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Talking to Teens About Money

Financial Health for the Holidays

’Tis the season to overspend. We know we shouldn’t spend more than we have; however, we engage in some of our most self-destructive financial behaviors during the holiday season.

During the holidays, Americans will make one-third of their yearly purchases and often spend many months trying to pay off the bills. We pay in other ways too. According to the American Psychological Association, two-thirds of us identify money as the No. 1 stressor in our lives. It is no wonder why. At the end of 2008, the average American household with a credit card carried more than $10,000 in credit card debt.

Giving to others feels great. However, if we are spending more than is reasonable for the holidays we are not only hurting our financial health, we are modeling poor financial behaviors for our children. If you are at risk of spending more money than you can afford this holiday season, consider the following tips:

  1. 1. Begin your holiday shopping by making a different kind of list. List all of your beliefs about giving gifts. Our beliefs about money, called “money scripts,” are those unconscious and often self-limiting money-related beliefs we learn early in life (typically from our own parents) that drive all of our financial behaviors. For example, many who overspend have money scripts like:

    • “Spend it while you got it.”
    • “I’ll never have enough money, so I might as well have fun now.”
    • “My family deserves to have nice things whether we can afford them or not.”
    • “You show your love for others by buying them expensive gifts.”


    These types of money scripts, when left unexamined, can lead to significant overspending during the holidays and other self-destructive financial behaviors throughout the year. Spend some time examining your list of money beliefs and where you might have received these messages. Knowing what your money scripts are and where they come from can help loosen their grip on your life and enable you to make healthy financial choices. Money scripts get passed down from parent to child, so it is important to identify and change any problematic money beliefs we have or they will trickle down to our own children.

  2. 2. Make a commitment to stop buying on credit. Don’t start a new year on the wrong financial foot by growing your debt several hundreds or thousands of dollars this holiday season.

  3. 3. Leave your credit cards at home. People spend up to 30 percent more when they use credit cards to make purchases. There is an emotional distancing that comes with a swipe of the credit card that doesn’t exist when we spend cash.

  4. 4. Make a plan. Determine how much money you can spend before you start shopping. Make a list of people you will give gifts to, and how much you will spend on each. Involve your teenagers in the process of budgeting for gifts for extended family members and friends. Then go to the bank and withdraw that amount of money in cash and put it in envelopes. Remember to use cash to make ALL of your holiday purchases. The skills your teens will learn in budgeting for the holidays are the same skills they will need to manage their money throughout the year.

  5. 5. Get creative. If you have a large family, put names in a hat and have each member draw a name and buy for that person only. Set a price limit and stick to it. You may be surprised how relieved your family members are when they don’t have to buy gifts for everyone. Also, remember that the best gifts come from the heart, and many cost little or no money. Encourage your family members to consider adding two or three items on their wish lists this year that don’t cost money. Toys are easily broken and quickly discarded, while memorable experiences of family time can last forever.

    Whether or not your family is already burdened with excessive debt, set a reasonable spending limit this holiday season to avoid the holiday debt hangover. When the vacation is over, the toys are broken and you open your bills in January, you will be happy you did.