By Erica Sweeney, Next Avenue Contributor
Last year, Paula Dofat started a new holiday tradition with her four sons, who range in age from 20 to 25.
Instead of undergoing the stress of getting them gifts, which she says will likely just “go out of style, depreciate or just get thrown in the back of a closet,” Dofat started investing in their future — literally, by teaching them how to handle money and by contributing to their Roth Individual Retirement Accounts, which she intends to do each Christmas.
To teach her sons about debt-free living, building wealth and budgeting last Christmas, Dofat gave them two books: Broke Millennial by Erin Lowry and Kakebo: The Japanese Art of Mindful Spending translated by Natalie Danford.
“I made the decision to stop giving material gifts unless they added exponential value to my sons’ lives,” says Dofat, 52, a college counselor at a charter middle and high school in Baltimore. “I thought about what I wish someone had told me or shared with me when I was in my early twenties, just starting out.”
What Her Grown Kids Thought About Not Getting Presents
Initially, Dofat’s sons weren’t thrilled with receiving retirement savings as presents. But, Dofat says, “it’s one of those times where I can say as a parent, ‘They’ll thank me later.’”
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Actually, Dofat’s decision seems to be getting across. Recently, she overheard her sons discussing exchanging gifts and asking one another what they need, not what they want. “I’d like to think my conversation had something to do with that, but I’ll take any step they take closer to moving away from the commercialism of holidays and mindless purchases,” Dofat says.
Her story illustrates a sentiment more families are feeling around the holidays: the desire to rethink presents.
Nearly 70% of Americans said they would skip the holiday gift exchange if their family and friends would agree, according to a 2017 survey by Harris Poll for SunTrust Banks.
Channeling an Inner Scrooge?
That doesn’t necessarily mean they’re channeling their inner Scrooge.
Money experts say it can make financial sense for families to cut out (or cut back on) gift-giving and overcome the pressure to spend at the holidays. Especially, they say, if doing so comes with a newfound focus on quality time with loved ones and teaching valuable lessons to younger generations.
And there certainly is pressure. The 2019 Consumer Holiday Shopping Report, which surveyed 2,000 adults, found that most plan to spend the same or more on holiday gifts this year as in 2018; that’s true for 81% of boomers.
The average amount people expect to spend, according to the survey: $862, up from $819 a year ago. That often means racking up credit card debt or dipping into savings to pay for the largesse.
The Pressure to Buy Gifts Can Be Intense
Many people in their 50s and 60s feel the pressure to spend on gifts especially intensely. With larger families than younger Americans (including grandchildren), they have more people to buy gifts for, says Brian Nelson Ford, financial well-being executive at SunTrust.
Meantime, a lot of holiday spending is wasted. More than 60% of Americans receive at least one unwanted holiday gift, according to Finder.com.
“It’s just a natural idea to say, ‘This is getting a bit out of control, and we may need to step back and re-evaluate what’s most important to us,’” Ford says.
Also, as families grow and financial situations change, long-standing gifting traditions might not make sense anymore. The truth is, you might not be able to afford buying as much as in the past. Or you might prefer doing your holiday spending in in more meaningful ways, such as through family experiences or by giving back.
How to Break the Gifts Tradition
If you’re ready to break your family’s holiday gifting tradition, clearly and honestly communicate that with your loved ones to ensure everyone’s on board.
They may also want to make a change, Ford says. “By being honest with friends and family, we not only relieve that pressure for ourselves, but for them, as well,” he says.
If you explain to family members that you can’t afford to spend on presents as you have in the past, Ford says, they will understand.
In fact, spending on holiday experiences like food, travel and social gatherings rather than on pricey purchases may feel more consequential for families. “It’s not always about gifts,” Ford says. “It’s about quality time. It’s about building priceless memories.”
Spending Time, Not Money
Embracing experiences over presents is a tradition for Bonny Meyer, 70, and her three children and five grandchildren (though, she concedes, she sometimes gets the grandkids presents).
Some of her children have even complained about having too much stuff.
Meyer is a vintner and impact investor in Napa Valley, Calif. Since her family members live in different cities, instead of having a gathering, Meyer usually visits her kids and their families to celebrate the holidays.
She spent Thanksgiving in Maui with one of her sons and his family and she does spa days with her daughter. Her other son lives in France and she plans to visit him for Christmas.
“It’s not that well-organized,” Meyer says, but celebrating the holidays with travel and experiences works for them.
Creating Lasting Memories
Volunteering together to help the needy, or pooling money to donate to charities, are other ways to create lasting memories and new holiday traditions.
“If you want to talk about having less stuff and less stress, the best way to do that is to shift your money and your time towards giving back and making it a fun tradition that your kids look forward to,” Ford says.
In short, re-evaluating holiday gift-giving gives parents and grandparents the chance to teach younger generations valuable lessons about spending wisely, focusing on family and helping others.