Gift Spending: Am I Cheap?

First, let me start off by saying, "Happy Valentine's Day."   My wife and I have decided to postpone our V-day celebration until tomorrow, so for me today is just another day.  It will allow us to make our celebration a part of the weekend and enjoy the special day a little bit more.  It will also let us have the house to ourselves for a whole night without interruption.

When I start thinking about Valentine's Day the first thing that comes to mind is flowers, chocolate, and other gifts.  In my attempt to be responsible with my money I would prefer to minimize the emphasis on gifts and instead spend romantic time with my wife.  I don't like to buy flowers; they die.  I don't like to buy chocolates; they are consumable.  I don't like to buy other gifts much either!

Okay, so am I a jerk or what? 

In my family gifts were approached very gently.  My parents gave us gifts twice a year, birthdays and Christmas.  We did other special things for the minor holidays but not presents.  The gifts were not particularly lavish and not particularly stingy; $100 range for birthdays and $300 range for Christmas.  We were middle to upper-middle class and this seems reasonable to me still. 

In some years it would be a little more or a little less in order to fit the circumstances.  I know that the year my brother asked for a telescope my parents went all out.  Mom taught astronomy at the community college level and this was a veiled excuse for her to indulge.  I'm pretty sure they spent $500 that year for my brother's main gift, but in a way it was also a gift for the rest of the family too.  When my wife and I were getting ready to buy our house my parents gave us a very generous Christmas gift to buy furniture for the house.  In other years it is much less.

Our family did not stress gifts between siblings or from the children to the parents.  These gifts were normally either hand made or bought for less than $20.  We also did not buy gifts or expect to receive them from our extended family.  Most years (but not all) my grandparents would send between $10 and $20 for these occasions but never more.   As we got older and outgrew the traditional children's birthday party we did not exchange gifts with our friends either.  A phone call, card, or more recently an email, IM, txt, or Facebook poke is all that we might expect; even then it was not a big deal if someone forgot.

Now that you understand my background you might begin to understand why I feel that gifts are such a minor part of celebrating birthdays and holidays.  I never felt that there was anything wrong with this approach until my wife and I got engaged.  Her family is completely different.  Gifts are expected from each member of the family on a birthday and everyone buys everyone else gifts for Christmas.  My old Christmas budget of $50 for family gifts is now more like $500!  In her family, the price ceilings for each gift are about double what we ever spent in my family.  Each side of grandparents gives everyone $500 each year for Christmas and $250 for a birthday!  That is several times what I ever got. 

My wife also has a tradition of exchanging gifts with her closest friends on their birthdays.  She normally spends around $25 but if there is something special that catches her eye or if it is a milestone birthday like 16, 18, 21, 25, ... $50+ would be in the range of possibility.  My wife is a wonderful generous person and I love it, but getting accustom to her approach to gifts has been a difficult transition for me.  I feel like a cheapskate.

I'd like to hear what others think about gifts and how their family approaches the topic.  Thanks for reading.

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My Holiday Recap

Christmas has come and gone till next year. It was an INSANE time here and I'm sure it was the same for most others too. We drove about 1000 miles and spent time with nearly all of our family. We also got some really nice gifts, and the gifts we gave seemed to be well received.

We got a nice mix of books, ornaments for the tree, and clothes. I was totally surprised when my parents gave me a 16 Gig iPod Touch. It was something I would never have bought myself so it made it that much cooler to get one. My wife got a Kitchen Aide mixer that she had been drooling over for months. We also got a fairly significant sum of cash that will refill the coffers and allow my wife to buy a bunch of new clothes that she needs (for a new work wardrobe).

Of all the things we did during our Holiday, I think we had the most fun playing an assortment of board games with our family. My wife and I picked up a couple new games that ended up being big hits. Crainium and Catch Phrase were both new purchases that definitely were worth the money spent. My mother-in-law also picked out two award winning games that we had never tried and gave them as 'family gifts'. Blokus was perfect for the analytical types like me and Quiddler was one of the best word games I have ever played. It was like a mix between Scrabble and Rummy, and even though I am a terrible speller I did pretty well. I think all four games will certainly be played again (and again).

I spent the whole week away from the computer and Aspire 2 Wealth. While I was gone I was included in the Carnival of Personal Finance hosted by The Digerati Life. It was a great set of Holiday Themed articles that you should check out. My wonderful wife also let me know not too subtlety that she was jealous of the time I've been spending on the blog (at least 2 hours every night after work). I missed the site over the break so Adfecto is going to keep on blogging, but I think in the future I will slow down a little bit and post 3-4 times a week instead of pushing hard for my original goal of 7-8 posts per week. I am all about balance in life and this will be no exception. Till next time... thanks for reading.

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Spending on [Hidden] Holidays

Does it ever seem like there is ALWAYS a holiday or special occasion right around the corner? I never manage to remember all of the birthdays, Hallmark holidays (Mother's Day, Valentine's Day, etc), or excuses for a party. It seems like there is always a special reason to 'bend' the budget or make an exception. For example, I had the Christmas season all worked out. We had even bought all of our gifts and had them wrapped. Everything was ready except... I forgot my mother-in-law's birthday was a week and a half before Christmas, and we needed to buy a second gift for her. I also picked up a few board games and some snacks to contribute to our family get-together before Christmas. Neither was in my budget. I came across this great article in the NY Times by M.P. Dunleavey that seems to explain the problem of money that disappears. J.D. at Get Rich Slowly also wrote about the article and sees the same problem in his life.

My problem with the article was that many of the 'leaks' in their financial plan were things that I consider reasonable spending. For example, picking up a prescription, volunteering to bring dessert to a dinner party, and buying a birthday gift for a friend. In my opinion, spending money on these types of items is not optional. It is a part of a healthy balanced life. The trick is keeping these types of expenses in balance with the rest of your life. Include them in your budget. For 2008 I plan to add a 'Special Occasion' category to my monthly budget with about $50/week to spend. By adding these lifestyle expenses to my budget I can ensure this does not end up adding to my debt and it forces me to keep everything in balance with my financial goals.

As I've written before I do think that the Big Things are the most important. A $30 a day leak in my finances that did not fit into any budget category becomes a big problem. It does remind me that there is a cross over from where small spending amounts to large sums. But to combat this I do not think it is a good idea to take away your ability to socialize or give gifts. Socially handicapping yourself to get rich later is not the kind of life I aspire to.

For the next few days I will be traveling to my in-laws for Christmas. I'll try to check in and make a few posts; no promises. I'll also be working to leave the plastic in my wallet too. Merry Christmas!

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Holiday Blog Roundup

The season is upon us so I thought I'd scan the blog-sphere for the best money tips for the Holidays. 

Gather Little by Little compares the strategies of buying multiple moderately priced gifts or a single expensive gift.  My family has historically done a hybrid where each kid would select one large gift that would be about 1/2 to 2/3 of the total spending and then we would each get about ten other smaller gifts.  This year we tried a significant reduction in the number of gifts and it looks like it will be a better solution (especially now that I'm older and get less of a thrill from the unwrapping process).

Being Frugal gives us a tip on an easy and frugal Christmas breakfast.  Our family had a Christmas breakfast tradition that I remember fondly today.  I'd recommend finding something that works for your family and making it your special Christmas tradition.

Free Money Finance looks at Christmas spending in a new way.  How many hours (or days) do you have to work to pay for your Christmas spending this year?  I think my total for gifts and travel will approach a week worth of take home pay; roughly 2% of my spendable income.  Is that a good amount?  My wife tends to think I'm a bit of a Scrooge but I don't think so. Feel free to chime in with your comments.

Cash Money Life has a great issue of the Carnival of Financial Goals - 2008 Resolutions Edition.  I think writing resolutions and goals for each year is a great practice.  I haven't written mine yet but look for them to be posted in the near future.  I do know that paying down my debt and increasing my Roth IRA contributions will definitely be near the top of the list.

Housing Panic give us a reminder of the recent real estate turmoil and how it may be a harsh wake up call for many this year at Christmas.  The real estate ATM is closed for business.  Check out the article to read more about how it is going to effect everyone this year.

Thanks for dropping by for this roundup.  I'm taking off this afternoon to spend a few days with family.  I hope you are able to do the same.  Happy Holidays!

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Christmas Shopping Success

Yesterday my wife and I finished our Christmas shopping. I had set a budget of $150 for the remaining 6 people on our list. We decided to drive 90 miles to go to one of my favorite gift buying stores, World Market. My mom criticized me for "wasting gas" when I talked to her during the drive but we managed to find gifts for everyone with a single trip which overall made the gas worthwhile. I'm sure we could have burned just as much gas going to a dozen stores locally to find gifts but I much prefer making one efficient trip. The final total was $110 plus $20 for gas which was less than the total budget and we are very happy with everything we picked.

I had a long list of things to get done this weekend to prepare for family visiting next weekend (and for the blog too). I haven't gotten any of it done because I started feeling sick last night and it only got worse today. I'm going to keep this short and get back to bed. Hopefully tomorrow I'll be up to writing a thoughtful article. Till next time...

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Thanksgiving Holiday

I am leaving early tomorrow morning to drive to my in-law's house for Thanksgiving. That means it is rather unlikely for me to make any posts for the next 5-6 days. It also means that I will be driving my wife's car 1390 miles round trip. According to AAA (http://www.fuelcostcalculator.com/TripGasprice.aspx) I will burn 51.48 gallons of gas with a total expected cost of $154.94. Wow! Holidays don't come cheap. The trip will also take almost exactly 22 hours round trip, which adds up to hundreds of dollars when you consider the opportunity cost of lost work.

Thankfully I am not making the drive alone because my wife and her aunt are sharing the car. I also like my in-laws (amazing I know). The wife has also promised me the best and most massive home cooked Thanksgiving dinner known to mankind for my trouble. When you add it all up, the family and the experience greatly outweigh the costs for the trip. As an added bonus, my wife's aunt has even offered to pay for half of the gas and her dad will cover our meals once we get there. The moral of the story, think about the costs of your Holiday festivities and be smart about how you spend (like ride sharing), BUT always remember that the true thing to be thankful for is that you have loved ones to spend the Holidays with.

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