How to Cope with Holiday Financial Stress Without Losing Your Mind

Halloween just came and went last Friday which means we’re now in November. It also means that we’re entering holiday season.

Holidays are a stressful time of year financially for many people out there. I’m going to provide some numbers to highlight the financial implications of what I mean and then discuss the emotional parts too.The uncertainty around the economy and inflation is adding to that uncertainty this year. A recent survey by Deloitte found that consumers on average plan to spend $1,595 this holiday season. That’s a lot of money. That’s a lot of money if you have it and it’s even more money if you don’t.

What do I mean by that? When people don’t have money they often take on debt. A survey by Lending Tree in 2024 found that 36% of Americans took on credit card debt averaging $1,196. If you know anything about credit card debt is that those interest rates can be over 20% in some instances. So, like I said, that’s even more money if you don’t have it.

Let’s take some time to explore what’s really behind the holiday financial stress. I’ll also be providing some practical ways to navigate it emotionally and financially.

The Hidden Emotional Cost of Holiday Spending

You can easily just look at your credit card statement or your bank account and see the amount of money spent for the holidays. The emotional costs of holiday spending are much more difficult to measure. A 2024 survey by the American Institute of Stress found that 70% of Americans experience stress. The top contributing factor? Financial pressure. Many people spend more than they planned because of guilt, comparison, or the desire to show love through gifts.

Money isn’t just about the numbers. It is deeply tied to our identity, self worth, and relationships. Overspending often times leads to shame, anxiety, depression, or resentment that lingers long after the holidays have passed.

5 Practical Ways to Cope with Holiday Financial Stress

1. Set a Holiday Budget (and Share It)

Before buying a single gift, decide how much you can realistically spend, not how much you wish you could. Then clearly communicate that budget to your family, partner and/or friends to help hold you accountable.

• Use a simple spreadsheet or budgeting app (like YNAB or Mint).

• Include all expenses: gifts, travel, meals, decorations.

• Be honest about what’s sustainable for you and your household

If you have clarity and communicate this to those around you not only will it help you continue to be mindful about your costs, but it can also help reduce some of the overwhelm that shows up too.

2. Re-think Gift Giving

Many people show love with spending but thoughtful doesn’t have to mean expensive.
Try:

• Service gifts: (babysitting, cooking dinner, planning a fun day together)

• Group gifts for family or friends

• Spending caps or “Secret Santa” exchanges. During the holidays this is a fun idea for extended family if you are all into gift giving.

These small shifts can help you maintain or even deepen connection without financial strain.

3. Watch for Emotional Spending Triggers

If you notice yourself buying impulsively online at night or during stressful moments, pause and ask:

“What purpose is this purchase serving?”

Often, emotional spending is an attempt to manage stress, guilt, or comparison. Instead, try simple grounding techniques such as deep breathing, journaling, or even a short walk. Step away from the screen and let it that purchase sit in the shopping cart before determining whether you buy it or not.

4. Plan for Post-Holiday Recovery

If you do use credit cards, plan ahead for how you’ll repay them.

• Try to eliminate the highest interest credit cards first. That interest compounding against you is so detrimental.

• Consider balance transfers or automated payments to stay on track.

• Reflect on what worked and what didn’t so you can plan differently next year.

5. Focus on What Matters Most

The holidays are about connection, not consumption. Build in moments that cost nothing but mean everything create family traditions, have a movie nights, spend time with loved ones, or simply rest.

If financial stress feels overwhelming, it might help to talk with a financial therapist (like me!) who can help you explore the emotional side of money and set goals aligned with your values.

Key Takeaway

Holiday financial stress is real but it doesn’t have to overwhelm you. Setting realistic budgets, communicating boundaries, and staying mindful of your emotions and what triggers you can protect your mental health and your bank account too this season.