Holiday spending patterns this year show clear shifts in how both teens and adults approach the season, and financial counselor Gregory Barnhart of First Command says the biggest theme is one that returns every year: overspending.
In his view, families often enter the holidays with solid intentions but underestimate the many small expenses that accumulate around the celebrations. “The holidays are a great time to show those around you how much they mean to you,” he said, adding that the satisfaction of gift giving can overshadow the less visible costs that pile up throughout December.
He noted that families tend to focus heavily on the gift budget while overlooking the increase in seasonal food purchases, extra travel, or the added fuel and entertainment spending that comes from having more unstructured time. I agree completely. Those supporting costs, not the gifts themselves, are often what push people over budget. Gift spending feels planned out and contained, while the daily extras feel spontaneous and harmless. By the time January arrives, people are often surprised by the total.
Barnhart says the most important step for families trying to stay within a budget is to plan ahead in a meaningful way. “Take some time and think about your holiday plans,” he said. He encourages families to consider how their schedules will change, how much free time they will have, and what they hope to do with that time. The holiday break often leads to more social activities for teens and more hosting responsibilities for adults. These changes affect spending long before the actual gift exchange happens.
In my own experience, people struggle less with creating a budget and more with connecting that budget to a clear purpose. When a budget is just a list of numbers, it is easy to adjust it on the fly. When it is tied to long-term goals, it becomes something worth protecting. Barnhart echoed that idea, explaining that many families unintentionally negotiate against their own financial plans because the goals behind the budget are not well defined. He said that families who know their priorities for the new year are better able to stay disciplined in December.
For teens who are just beginning to earn money, responsible holiday spending starts with defining what responsibility means. Barnhart said that the foundation should be spending less than one earns. He added that teens vary widely in their goals. For some, responsibility simply means not running out of money. For others, it means avoiding debt or protecting savings earmarked for a car or college.
I think this is an important distinction because teens often receive conflicting messages about spending. They want to be generous, but they also need to understand that every dollar spent now is one they will not have for future goals. Helping teens reflect on what they want financially in the next few years can shape healthier habits. Barnhart encourages teens to understand where they are, what they want to accomplish, and how their holiday spending fits into that bigger picture.
Adults face a different set of difficulties during the holidays. Barnhart said that one of the most common mistakes is adding last minute gifts that were never part of the plan. He sees this often, along with buying additional items to keep gift giving balanced among family members. He also pointed to what he called hidden overspending. Small, frequent purchases during the break can accumulate quickly, especially when routines are disrupted.
I think many families underestimate how much routine protects their budget. When daily patterns change, spending opportunities multiply. Even something as simple as extra errands or several small outings can create a meaningful impact. Barnhart also warned about what he referred to as delayed overspending, where credit cards are used to fill budget gaps and the consequences do not appear until interest begins to accumulate in the new year.
When asked whether it is ever smart to use credit for holiday purchases, Barnhart said that credit itself is not the problem. He pointed out that cards offering rewards or cash back can provide value when used responsibly. The key, he said, is to know your cash flow and be certain the balance can be paid in full before interest applies. If not, the seasonal purchase can turn into a long-lasting burden. I agree with this perspective.
Credit can be a useful tool when the user understands the terms and has the discipline to follow a plan. The trouble comes when people use credit as a substitute for savings, because that often leads to interest charges that wipe out any short term benefit.
As for avoiding post holiday debt, Barnhart emphasizes habits that extend beyond the season. He encourages families to put money aside whenever income arrives, limit spending to what remains, and avoid high interest debt whenever possible. I share that view. The best way to prevent financial stress in January is to make decisions in December that honor long term goals.
This year’s trends make it clear that people want meaningful celebrations, but many underestimate the true cost of the season. Those who take time to plan, stay aware of their spending, and stay focused on their priorities are more likely to enter the new year with confidence rather than regret.
