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Will the 4 Gift Rule Work for Your Family this Christmas?

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The 4 gift rule helps you stay on budget while still getting your kids what they want. See how the four gift rule can help make shopping easier for you.

Every Christmas parents struggle with what to get their kids for Christmas. It can be a challenge to find or often, afford the ‘perfect’ gift. It can also be easy to lose sight of your budget when you’re out shopping and come home with considerably more than your kids need. I like to use the 4 gift rule for Christmas as a way to guide my shopping and save money. Whether you’re on a budget or just trying to discourage materialism in your family this holiday season, you might want to consider the four gift rule this Christmas.

The 4 gift rule has been circling the Internet the past few years. I do not know the origin but there are a few variations of it. The idea is that you buy your children no more than four gifts for Christmas, to help simplify shopping and not overwhelm your children.

what is The 4 Gift Rule?

 

The four gift rule sounds difficult. It’s not. It makes shopping simple, and can keep you from overspending. Here’s how the 4 gift rule for Christmas works:

1. You buy something they want

2. You buy something they need

3. You buy them something to wear

4. You buy them something to read

My husband and I have gone back and forth trying to decide if we are going to follow the 4 gift rule or just put money in their investment accounts instead.

I know we are just a few days away from Christmas, but we still haven’t decided what we’re doing yet. (Thank God for Amazon two day shipping amiright?)

If you like shopping on Amazon (or other stores for that matter), make sure to use shopping portals like Ibotta or Swagbucks to get cash back (up to 10% in some categories) plus a free $10 just to start.

It’s easy for us to have a small and frugal Christmas because our children are very young, and they won’t remember anything. They can’t even rip presents open, although they are extremely adept at trying to eat any kind of paper they can get their hands on.

We’ve opted to wrap a few gifts they’ve received from friends and family. They recently got baptized and a few people sent them gifts for that, which we just put under the tree.

One thing to add is that if you are considering the 4 gift rule for older kids this Christmas, you may encounter some disappointment, especially if they are used to getting more presents at Christmas or have friends who will be getting far more gifts than four under the tree.

Use it as an opportunity to encourage thankfulness and help them understand the importance of living on a budget.

Help them see that you are still giving them something (up to four somethings in fact) and are being responsible with your money so that you can help them later in life – like helping pay for college or a car or something else that they will appreciate much more when the time comes than more junk now that they’d just end up giving or throwing away.

The beauty of the four gift rule for Christmas is that you can modify it to fit your family. Gifts can get expensive, especially with older children; so, if you have multiple older children don’t feel bad buying just two gifts instead of four to fit your overall spending within your budget.

With that said, here are some examples of Christmas gift ideas for kids using the 4 gift rule.

4 gift rule ideas for kids

 

If you’ve always bought a lot of Christmas gifts for your children, it may be difficult to narrow down what to buy. Below are four gift rule ideas for kids you can use for your family.

For Infants:

 

1. Something they want: A nice, wooden toy

2. Something they need: Put money in their investment accounts. Ally Invest is a great option if you don’t already have an account. Ally Invest offers custodial accounts and the lowest price in the industry – $4.95 per trade, with no minimum balance requirement.

3. Something to wear: A puppet or socks since they have so. many. clothes.

4. Something to read: Any book that has something interactive in it. My son could watch me open and shut the little windows on Brown Bear, Brown Bear all day long.

For Toddlers:

 

1. Something they want: A play kitchen to use in their play room

2. Something they need: A new coat and gloves or a big kid bed

3. Something to wear: Dress up clothes

4. Something to read: Something inspirational or memorable.

**Related – check out Amazon’s 12 Days of Deals for deals on gifts for your family!**

For Older Children

 

1. Something they want: A new bike to ride around your neighborhood.

2. Something they need: The musical instrument they’ve been practicing in school.

3. Something to wear: The sneakers everyone has but you swore you wouldn’t buy.

4. Something to read: An entire series they can enjoy during their winter break.

The 4 gift rule helps you stay on budget while still getting your kids what they want. See how the four gift rule can help make shopping easier for you.

For Teenagers

 

1. Something they want: A cell phone so they can talk with their friends.

2. Something they need: A tablet or laptop for school.

3. Something to wear: A gift card to their favorite clothing store

4. Something to read: A new series, a magazine subscription (Amazon has some good ones to select) or something that has to do with their career aspirations.

If all else fails for a teenager, you can also buy them an American Express gift card to use on something they want to get themselves.

You can also get them an experience through Living Social if you’d rather get them something and not just cash.

Benefits of using the 4 gift rule for christmas

 

The main benefit of using the four gift rule for Christmas is it makes shopping much simpler, especially if you have a larger family. We find that having different categories to direct our shopping helps us buy items kids can actually use and enjoy.

Another benefit of using the 4 gift rule is it makes receiving presents much simpler for the child. If you have grandparents, and other family members who buy them presents it’s easy for your children to get overwhelmed with presents. By utilizing a system like the four gift rule you cut down on the presents, letting your child enjoy each present more.

The final benefit of the rule is straightforward – it can save you money in certain circumstances. Having a budget for holiday spending is great, but the 4 gift rule gives it a little more meat to help keep your spending in check. If you don’t have either it can be easy to overspend and end up carrying debt into the new year.

Bottom line

 

I’m starting to notice that kids get more expensive as they get older. However, you’ll notice that outside of these four gifts, there’s really not much else you would get your children.

The four gift rule really cover all the bases, and they can limit you from going over the top.

The best part is that the 4 gift rule for Christmas still allows for some nice splurges except they are concentrated in just one or two items. You can also do the bulk of your shopping on Amazon. If you’re like me and love to shop on Amazon, check out our guide on ways to save money on Amazon this Christmas to save even more money.

Please remember the above suggestions are merely options. You can customize the 4 gift rule to your budgetary needs and particular situation.

 

Would the 4 gift rule work for your family? Would your children revolt if you instituted the four gift rule this Christmas? Do you have a method you follow to stay within budget on your holiday spending?

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Catherine Alford is the go to personal finance expert for parents who want to better their finances and take on a more active financial role in their families.

48 Comments

  • Vanessa D. says:

    When my boys were small they received far too much at Christmas. Their other Gramma spent a wad every Christmas, so our house tended to look as if the Wal-mart toy section had vomited everywhere by the time it was finally over. It was absolutely ridiculous.
    The first year I was separated from their father was easy – we split the cost of buying them each a Gameboy and that was their main gift with a few filler items purchase separately.
    After that it was hard. My tree always looked naked to me, as if there were hardly anything there but I stuck to my guns and kept reminding myself that they would get an entire second Christmas with their dad and how many other people would be buying them gifts.
    Now I have a 23 and 19 year old who are truly appreciative of the things they receive. They each get 2 pairs of pajama pants, some boxers and socks along with a stocking of their favorite toiletries and a chocolate orange. Then there is usually something nice that they need or really want, even if that happens to be a gift card so they can choose their own clothing and that is it.

  • I never heard of the 4 gift rule.

    When I was growing up, my paternal grandfather gave the grandkids money for Christmas, but I didn’t know he did this until I was a teen. My parents would take the gift every year and invest it into a mutual fund for college.

    Looking back, this was the best gift of all. When we have kids, I want to make it a point to give them a gift of money into a mutual fund/ETF to help them learn about and understand money. Of course, I will still get them some fun stuff to open, but the lesson of good personal finance is more important.

  • Robin says:

    It is exactly what we are doing this year. our daughter is three, and I want to get her started early so she doesn’t expect a thousand presents each Christmas.

  • I think this could work for us. There is a lot of wiggle room with the 4 gift rule. We set a budget amount per child and stick to it.

  • My kids are getting more than four gifts this year. Not a whole lot more, but definitely more than four. I think that’s a great strategy, though. Many kids in this country have everything they could ever want and more- there’s no reason to buy kids more than they could ever wear or play with.

  • Mrs. Maroon says:

    We found this idea a couple weeks ago and loved it. We were instantly on-board. We’ve been working hard all year to focus on the fact that stuff (read: junk, crap, or any other choice four-letter word) is not important. So this seemed perfect for Christmas. Past history has told us that our families like to go overboard, so we asked them to do the same. We got a WEE bit of resistance. My favorite was “it’s my money and I’ll spend it however I want!” Mini Maroon #1 is almost three. We feel like this is our critical year to set the expectations for Christmas many years down the road. I’m very anxious to see how everyone follows the requests. It’s almost here…

  • Yea our little one is still at the age where he doesn’t really care what he gets…he’s much happier playing with plastic containers. So I’ll enjoy this time for now. I’ve never heard of the 4 gift rule…what happens if other people get them presents?

    • The Roamer says:

      It still keeps the count down even if other people get them gifts.

      I think the 4 rule is a nice baseline but I was pretty disappointed with the examples. It started off good at the young ages but as they got older things got out of control.

      The statement kids get more expensive as they get older is just false. The sneaker example was also troubling. Do your values go out the window on Christmas? If you swore to never buy them I assume it for a reason. Like a brand name product who’s cost is all tied up in a name and who’s value isn’t reflected in the price. These sneakers aren’t a better idea or a good purchase just because it’s Christmas.

      It really seemed like all the last examples where things the kids wanted as appose to just meeting needs.

      Again just an good rule of thumb to consider but you still have to keep yourself in check I’m sure its still possible to spend over $500 on 4 items if you don’t stay aware of the over all message

      • Cat says:

        Ah you know, they were just examples. And no, values don’t go out the window at Christmas. Again, just an example. I think it’d be fun to surprise your kid with a gift you swore you wouldn’t buy – something you said no to all year but were secretly saving up for the whole time – that sort of thing.

      • Sarah texidor says:

        I agree. This year we are giving one gift from each member to one another to show our love and thotful ness. We have 3 kids so each kid will get 5 presents in our family each are getting new bedding to keep warm. And 4 items that each of us have picked. Nothing over 30 dallers.

    • Cat says:

      Ah you can’t stop grandparents from going cray cray. That’s why it’s just not really worth it to buy so many things yourself etc. 😉

  • Money Beagle says:

    I like this one a lot. I might have to tag this for future years as I think it could apply for many different people and exchanges. Thanks for the idea!

  • I love this! I’d never heard it before. We’re pretty much set this year, but this is an excellent guideline I may use for next year.

  • Kim says:

    I’ve never heard of the 4 gift rule, but I like it. Our daughter has more than 4 gifts this year, but all the stuff she asked for was cheap. I’m sure that will change as she gets older.

  • Cool idea! I think this would work for me. Personally, I don’t like giving expensive gifts because I think children grew out of toys very fast. So 4 gifts would not cost that much..

    • Cat says:

      Oh yeah. I mean yesterday my son played with an empty toilet paper roll all day so there you go. 😉

      • Cassidy Kae says:

        My girls are 4, and last year, they got 5, plus a few stocking stuffers. Do you guys think that’s enough?

        • John Schmoll says:

          I think that’s definitely enough Cassidy. We have a 9, 7 & 4 year old and we’re in the 4-6 gift range, along with a stocking stuffer or two. Not knowing your situation of course, but when you begin to add in some gifts from grandparents/other family members the gift total can really begin to add up.

  • That 4-gift rule is really helpful. I would say I would give something they need more that they want. Still, it depends though on the person. by the way, wait, why do teenagers need a new tablet or computer? Haha! That costs too much. They are kinda choosy nowadays.

  • I would definitely put the money in the college funds for the kids this year. They’ll get plenty of other gifts from extended family anyway. 🙂 We’ve done the 4 gift rule in the past, but now we just set a smallish limit and get a combo of stuff that they both want and need. As an example, our oldest is an artist, and goes thru a huge number of pencils and erasers on a monthly basis. Last year, one of the gifts we got her a 24-pack of her favorite expensive drawing pencils. This year, we got her a high quality electric pencil sharpener as one of her gifts. Getting stuff they want and stuff they need is a huge way to save on money during the rest of the year.

  • Lyndsey says:

    I love this idea! But how does it work with Santa gifts and gifts from siblings? Are the 4 just from mom and dad?

    • Cat says:

      It’s four gifts total. They are both 19 months old so they don’t know who Santa is yet and aren’t old enough to pick out something for each other yet. If I would have to guess for the future, though, Santa would probably bring 1 big gift, we’d do 2-3, and their sibling can have fun picking one out for them too.

  • Natalie says:

    I discovered The 4 Gift Rule late last year. I decided to start using it this year. With it in mind, I started shopping early:

    •I got my son a secondhand swing set. There is a broken trampoline attached. He always wants to play on it. That quickly became his WANT present. I got him a Little Tikes trampoline.

    •He’s 22.5 months old and is a sponge!!! He knows all of the colors, numbers 1-10, uppercase alphabet and most of the lowercase alphabet. To keep him on the education path, his NEED gift is a 9-pack of puzzles (think: Melissa & Doug) with a puzzle rack.

    •I bought his WEAR this summer. It’s a pair of Cookie Monster shorts pajamas. We live in the south where some Christmases are warm while others are cold. I’m going to add a pair of Thomas & Friends long-sleeve pajamas just in case the weather is cold.

    •Kohl’s has books for $5 as part of their Kohl’s Cares line. He looooooves books, so I got him 3 or 4 the current offerings for his READ, plus 3 or 4 of the past books (If you give a pig a pancake, If you give a moose a muffin, etc). The past titles were only $3 each.

    Many people give 4 total gifts, I give 4 categories, so my son actually opens more than 4 boxes.
    I have had some people politely tell me how nice the 4 gift rule sounds, while a few others tell me Christmas is a time for me to go overboard on gifts (for my soon-to-be 2-year old). I just realize only 9 days after Christmas, he’ll be inundated with MORE presents from his birthday.

    So much for not raising an entitled brat!!! lol

  • ChrisAnne says:

    I have 2 children who are grown now and we always did 3 gifts for them. One from mom, one from dad, and of course one from Santa. My son and daughter have a total 4 daughters and they both liked this idea when they heard about it. Actually my daughter had thought this is what I had did with them growing up…. 🙂

  • Jessica says:

    I heard about the 4 gift rule earlier this year and I think it’s great! My husband and I have 5 kids between us, so, you can see that can get very costly. We have always worried about how we are going to afford Christmas.
    When I was little we were showered with gifts, so many, too many really! So naturally I thought I should do the same with my kids… But we couldn’t afford it.
    I worry that my kids will think they aren’t getting enough but, I always tell them to appreciate what they have, some kids get nothing!
    I have read, also, about the Christmas eve gift… With the pair of pajamas, hot cocoa, popcorn, & a book &or movie! I think that we will do that this year! And then they can open gifts from Santa in the morning! (Even though 3 out of the 5 don’t believe anymore)
    P.S. Thank you to whomever suggested the $5 books you can get at Barnes and nobles!

  • Jessica S. says:

    Nice idea, however that list is definitely not even close to frugal! A cell phone, laptop, vlothing gift card and books…that’s over a thousand dollars!! (Per kid)

    • John Schmoll says:

      “Also, remember the above suggestions are merely options. You can customize the four gift rule to your budgetary needs and particular situation.” – I see your point though you apparently didn’t read the last few sentences…you customize it to your situation and they’re only suggestions. The whole point is you make it what you want…which is going to be different for each person!

  • Stephanie says:

    This rule sounds great to me. I’m a grandma on soc.sec. and I love to spoil the little ones. But this year the grand total for grandkids and great grands is 15 so it would be very pricey. The 4gift rule will help me keep a handle on things.

  • Leigh says:

    I implemented this last year when my boys were 2 and 5 and I thought it was great. My mom loves to overload on Christmas, so I compromised by giving the four to each of the boys and then 2 big gifts they could both share. I didn’t feel like it was “sparse” under the tree. I feel like it’s so worth it to cut out the filler junk and stick to good, quality gifts that my kids will play with all year. The big “want” gifts ended up being a big excavator toy for the 2 year old and a big box of legos for the 5 year old. And they shared a set of Gears (Learning Resources) and Magnatiles. Eleven months later, the legos and magnets are still played with almost every day and the gears are pulled out probably once a week.

  • GirlErrant says:

    I’ve adapted the rule to:

    Something you want (Lego/Shopkins)
    Something you need (Hats)
    Something to share (water slide and a digital camera)
    Something to read (Black Beauty and The Jungle Book, hardcover)

    I find it harder for me to stick to it than for them to be happy with it!

    AND – I cheat. They still receive gifts from relatives AND some smaller bits from from Santa.

  • Angie L says:

    We altered it just a bit because none of my kids need anything to wear. So they are each getting something you want, something you need, something to play with, something to read. I have 4 daughters and the play withs are: canvas and paints (11 yo), quick cups game (6 yo), playdoh set (4 yo) and haven’t found anything for my 17yo but thinking an art set. The also get a gift, book and filled stocking from Santa.

  • Vicki P says:

    We began three-gift giving for Christmas, just as the Christ-child was given three gifts. The children were happy with their gifts and we could give to other families who were in need.

  • Gosh it’s pretty incredible how many gifts certain kids get these days, all while other families struggle to get any gifts for their kids (random thought). I think this is a good rule to follow, though I think it wouldn’t work great once your kids know how $ work. For example what if “something they want” is 5 things at $20, and their sibling it’s one thing at $100? Not that it’s all about the money, but I think setting a budget is good, especially once kids understand money.

  • Ann says:

    I am looking for frugal ideas for Christmas gifts for my 4 children. I have spent a number of years fighting a bad cancer diagnosis, so we have never been able to give much for Christmas. But this year, due to some complications, we cannot do anything. We don’t have an extended family to rely on for giving the kids gifts. I am stressing searching for ideas for anything I can give them this year. I would appreciate any ideas that you have. Thank You!

    • John Schmoll says:

      Hi Ann,

      So so sorry to hear that. I wish I had the perfect answer to give. Some ideas…do you have any secondhand stores for kids in your area? We do and they often have toys at a significantly reduced price. One other option, and not meaning to offend here, have you approached any churches or other charitable organizations? Don’t know that they would help, but definitely worth the ask.

  • Montanna Washburn says:

    What about stocking stuffers? Do you do that or no?

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