Can’t figure out what to buy your spouse for his or her upcoming birthday?

If you were hoping this article would have the answer: Sorry! It’s hard to know what they want without asking! But what this article CAN do, however, is save you some money as you buy a gift.

Step one: THINK. Before you go to the malls, catalogues, or online marketplaces, stop for a moment. Think of the best presents you’ve ever received, and what made them special. More than likely, they weren’t the biggest, priciest, trendiest, fastest, or greatest gifts. They were memorable simply because they were the most thoughtful.

But thinking – being thoughtful about gift-giving – isn’t just a nice, caring thing to do. It’s also a financially smart way to deal with a celebration or holiday. Thoughtfulness can actually save you money.  

Consider this: Retailers don’t want you to do a lot of thinking about what to buy. They want their wares and displays to do the thinking for you. Why else do we go shopping and so often end up with all sorts of things we never gave a thought to purchasing before? 

So how can you put more thoughtfulness into your holiday giving and keep more money in your pockets?  Here are some ideas to think about:

  1. Avoid last minute shopping
    And miss out on those amazing sales, you say? The reality is that those last-gasp sales often make us buy more than we would otherwise, so we don’t necessarily come out ahead. Plus last-minute shopping is the epitome of thoughtlessness. The object – to get whatever will work as quickly as possible – usually obscures the intent to be mindful about price and quality.
  2. Shop with a budget. 

Being thoughtful about someone else’s needs and wants while focusing on your own finances seems like an oxymoron. At the same time, one of the surest ways to sour your generosity and good will toward others is to be financially stressed.  It’s hard to think of anyone else when the pain of overspending and credit card interest gets too great. An item that is both affordable and meaningful is the perfect recipe for a successful celebration, for both giver and receiver.

3. Remember, the best gifts don’t always come in boxes. 

For children especially – often overwhelmed with quantities of “stuff” at the holidays – consider giving an “experience.” Dress up and go to tea at a special place, go on a camping trip, visit a new museum, take in a play: All can be a special memory that will last long after the usual toys or clothes are forgotten, broken, handed down, or given away. And none of these experiences need be particularly expensive to count as a great gift.

4. Consider giving a gift that’s priceless.

Money can buy just about anything, with one important exception: It cannot buy time. This makes time arguably one of the most precious gifts in the world – but also affordable to anyone willing to give it. You can give time to a loved one in all sorts of creative ways: babysitting, housework, planting a garden, taking over a regular task. Make it fun by designing a coupon book with redeemable tokens for what you are offering, letting the recipient chose the time that works best for him or her.

My final financially smart gift idea is one that people may consider the complete antithesis to thoughtfulness: Namely, the gift of money. In fact, so seemingly impersonal and cold is a gift of cash, that it is now customary to buy a gift card instead. However, as a CFP, my quarrel with gift cards is that there can be a significant gap between the money put onto the card and the value that the recipient actually gets. The average individual has at least one or two gift cards lying around that have unused balances that are often forgotten about. It’s possible to sell these cards for cash, but not without a sizeable fee that cuts into the proceeds.

The “thoughtfulness” of a money gift comes from the fact that it allows the recipient to think about how to use the cash, and to put it towards items or uses that he values the most. Unlike a gift card, cash is unlikely to be wasted on a shirt from Brook Brothers, when the recipient would rather use the money at the Apple Store. Unless you know the recipient really well, you risk giving a card from a retailer that he or she rarely patronizes. But how many times have we resorted to gift cards precisely because we didn’t know the recipient all that well?

What I really like about giving money is that it makes the recipient think. He must plan how to use it. And whenever a gift gets an individual to do some planning, that in my book is one of the most thoughtful gifts of all.