Last year, the average American spent $886 on family and friends. When you include birthdays, Easter, Santa gifts, an excellent report card, not to mention presents from family members and friends, the number of gifts starts to add up.
Many of those gifts will be forgotten at the bottom of a toy chest long before the next gift-giving occasion rolls around. So, if you feel like the holiday season is getting out of control or you don’t have the money to spend, try the Four Gift Christmas Rule.
My kids get more gifts during the holidays than they could ever enjoy. I remember sitting with my family on Christmas morning and watching my 2-year-old daughter ripping open presents, then promptly pushing them over to the side and asking for more, and that’s when I knew something had to change.
When you or anyone gives a child a gift, that is a well-meaning gesture. But when children receive too many gifts, it can create problems in the short term and throughout their lives.
The Traditional Four Christmas Gift Rule
The basic idea is instead of spending a lot of money on a bunch of presents to fill up space under the tree, you limit the number of gifts to 4 unique items for each to help make holiday shopping more manageable (and your family more appreciative). Now, the five-gift rule adds one more essential category, experiences.
The four or five-gift rule could turn into a beautiful family tradition for the Christmas season. The categories are as follows:
- Something they want
- Something they need
- Something to wear
- Something to read
- Something to do (this is the newly added category, which is my favorite)
This gift the child chooses for themselves is usually the “big” gift they receive. They can make a list of a few options, and the parents can decide, or they can choose one thing, and that’s what they’ll receive. The surprise is part of the fun of getting a gift, so the list of choices seems more exciting.
Depending on the child’s age, this could be up to them or the parents. It might be to start a 529 College Savings Plan for a baby. For a teenager going to college in the fall or older children, you might want to give them a big gift like a laptop.
Considering that four gifts are not overwhelming, maybe make the gift in this category a little better than new socks or underwear. Instead, a fresh winter coat or a new pair of expensive sneakers seem more appropriate.
For some of us, this overlaps with the first category. Books are the best gifts! This is another splurge category. If your child is tiny, maybe something like a whole set of Golden Books, and for the older kids, the complete collection of Harry Potter or the entire works of their favorite author.
Experiences always make the best gifts. A few great ideas to do with the family could be camping, an amusement park, a sporting event, tickets to a show, or a movie theater.
Gifting a Pile of Presents Won’t Be Remembered.
Do you remember what toys you got for Christmas day as a kid? I remember one, a Light Bright, and I think the only reason I remember that is because I remember turning off the kitchen lights and playing with it with my grandmother.
The only other toys I can remember are because there are pictures of me posing with them as I open them. Of course, your kids won’t remember all those plastic toys either. But You don’t want to feel like Scrooge during the holiday season.
So, what will they remember? Experiences.
Happy, lasting memories are created not by the money you spend but by the things you do together. So start holiday traditions the whole family can enjoy, like caroling or going to a tree farm to select and cut your Christmas tree. You want your family to have happy holiday memories.
Celebrate a birthday by taking a zoo or an amusement park trip. Decorate cupcakes together for Easter. It’s those things that children will remember and associate with holidays, that you spent time together as a family.
Will the 4 Gift Rule Work?
Should you try to get other family members who buy gifts for your children on board with the four-gift rule? That’s a personal decision. Some may be grateful for the decision, especially grandparents who have several grandkids to buy gifts for.
Some people may resent it and find it too controlling or miserly. You should probably pick your battle here. If implementing the four-gift rule is essential, explain why (or send this article!). In the end, you are the parent, and how you raise your kids is up to you.
If this is not a battle you want to fight, there are still ways to teach your kids that they can’t expect many gifts, which aren’t what makes you happy. You can try things like requiring them to donate an older toy to a children’s charity for every new gift they receive. Maybe for every X number of items donated, you will take them on a special outing.
If a family member asks your child for a list of gifts, only make a list a few items long. Ask that they contribute to your child’s college fund instead of buying many gifts. Then, you can steer them to certain types of gifts, things like board games and puzzles that can be enjoyed as a family, or active things like a yearly pass to a museum.
Do You Still Need a Gift Budget?
Yes, you need a budget for all of your spending. However, your gift budget shouldn’t be hastily scraped together at the last minute. It would help if you had a budget category for gifts year-round. Gift-giving occasions, Valentine’s Day, graduations, and anniversaries pop up all year. Many of these holidays shouldn’t come as a shock. For example, Christmas is on the same date each year.
Should your Christmas budget differ from past years if you adopt the four-gift rule? Yes, that’s part of the point. The main reason to do it is that children are not overwhelmed with gifts and expect that kind of generosity. But saving money is a motivator, too.
Raising kids isn’t cheap. It costs a quarter of a million dollars to do it for 18, which doesn’t even include college. The money you save by following the rule can be better spent buying your children food or health insurance.
Part of Parenting
It’s fun to spoil kids; they’re only kids for a little while. But that is the point of things like the four-gift rule and teaching good money habits early. They are only kids for a few years; they are adults much longer. The items you teach them as children will shape the kind of adults they become.
The first year with fewer gifts might be challenging, but it will get easier. Teaching children that material things don’t bring happiness will make them happier adults. Teaching them to be generous to others will make them kinder adults. And teaching them that they can’t have everything they want will make them better equipped to handle their finances.
Too many gifts can have negative consequences on their life.
Greedy children can become adults with compulsive shopping problems, credit card debt (fuelled by compulsive shopping), and even gambling problems.
Some parents use gifts to assuage guilt. Maybe they feel they work a lot and don’t spend much time with their children. Some might be non-custodial parents after a divorce and buy the children lots of gifts to make up for not seeing them every day, but having a lot of material things does not correlate with high self-esteem. Having a solid relationship with parents does.
Indeed, money doesn’t buy happiness, and receiving gifts doesn’t either. However, giving to others has been proven to increase satisfaction, so teaching children to be generous with others will provide them a source of happiness.
Added Benefits of Having a Gift Rule for Christmas
There are many great reasons to follow the four-gift rule that doesn’t involve raising grateful children. You don’t have endless amounts of money to spend on expensive gifts, and even if you set a gift budget, it’s probably a lot more than it will be when you adopt the four-gift rule or five-gift rule.
The four-gift rule is better for the environment. So much of what is made for children is plastic junk that will sit in a landfill, not degrading for hundreds of years. And it comes packaged in more plastic.
Manufacturing all that junk pollutes the environment, and much of it is made using child labor. Twenty million child laborers work in factories that manufacture toys, clothes, and carpets.
Christmas shopping gets hectic, especially when Christmas Eve is right around the corner, and you’re running out of ideas. Check out this list of stocking stuffers, gifts for 14-year-old boys, or things for five-year-old girls—potentially better options than a gift card.