The Four Steps You Can Take to Maximize Happiness This Holiday Season
“The excellence of a gift lies in its appropriateness rather than in its value.” – Charles Dudley Warner
Our Favorite F Words Part 2: Family & Finance
Over the next few weeks we’ll be diving in deeper to our favorite F word, Finance, and how it relates to the other important F’s in our lives, Family, Friends, Fun and more. If you missed last week’s entry on Food, start here.
There’s something magical about this time of year. It’s a time when many people travel far and wide to see their families, take some well deserved vacations, and feel warm and fuzzy on the inside. Family is incredibly important to many people year round, but we all feel a little closer during the holidays, singing familiar songs, eating familiar food, and surrounding ourselves with familiar people.
Yet underneath this cheer, the holidays also bring a little anxiety for many of us. “What should I get my mom?” “How long will I have to stand in line?” “Will everything I ship get there on time?”
From birth to death our families help make us who we are and shape who we become. And for better or worse, this influence extends to the realm of personal finance. We’re taught from a young age that we should get presents for one another at this time of year because our families raised us! They’ve given us so much, so it is now time to return the favor. But by following this logic, we not only needlessly expand our budgets, we do a disservice to those who need our Christmas cheer the most.
So buckle up because this post might just put a damper on your holiday festivities. Then again, it might just be your most joyful season yet.
Once upon a time when we were children, my sister and I couldn’t wait to wake up on Christmas morning, open presents, eat tamales (we lived in New Mexico so this was a perfectly normal Christmas tradition), and spend time with our relatives we didn’t see often enough. We devised a whole system where everyone got the same number of gifts and we opened them one by one, admiring each other’s gifts before opening our own. We’d get toys and games and highly impractical things we would probably use only once. It was perfect.
Yet my parents would often get themselves things like socks, Home Depot gift cards, and other things they needed rather than wanted. As I get older, I find myself wanting to receive more practical things. “I’m down to two pairs of underwear without holes in them. Make it a Christmas present!” or “It’s time to insulate the attic. Make it a Christmas present!” Yet at the same time, I’m lucky to have more disposable income than ever before, so I find myself wanting to give less practical things.
There comes a time when we really do want to give more than we receive, but that doesn’t mean it’s a good idea. We’re driven by the instinct that says “my parents, siblings, and other loved ones made this time of year so special for me when I was young. I must return the favor by buying them the most outlandish thing I can afford.” We could get our mothers shiny necklaces and earrings, our fathers new tech gadgets and fishing equipment, but at the end of the day, they won’t be any better off or happier for the effort.
And it’s equally crushing when we know we got them the wrong thing, or when the holidays just devolve into handing gift cards back and forth. Not only are these costly mistakes, they take an emotional toll as well, so we resolve to do better next year, only setting ourselves up for failure again.
So let’s take a step back for a moment. Since we’re no longer children begging to open our gifts, we need to find a different way to experience joy this season. I suggest some new gift-giving traditions in four simple steps, based solidly in Monte Largo’s core values.
- Time is Our Most Valuable Asset
What our families really want is to spend time with us. Whether it means saving vacation days to make the trip to see them, or saving the money to fly them out to us, our first priority should not be to buy gifts, but rather to attend, in person, the holiday festivities.
I understand that many people work during the holidays, and for them, a trip at a different time of year might be better. The wonderful thing about the time we spend together is that it’s blind to changing seasons. Saving money or vacation days takes effort, but if it’s truly the thought that counts, giving our families the gift of our time is most thoughtful thing we can do, regardless of the time of year.
- Happiness is the Most Enviable Luxury
Children should get physical gifts, if possible (but no iPhones for Pete’s sake). They will be overjoyed at opening the presents and we can gain joy from watching them play, learn, and grow. However, we adults don’t need one more video game to make us happy, so we should focus instead on reminding one another to be thankful for what we do have.
After we’ve found a way to be with loved ones and bought gifts for children, we may still have budgets for presents. If so, I recommend that every dollar go to charity. Give money in others’ names and write them nice letters or cards explaining the purpose of the charity, why you find the cause important, and have a conversation with them about it. This act will both bring joy to those who truly need it, and bring you closer to your loved ones through discussing your values and beliefs.
- Wealth is a Choice
Not only will every dollar we spend in donations help those in need, but some of that money will come right back to us in the way of tax credits come April. While minimizing taxes should never be a primary purpose of charitable giving, it is a nice side effect that raises everyone’s spirits during the holiday season and beyond.
- Independence is Built on Education
This is easily the most difficult part of the process, but undoubtedly the most rewarding. We must educate those around us to do the same. There are some families where the thought of fewer presents might sound like heresy, or where some people continue to insist on giving traditional gifts, secretly bitter that they receive only donations in return. But I believe we can create a fundamental shift in the way this country experiences the holidays if we try. Less chaos on Black Friday, more time spent with family on Thanksgiving weekend. Fewer toys filling landfills, more joy filling hearts. Less money given to companies that give us what we want, more money given to charities that give others what they need.
I must admit, I haven’t fully implemented these ideas in my own life yet. This year my husband and I are giving a combination of charity donations and real gifts to our families, but every year we inch closer and closer to asking for less and giving less in return (except to those who need it, of course). Perhaps next year we’ll be better about only giving donations and accepting them in return. I suppose trying to be better next year is what New Year’s resolutions are all about.
If you don’t know where to best spend your charity dollars, we highly recommend The Life You Can Save and GiveWell as starting points. These organizations highlight charities that spend their money most effectively to help the most desperate causes. Happy Holidays!
Nathan is the CEO of Monte Largo Financial Advisors LLC.