You’re Invited…the Gift Budget

It’s back-to-school and that means back to the birthday parties. When your children are young, you buy the birthday gift for the many parties they attend but as they get older, what should you do?

As an adult, you have your own budget guidelines for birthday, wedding, and holiday gifts. For example, you might have a larger amount budgeted if it’s a close friend or family member. And holidays can be a big budget buster unless you have a plan. This budget category can be hard to manage even for adults so teaching your kids and teens to set a gift budget and stick to it is a good skill to learn. Remember that peer pressure to “give a good gift” can be strong but it is important to teach them to stay within their set dollar amount.

INCLUDE GIFTS AS A BUDGET CATEGORY IN THEIR ALLOWANCE

When you are determining the amount of allowance for your child or teen, you should have a budget category for gift giving and this amount will be part of their allowance. Estimate how many parties and events they will go to each year and set a dollar amount for friends and close friends. Younger children tend to get invited to many parties with general friends while teens will get invited to fewer parties but with closer friends. For example, you might help your teen budget for 2 good friends’ birthdays at $30 each plus 3 other friends’ birthdays at $25 each, so they will need to have $135 of their allowance set aside for gifts throughout the year.

MATCHING GIFTS

A few times my children have been invited to a close friend’s event (sweet sixteen or bat mitzvah) who is also a close family friend and I have matched the amount they have in their budget.

LEARN TO SET ASIDE PART OF THEIR ALLOWANCE EACH WEEK

Talk to them about how they will be responsible for using their money to buy the gifts for the parties that they are invited to. They will have to learn not to spend their entire weekly allowance but instead will have to put some aside for when they have to buy a gift for a party. This is an important adult concept—learning to set money aside for when the bill arrives. (Reminder that part of their allowance is already being set aside for savings and sharing.)

OTHER IDEAS

While it’s nice to be generous, gift giving can get out of control so talk to your children about ways to give that could be more unique and not as costly. Family members may appreciate a homemade gift instead of something store bought. Some friends and family may like you to make a donation in their honor to their favorite charity. Using coupons and shopping when there is a sale is also a great way to stretch their gift budget. Personally, my favorite gift from my children is a hug!

Enjoy the Party!