasional budget-induced panic attack. For parents, it's an especially tricky balancing act to spread holiday cheer while keeping finances in check and their kids (or picky in-laws) happy.

The current nationwide average of 1.85 children per household means most parents are buying for nearly two little holiday enthusiasts (who can rack up the requests like none other). Good news, though: kids rarely notice the financial fine print. The joy of unwrapping gifts, shared traditions, and time with loved ones often outweighs the sticker price of their presents.

Here, we'll take a closer look at how families are approaching holiday spending this year, and uncover some tips to maintain a festive spirit without breaking the bank.

Key Takeaways:

• Parents expect to spend $461 per child, on average, this Christmas.

• Nearly half, 49% of parents, expect to go into debt to pay for Christmas this year.

• Those going into debt expect to utilize credit cards (65%), and Buy Now, Pay Later services (21%).

• 24% of parents expect to gift their families experiences (e.g., trips, events) rather than physical items.

• More than half, 60% of parents, fear future tariffs will impact their ability to give their kids the Christmas they'd like to.

How Much Do You Expect to Spend Per Child on Christmas Gifts?

When it comes to per-child spending, the nationwide average is $461; however, families vary widely in their budgets:

• Big Spenders: 9% of parents will spend $1,000 or more per child. (Ponies, anyone?)

• Middle Ground: The vast majority of parents say they'll fall into the $250–$749 range, with 31% spending $250–$499 and 29% spending $500–$749.

• Budget-conscious: 17% plan to drop less than $250, but more than $100.

• Savings City: A mere 4% plan to keep it under that $100, but they are still intent on making the most wonderful time of the year as special as possible.

Christmas Gift Spending Per Child By State

Geography plays a significant role in holiday spending, with some states embracing their collective inner Santa Claus more than others. Here's a breakdown of the top three highest and lowest averages:

Top-Tier Spenders:

• New Jersey: $712

• Texas: $659

• Pennsylvania/Massachusetts: $648

More Modest Budgets:

• South Dakota: $247

• West Virginia: $255

• Nebraska: $263

While some states go big, others embrace more frugal holiday traditions. Regardless of where you live, the key is to focus on thoughtful, meaningful gifts rather than the price tag – and that's because creating a memorable holiday season doesn't have to break the bank. Here are some tips to balance joy with financial reality, no matter what state you live in:

• 1. Set Expectations Early: Talk to your kids about holiday plans, focusing on the spirit of the season and why that's what really matters.

• 2. Shop Smart: Look for sales, use coupon codes, and start early (now?) to avoid last-minute splurges and scoop-ups.

• 3. DIY Magic: From homemade ornaments to baked goods to whatever creative concoction you can come up with, DIY gifts can be just as special as store-bought ones.

• 4. Give the Gift of Time: Plan family activities throughout the month, like decorating cookies, watching holiday movies, or visiting local light displays, to add warmth to your home and take pressure off of the upcoming exchange.

Do You Expect to Go Into Debt for Christmas Gift Spending?

According to our data, 49% of parents anticipate going into debt to fund Christmas gifts this year. Meanwhile, 46% plan to avoid debt, and 5% aren't sure yet (likely hoping for a last-minute holiday miracle). We won't lie: the fact that just about half of those we surveyed are willing to bust their bank accounts so their loved ones have that sparkle in their eyes come the big day is both very heartening – and a little scary.

Even if you're not one who expects to borrow a bit of cash money to make your holidays merry, this should still be a stark reminder of the pressure many families feel during these moments to go above and beyond. No matter what side you're on, setting clear boundaries for yourself is critical; after all, the joy of giving shouldn't come at the cost of financial stress come January.

Pro Tip: Create a holiday spending plan early, and write down everything you need to buy including gifts, meals, decorations, and travel expenses. A clear budget will help tame overspending!

If You Expect to Go Into Debt, Which Financing Options Will You Use?

Among families expecting to borrow, credit cards still reign supreme, with 65% choosing this method even amidst the surge of Buy Now, Pay Later (BNPL) options like Affirm and AfterPay (which account for 21%). Thankfully, only 5% plan to take out personal loans, and another 5% plan to explore alternative financing methods – which hopefully doesn't include tapping into retirement funds.

While the almighty credit card offers convenience and rewards (especially depending on your payment network), they can come with high interest rates and fees if balances aren't paid off quickly. BNPL services, on the other hand, spread out their payments in amounts you feel comfortable handling over time – though they often have hidden fees or strict repayment terms.

Pro Tip: If you're using credit cards, prioritize paying off balances immediately after the holidays, and leverage cashback or rewards programs to offset costs. If you're choosing a Buy Now, Pay Later option, ensure you can meet the repayment schedule before committing. Side hustle money, anyone?

Do You Fear Future Tariffs Will Impact Your Holiday Spending?

The global economy's influence is inevitably seeping into holiday planning. A solid 60% of parents are worried about future tariffs affecting gift affordability and timeliness. Although 31% aren't concerned and 9% are on the fence, it's a reality that will likely impact many families.

Naturally, an increase in prices will push some parents to rethink their shopping lists and explore alternatives such as locally made gifts, secondhand treasures from a thrift shop nearby, or even burning the candle at both ends by creating handmade items from the heart.

Pro Tip: If you're nervous about how you can make the holidays magical, consider organizing a "gift swap" within your family or extended community, where gently used toys, electronics, or other items are exchanged. It's a sustainable, cost-effective way to give meaningful gifts – and maybe discover some presents you never would have thought to purchase in the first place.

Do You Expect to Gift Your Family Experiences Rather than Physical Items?

Gifting experiences like trips, events, or memberships is a practice gaining popularity, and it's a great way to avoid shipping times and long lines – but only 24% of parents plan to do so this year. The majority of people (73%) are sticking with physical, unwrappable presents, while 3% don't have their giving plans locked in quite yet.

Experiential gifts can be a wonderful alternative, offering long-lasting memories rather than fleeting enjoyment. That said, many may hesitate due to upfront costs, organizing multiple schedules, and overall availability in their surrounding area. But is there a happy medium?

Pro Tip: Combine smaller physical and less expensive experiences together to create a gift that keeps on giving. Perhaps that looks like buying an instant camera with plenty of film, taking your family to a nearby zoo, concert, or landmark, and saying, "cheese" at least a dozen times – planning all the while to create a scrapbook together when you get back home.

The Real Heart of the Holidays

At the end of the day, the best gift you can give your children is love, time, and a little holiday magic. Whether you're spending $50 or $500, the memories you create together will outshine anything wrapped under the tree.

So, parents, take a deep breath – you've got this. And, if all else fails, there's always the classic holiday standby you can buy a (couple) dozen of: socks.

Methodology

This survey was conducted in November 2024 among 2,500 American parents (50 from each state), with 54% identifying as women, 45% as men, and 1% as other gender identities.

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