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Can I afford gifts for 14 grandchildren on my Social Security budget?


Dear Penny,

I am 69 years old, but I am at a loss for birthday and Christmas presents for my wonderful offspring of four children and 14 grandchildren. Two of my grandchildren are married and three of my children have a spouse or partner.

We are on social security. What am I doing? I’ve been giving gifts all my life, but now I’m not sure if my husband dies first and I’m left with less social security. How should I proceed?


Dear V.,

Social Security’s cost-of-living adjustment barely keeps up with price increases each year. They certainly don’t leave room to stretch your gift budget with each new addition to an already large family.

I’m sure your children and grandchildren have appreciated your generosity over the years. But when you’re buying gifts for nearly two dozen people twice a year, those costs add up quickly. Even if you only spend $15 or $20 on each gift, it’s a real strain when you’re living on a fixed income. Meanwhile, the benefit to each recipient is relatively small. I don’t think your family would want such gifts coming if they knew the price was your long-term security.

You and your husband should have a heart-to-heart with your children. Tell them you’re worried about money. Say that you will not be able to continue giving gifts the way you did before. Since you seem to have a loving family, I think they will appreciate your honesty.

It’s not just the anticipation of upcoming birthdays and holidays. It is often embarrassing for adult children talk to your parents about your finances. But these conversations must be held. It is better to start a conversation about money when the crisis is not yet looming. This is especially important if you think you may need your children to help you when you get older.

Going forward, your approach to giving should be determined by what you can afford, not what you’ve done in the past, the number of people in your family, or anyone else’s expectations. Make monthly budget which includes a position for gifts, provided you can afford them. I recommend opening a bank account where you will keep the money intended for gifts. This will help you give only what you can afford.

If you can’t afford anything, that’s okay. Taking care of your own needs is a top priority. That in itself is a pretty big problem at a time when inflation is at a 40-year high.

If you have room in your budget for gifts, you can focus on those occasions that don’t happen every year. Maybe that means limiting gifts to special occasions like graduations, weddings, and birthdays.

For holidays like Christmas, maybe you can start a new tradition. You can offer to have a Secret Santa gift exchange where each person draws a name and buys something just for that person. This could include a dollar limit so no one feels forced to overspend. If everyone in your family makes it a point to buy gifts for each person, it will surely bring much-needed relief to everyone. Even if you don’t have a fixed income, buying gifts for extended family and their partners can strain your budget.

Also, consider how you can celebrate your loved one without spending a lot of money. A phone call, a thoughtful handwritten card, or a home-cooked meal are all much more meaningful than sending something mundane like a gift card. If you have extra time, it can be more valuable to busy family members than a gift that requires money. You can volunteer to babysit pets when a loved one goes out of town, or babysit when the family has young children.

This is an incredibly common dilemma for retirees with growing families. Even in normal times, senior government officials often lack room for hesitation. But as costs continue to skyrocket, many people will need to adjust the amount they can afford.

For all readers who are not struggling financially, one of the best things you can do is to take the initiative here. If others in your life are going through a tough time, offer to forgo the gifts and spend time together the next time a big holiday is coming up. Or tell your loved ones that you don’t want birthday presents. Making it clear that you have no expectations can be a great relief to the one you love.

Robin Hartill is a certified financial planner and senior writer at The Penny Hoarder. Send your tricky money questions to [email protected].

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