The holiday season is a time for celebration, togetherness, and spreading love and joy. It’s also a time when many people feel pressure to spend more than they can afford. Holidays like Thanksgiving, Black Friday and Christmas, occur back to back, and money seems to vanish. Black women and women of color often find themselves at the intersection of cultural expectations, familial responsibilities, and financial limitations. Especially if you’re the eldest daughter of Black or brown household, or from an immigrant household. With that being said, setting boundaries with loved ones about your finances during the holidays is a crucial step in maintaining your financial well-being and mental health. 

21Ninety chatted with Maria Melchor, Founder and CEO of FirstGenLiving and content creator behind @FirstGenLiving on Instagram and TikTok to explore practical ways to communicate and establish financial boundaries with your loved ones this holiday season.

Self-Reflection and Financial Awareness

Before you start setting boundaries, it’s essential to have a clear understanding of your financial situation. Take some time to assess your current financial status, set a budget, and establish your priorities for the holiday season. Consider your income, expenses, and any financial goals you may have. This self-awareness will provide you with a solid foundation for discussing your financial boundaries.

“Create a holiday spending budget for yourself, but don’t expect your loved ones to do the same,” explained Melchor. “The only finances within your control are yours! Based on your current finances, can you afford to spend $100 or $1,000 on loved ones this holiday season? If your budget is closer to $100, then before you start shopping, keep in mind that you can only afford gifts in the $20 range per loved one. If your budget is closer to $1,000, you can afford to spend in the $200 range per loved one.”

Understanding your financial situation is crucial for making informed decisions. Consider your monthly income, regular expenses (rent or mortgage, utilities, groceries, transportation, etc.), and any debt obligations. Additionally, factor in any savings goals or investments you’re working towards. Having a comprehensive view of your finances will help you make realistic choices during the holiday season.

Open and Honest Communication

Clear and open communication is key when it comes to discussing your financial boundaries with loved ones. Approach the conversation with empathy, understanding, and a non-judgmental attitude. Let your family and friends know that you value them and want to be part of the festivities, but you have limits to your spending.

When talking about financial boundaries, choose a comfortable and private setting. It’s crucial to convey your message in a non-confrontational manner. Use “I” statements to express your feelings and needs. For example, “I feel overwhelmed by the financial pressure during the holidays, and I need to set some boundaries to protect my financial well-being.”

Set Realistic Expectations

Setting realistic expectations is crucial in preventing misunderstandings and disappointments. Let your loved ones know in advance what you can and cannot afford. If you’re not able to buy expensive gifts or contribute to every gathering, it’s important to be honest about it. Suggest alternative ways to celebrate together that are within your budget.

Honesty is the foundation of setting realistic expectations. Explain to your loved ones that you have financial limitations, and you want to ensure that you make choices that align with your financial goals and stability. It’s an opportunity to educate them on the importance of responsible financial decision-making.

Prioritize Self-Care

It’s essential to prioritize your own financial well-being and mental health. Remember that it’s okay to say no and set boundaries that protect your financial stability. Avoid feeling guilty for prioritizing self-care over excessive spending. 

Setting financial boundaries is a form of self-care. It’s about ensuring that you’re not compromising your financial stability for short-term gratification. Communicate with your loved ones that self-care, including financial well-being, is a priority for you, and it benefits everyone in the long run.

Share Your Financial Goals

If you have specific financial goals, such as paying off debt, saving for a home, or building an emergency fund, share these goals with your loved ones. Explaining your financial aspirations can help them understand why you need to set boundaries and make financially responsible choices.

Sharing your financial goals helps your loved ones understand that your boundaries are not a rejection. They’re a commitment to a positive financial future. They may even become your number one cheerleaders, supporting your goals and decisions.

Offer Alternative Ways to Celebrate

Suggest alternative ways to celebrate the holidays that don’t involve extravagant spending. This could include organizing potluck dinners, participating in volunteer activities, or exchanging heartfelt, handmade gifts. These alternatives can create meaningful and memorable experiences while respecting your financial boundaries.

“Avoid putting a dollar sign on your love,” said Melchor. “Brainstorm non-monetary ways to express your love and appreciation. Remember that you can’t quantify love!”

Proposing alternative celebrations allows you to maintain the spirit of togetherness without straining your finances. Encourage your loved ones to get creative and participate in activities that strengthen your bonds without breaking the bank.

Empower Each Other

Encourage your loved ones to also be honest about their financial boundaries and limitations. This dialogue can help create a supportive environment where everyone feels comfortable discussing their financial needs and concerns. By empowering each other, you can collectively work towards a holiday season that aligns with everyone’s financial capacities. This type of communication reduces the pressure to overspend and creates a more inclusive holiday celebration.

 Stick to Your Budget

Once you’ve set your financial boundaries, it’s important to stick to your budget. Avoid the temptation to overspend or make impulsive purchases. Be mindful of your financial limitations and stay focused on your long-term financial goals.

“Exchange wishlists with your loved ones (preferably with items at different price points, kind of like a wedding registry)!,” says Melchor. “This protects both of you from overspending or mis-spending (aka buying things we won’t even use).

Staying disciplined with your budget requires ongoing commitment. Regularly review your spending, track your progress, and make adjustments if necessary. Sticking to your budget will help you maintain financial stability and avoid the stress of holiday debt.

Melchor believes that setting financial boundaries will strengthen relationships with loved ones long term. While setting financial boundaries can be uncomfortable and scary, it’s better than harboring long-term resentment over money. “Money is the leading cause of divorce for a reason,” she says.

In fact, Setting financial boundaries with loved ones during the holiday season is an act of self-love and self-care. It’s important to recognize that your financial well-being is a crucial aspect of your overall health and happiness. All in all, you can celebrate the holidays in a way that honors your financial boundaries while still sharing love and joy with your loved ones. Remember, financial boundaries are not barriers, but rather bridges to a healthier, more sustainable financial future. 

Aysia Morton, a culture and travel writer, wrote this story.