How Much to Spend on Birthdays

Creating a budget for all the birthdays in your life can be hard. There are so many questions – Do we need to buy them a gift? Did they get us a gift? How much should we spend? Should we spend the same on everyone?

It can get complicated, but I want to share with you a simple rule we live by that has helped us a lot! We have classified everyone in our family and our close friends into groups. Each group has a specific budget to use. If someone is in the group then that’s how much we spend on them.

The reason we created this budget system for birthdays was to make sure everything was equal. It was important to us to make sure we treated my family the same as we treated my husband’s family. Now before I get into it, I do want to have a disclaimer:

This budget idea is a just a suggestion. It may not work the exact same for your family as it does for ours – and that’s okay. You also need to have the wisdom to know it’s okay to spend more or less for a specific person. For a big birthday then we might spend a bit more than usual. If we find a really good deal then we spend less. For instance a few years ago J and I (along with my sister-in-law and brother-in-law) spent more for J’s Dad. We bought NASCAR tickets for him and at the same time we bought a ticket for J so he could go with him. That was an exception to our budget rule. We saved more money and gave ourselves permission to spend more, and it was awesome. Now we don’t splurge on everyone, which is why we get to do it every once in awhile.

Again, these are just guidelines for your budget. You can spend less or you can spend more depending on the space you have in your budget.

Spouse – $30 each
Children – $30 each
Parents – $25 each
Siblings – $20 each
Nieces and Nephews – $15 each
Friends – $15 each
Children’s Friends – $15 each
Others – $10 each

A great way to be prepared for birthdays is to treat them as a sinking fund. Make a list of everyone you buy gifts for, how much you budget to spend and then add it up. Take that total and divide by 12. That’s how much you need to be putting back each month to afford birthday gifts.

For example, let’s say you have 15 people you need to buy for through out the year. This includes spouse, kids, parents, sisters, nephews and nieces, coworkers, friends, and birthday parties that your kids will go to. You take the amount for each category, let’s say equals $350 for the year. You would divide $350 by 12 months to get about $30.00. You need to be saving $30.00 each month into a separate account or earmark it in your checking so you can buy gifts.

Here’s what our family’s birthday budget looks like:

We spend about $475 a year on birthday gifts. This means we save $39.60 each month to cover everyone’s birthday. Now our family is kind of big. J has 2 brothers and a sister while I have one sister. They are all married (or in serious relationships) and some have kids. We have also come to an agreement to skip buying larger gifts for each other. We might spend $10 on one another so we can have a little more wiggle room in our birthday budget.

Again, I want to be fully honest here. If I can find a great gift for less than my budget then I call that a win. I don’t have to spend my budgeted amount. I just try not to spend more than my budget.

We even use these budget amounts for Christmas gifts, too. I have a great way to help with our Christmas budget and I plan on doing it again this year. It has really streamlined everything.