After almost a year of not having to think about money, it is time again. I am not talking about tax season. No, I’m talking about Xmas. The consumerist rat race where you buy presents for people you hardly know and thereby force them to reciprocate and give you something in return. The retail sector loves it and with tight profit margins many of them do not actually turn a profit in the last month of the year. I am not sure this is from misunderstanding accrual accounting or it is really true: One could argue that any business with a net profit margin less than 1/12 does not turn a profit until December.

Anyway, I have fought this forced exchange with some success over the years and thus made it slightly less stressful. My problem is that nobody is better qualified to know what I need than me. Also, nobody is better qualified to pay for it. Therefore, if I need or even want something bad enough, chances are (100%) that I already have it. This means that gift exchanges are a net negative for me. It would be more efficient if we all just bought things for ourselves than things for others. Verily, Xmas seems to be an excuse for inefficient purchasing which is, of course, what shopping is all about. Oh well.

Fear not young rational, below I have collected some suggestions, which have worked with more or less success, that should alleviate some of the senselessness of Xmas. So here we go…

The cynical accountant’s xmas:

  • Instead of buying presents write down the price of the gifts you intend to give each other on a ledger and then subtract the amounts. Then write checks for the net amount dependent on what you owe. I keep suggesting this one and it keeps getting turned down

The creative frugality expert’s xmas:

  • Set a limit of $5 per person and see how that works out. Don’t play this game with consumers or all the gifts will be bought at a drugstore.
  • Decide that all gifts have to be bought used.
  • Buy the gifts from people you know (a “homemade sweater”) and give them to other people.

The overstuffed home owner’s xmas:

  • Give the gift of experience. This could be a simple trip. I personally favor an intro-course, like a “6 hours of sailing for beginners” introduction. Many clubs will offer a deal like this. Be very careful about the recipient though as this could easily backfire. Even if the person seems interested it does not mean that they are willing to commit or even have the time.
  • Food is also a good idea. For instance, I love capsicum (the “hot” in hot sauce), so a few years ago I got various bottles from several people. I have more than 10 bottles and the lasted almost half a year πŸ˜€ Giving something exotic might not be a good idea; I’m thinking of those “make your own somethingyouveneverheardabout/somethingthattakesforevertomake” kits. These might just sit in the pantry until they expire.

The busy/stressed out person’s xmas:

  • Give the gift of time. How about lawn service for a year?
  • Give the gift of agreeing not to give gifts. Not everybody likes to participate in gift exchanges, especially those who are no longer teenagers.

The lazy person’s xmas:

  • Toothbrushes and toothpaste. Many years ago, I kept telling everyone “Toothbrushes” as a first defense. It worked, and as a result I ended up with enough toothbrushes to last me almost a decade. I never had to think about toothbrushes. Just don’t give someone a truckload of toilet paper. And don’t give your wife 5 gallons of dish detergent as she will not be able to appreciate the imminent and sophisticated rationality behind such a gift πŸ˜‰
  • Socks, underwear, standardized jeans, etc. also works this way.

There are also things you should stay clear off.

  • Gift cards! In this environment any gift card better be issued from a financially strong company. If they fold and go bankrupt before your gift card is used, the gift card is worthless. Cash is king!
  • Treasury bonds. See above.
  • Lottery tickets, at least for the financially or statistically savvy. Fun fact: According to the BLS, people who earn less than $13000 annually spend almost 10% of their income on lottery tickets. Talk about regressive taxes!!
  • Gifts that require a buy-in. For instance, a shaving kit which requires frequent replacement of expensive blades.
  • Any kind of pet. See above.

I’d be interested in hearing other ideas! Post comments below.

Originally posted 2008-11-29 11:38:53.