"Christmas is the season when you buy this year's gifts with next year's money."
When I got married, my Christmas shopping got exponentially more complicated. I was used to buying a few presents for my parents and grandparents and calling it a day.
Marriage added a new layer of intricacy. My wife’s parents were divorced and remarried, so there were now in-laws, step-in-laws, new friends, godchildren, and what appeared to be, to me, random people. Maybe I’d met them at the wedding? I wasn’t sure.
What I did know is that Christmas shopping had become a frenzy of shopping, wrapping, and mailing.
OK. I didn’t wrap. My wrapping skills are such that any present I purchase and subsequently wrap makes the present look like it has mange. My wife does the wrapping, thank goodness.
We didn’t even have kids, for crying out loud. I could only imagine how nuts it would have been if kids were in the picture.
For a couple of years, I sat mute on the subject of Christmas shopping. I didn’t want to upset marital harmony or risk ticking off the people we’d only seen a couple of times in our lives yet felt compelled to exchange annual gifts with.
Finally, though, I piped up. As my wife was making her annual list of gift recipients, I started questioning beneficiaries of our generosity.
“Why are we getting Bob and Sue [NOT THEIR REAL NAMES...Bob and Sue, we love you!] a Christmas gift? I’m not sure I could pick them out of a perp lineup.”
“Because they got us a gift last year, and if they send us a gift, I’ll feel bad if we didn’t get them a gift in return.”
And in that one sentence, Dear Reader, we see three reasons why Christmas shopping can snowball out of control.
What Happens When Monkey Brain Goes Christmas Shopping
Inside of all of us, we have a constant battle between two brains. One part of our brain is called the prefrontal cortex. It’s the part of the brain that you normally associate with thinking. It’s refined, elegant, and advanced. When it’s large enough, it makes you The World’s Most Interesting Man (or Woman). The prefrontal cortex separates us from the rest of the animal kingdom. We have one. They don’t. We win the food chain wars because we’re able to plan for the future.
If the prefrontal cortex were completely dominant inside our heads, the world would be great. We’d have no debt. We’d plan for retirement. We’d never stray from our diets. All would be good.
Except, there’s another part of our brain that vies for attention. It’s called the limbic system. It’s the part of the brain that we share with other animals, like our simian counterparts, monkeys.
That’s why I call it Monkey Brain. Monkey Brain is focused on the here and now. He wants pleasure, and he wants it immediately. His currency is man caves and Jimmy Choo shoes. If you’ve ever said that calories on vacation don’t count, then you’ve fallen victim to one of Monkey Brain’s plots.
Monkey Brain LOVES Christmas!
He loves Christmas because he gets presents. Not only does he get presents, but he gets go to SHOPPING!
If you’ve seen The Christmas Story, then you remember the scene where Ralphie and his friends are pressing their noses up against the shop window of Bigbee’s, looking at all of the toys and the Red Ryder BB gun.
That’s Monkey Brain at Christmas. There’s a world of stuff for him to buy and you’re opening up the wallet for him.
Let’s look at why your limbic system derails you so much during Christmas.
Reciprocity is the desire to do unto others as they have done unto you. In Christmas terms, it’s “get a gift, give a gift.” As Robert Cialdini, author of Influence: The Psychology of Persuasion explains, whoever gives first has first mover advantage in a relationship. In other words, if someone gives you a gift, then you feel indebted to that person, like you owe them a solid. What do you do to repay? You give them a gift back.
Of course, Monkey Brain doesn’t like owning favors to anyone. He’d rather keep a stack of favors owed, like The Godfather, which he can call on at most inconvenient times. So, in order for him to curry those favors, he gives gifts first. Thus grows the Christmas list.
Keeping up with the Joneses
Out in the animal kingdom, Monkey Brain shows that he’s a better mate/pack leader/fashion model by puffing himself up, screeching louder than anyone else, and trying to appear bigger and badder than any other monkey so that he gets all of the women.
We have an equivalent set of posturing.
We want people to think that we’re well off, successful, handsome, and doing better than our neighbors. In our own, quiet little unstated competition with the rest of the world, we want to show that we can afford to get others nice gifts for Christmas and that it won’t put a dent in our wallets. Instead of reining in our spending, we buy beyond our means and hope that we can pay it off by the time next Christmas comes around. After all, if our friends can afford to buy us nice things, then we should be able to afford to buy them nice things, right?
Yet, who wants to be the one to admit that the Christmas shopping and buying has gotten out of hand, to be the first one to say “I don’t make enough money to be able to afford this madness?”
That’s not an easy admission to make.
Monkey Brain would rather keep playing the Christmas one-upmanship game than to admit that he can’t afford something. So, we keep participating in the cycle.
Every morning that you wake up, you have a certain number of times that you can say “no” to something before you give in and say yes to something that you don’t want. As Charles Duhigg explains in the book The Power of Habit, it’s why we have a morning routine of getting up, scratching ourselves, brushing our teeth, showering, and the like. We don’t want to waste precious mental resources making decisions about meaningless activities.
OK. Showering isn’t meaningless. I know my friends and family appreciate it when I shower.
Each time you have to make a decision and say no to a temptation, you reduce your ability to say no the next time. This is known as ego depletion, and it’s ego depletion that, in hindsight, causes you to wonder to yourself “now, just why did I buy that [shirt/game/Ferrari], when I know I don’t need one?!?”
When you’re shopping for Christmas presents, you’ve probably heard this little whisper:
MONKEY BRAIN: “ONE FOR MOM. ONE FOR ME. ONE FOR DAD. ONE FOR ME. ONE FOR HONEY. TWO FOR ME.”
In 2012, 71.5% of Millenials who participated in Black Friday shopping bought something for themselves. With all of the sales and great buying opportunities, who could resist, right?
With all of these tools Monkey Brain has in his arsenal to make sure that you go crazy during the Christmas season, it’s no wonder that 45% of people who made a Christmas budget exceeded it. Only part of you wants to not go crazy during Christmas. The rest of you is howling in his cage throwing bananas every time you walk away from something BECAUSE ZOMG IT’S ON SALE!!!!
How in the world do we tame down the craziness that can be Christmas shopping and the hamstringing it can put on our financial lives?
How to Stuff Monkey Brain in a Sleigh
Sure, sure, I could tell you to get on a budget for Christmas, but what good is a budget if you’re going to be like half of the people who make a Christmas budget and blow right throw it as if you’d never made one?
Remember, personal finance is about behavior. Sure, math is required, but the math doesn’t matter if you never do anything with that math.
Be brave and start the conversation
It’s tough to be the one to admit that spending is out of control. Ask any politician. But, you’re not the only one amongst your friends and family who is thinking it. Everyone is. Do you really enjoy trying to figure out just the perfect, useful gift for that distant cousin who already has it all and who is going to get you a Sham-Wow for Christmas? Probably not. It’s an inefficient use of money; if we just eliminated the exchange of useless gifts, we could pay off the entire amount of student loan debt in the United States.
But, someone has to do it, or the cycle will continue.
Be proactive, particularly BEFORE Black Friday and Cyber Monday/Tuesday/Wednesday/Thursday/Friday/Saturday/Sunday starts. Call those people who were on the list last year. E-mail them. It doesn’t matter. But, start the conversation.
“Bob and Sue – you know that we treasure your friendship, but we wanted to get ahead of the train this year for Christmas. We think that there are better ways to express our care and love for you than exchanging Christmas presents, and we hope that you will join us. This year, instead of doing Christmas presents, we’d love to [have you over for dinner/go play Putt-Putt/go for a hike/count mullets at the mall]. What do you think?”
That’s what we did, and we were pleasantly surprised at the number of people who responded back (nearly all of them) positively and expressed relief and gratitude that someone was stopping the madness.
Be that person.
Give time, not money
Money is not the only scarce resource we own. Time is also a scarce resource. Therefore, as Adam Grant, author of Give and Take: A Revolutionary Approach to Success explains, when we give time, we feel like we have more time, and we feel richer. Furthermore, because we’re giving our time, we’re increasing our social bonds with the people to whom we give that time.
This means that if you intentionally give a present of time to someone, you’ll deepen your relationship with that person. This can be particularly meaningful for older recipients, as, in general, the older you get, the more aware of the fleeting nature of time you become.
Create memories, not closets full of unused regifting candidates.
For the people for whom you buy gifts, stick to small budgets
Remember, gifts are tokens of our appreciation and love. They are not actual appreciation and love. So, when you see that gift that you tell yourself is PERFECT for whomever, don’t use that as a justification to buy it if it’s out of your price range. Furthermore, the amount of money you spend on someone is not a measure of just how important you are to them or they are to you. The effort you put into a relationship the other 364 days out of the year measures meaning, not a present.
Therefore, try to buy small, fun, meaningful presents that are representative of the relationship, not representative of how fat your wallet is.
After all, the more you save now, the quicker you can get to retirement, and the more time you can spend with those people doing fun things!
How are you reining in Christmas spending? Have you ever had to start the “we’re spending too much at Christmas” conversation? How did it go? Let’s talk about it in the comments below!
Jason Hull is a candidate for the CFP(R) Board's certification, is a Series 65 securities license holder, and owns Hull Financial Planning. He is also a personal finance columnist for U.S. News & World Report.
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