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How to Set Financial Boundaries For The Holidays With Family
Family Finance

How to Set Financial Boundaries For The Holidays With Family

Your holiday expenditure is about to go up. You will have to worry about more than your immediate dependent's needs and expenses. Relatives and friends might also look your way for financial help. And to ensure that you support them without straining your finances, you will need to set boundaries.

Without financial boundaries, you can overspend in the name of being helpful. You can also derail your goals as your will be using money in ways that don’t benefit you. While helping your loved ones during the holiday isn’t bad, you must do it in moderation and spend only what you can afford. And financial boundaries help you do that.

This article will explore what financial boundaries are and how to set them when dealing with loved ones to ensure you keep your finances in check during the holiday season.

Read Also: 10 Tips to Survive the Holidays if You Have no Money

What are Financial Boundaries?

As you get older and increase your income, you will quickly realise that more people will start depending on your success. And no matter how generous you are, you can't help them all. And if you try, you will quickly run out of money to sustain yourself. So, you develop boundaries that ensure you support those who need your help but also look after yourself and your future.

Financial boundaries are the rules and limits you set around spending, loaning, and giving money. They ensure you financially protect yourself before you consider helping others. These boundaries keep you financially stable.

Financial boundaries protect you by helping you strike a healthy balance between your finances, yourself, and your loved one. For example, having a budget creates a boundary that helps you live within your means. And keeping your black tax below 5% of your income ensures you have enough money to save for your future. 

Financial boundaries are specifically important during the holidays when your loved ones need your help the most. They could be expecting gifts or other forms of financial assistance, like helping them pay school fees for the kids in the coming year. Others could want you to foot all the bills when you go out.

But when you have rules and limits guiding your holiday spending, you can know when to help and when to say no.

Read Also: How To Stay Focused On Your Goals With an Unsupportive Family 

5 Ways to Set Financial Boundaries For The Holidays

Now that you know you know what financial boundaries are and their benefits, how do you establish them?

Here are five steps to follow.

Know Where you Stand Financially 

Before you go out of your way to grant everyone's wish during the holiday, you need to know where you stand financially. Can you afford to support your loved ones without hurting your finances? The first step before you think of helping them is ensuring you are financially in the best shape. 

You can achieve this by conducting a personal financial checkup and asking yourself some vital questions like:

  1. Have you addressed your immediate needs? - You need to be sure you can meet your expenses before you finance those of your loved ones. If you are yet to determine how you will pay your January rent, it might be a good idea to figure that out first.
  2. Where will the money come from? - Did you separately save for holiday expenses to buy gifts for your friends and family? If you didn't, look at where the money will come from. Will you withdraw from your goal saving account or take on debt? Now think of the repercussions that could have and make a decision. 
  3. Have you stuck by your boundary? - Did you stick to the boundaries you made for yourself?  If one of those rules was saving 20% of your annual salary, did you manage that?

Once you have the answers to those questions, you will know where you stand and if you are in a position to help others. If you're behind on your goals or need a loan to support your family, you will need to be selfish. Before spending it on friends, it could make better sense to use it to cover leaks in your finances.

Read Also: Top 5 Ideas for Reducing Money Stress and Reaching Your Financial Goals Faster 

Be Clear About Financial Expectations 

Communication is paramount when setting financial boundaries. You should let your family and friends know just how much you can help. This is even more important if you have experienced some setbacks this year and you won't be able to be as supportive as you were during the last holidays.

You can avoid inconveniencing situations or hurting feelings when you communicate your boundaries in advance. Talking about your finances to other people can be hard. But if you want to set boundaries, it might be necessary. It's the only way that you can put things in perspective.

If you are uncomfortable being vulnerable, you can always find ways to tiptoe around this and hope everyone will understand. For example, instead of waiting for your cousins to ask you to join them on a night out, let them know you prefer to stay indoors. Apply the thought throughout the holidays and in every aspect, from travelling to gifting. 

Read Also: 6 Financial Steps to Take When Making a Big Life Change

Stand up for yourself without Creating Resentment 

It might sound crazy, but people like to act like they know your financial situation more than you do. So when your friends or uncle ask for an urgent Ksh5,000 to refuel their car with the promise to repay in a few hours, they don't expect you to hesitate. They want the next question you ask to be, "Do you prefer cash or mobile money?"

But you know your finances more than them and know when to say no to money requests. But saying no to someone with a misguided mentality can be hard. When you turn down their request, they'll misconstrue it for stinginess. 

When you bluntly say no, you risk hurting their feelings, which can affect your relationship. Resentment, anger, and even hatred are built. To avoid this, stay prepared to enforce boundaries while considering people's feelings.

Going by the example above, instead of directly saying no, you can try this approach depending on your position:

  1. “I'm sorry, I wish I could be of help, but I currently don't have money on me right now.”
  2. “I'm sorry, I currently don't have that much, but I can pay for your fare if you choose public transportation. Let me know if that could be of help.”

When you politely say no or offer an economical solution that won't hurt your pocket as much, you can control how they react. And this can go a long way in keeping your relationship dynamics healthy.

Read Also: 6 Family Events That Mess With Your Finances in a Big Way

Don’t Let your loved one Guilt-trip you

Some of your loved ones will try all the tricks in the book to get you to abandon your boundaries. One common trick they will use, and you must prepare for, is manipulation. This is meant to tap into your emotions and cloud your decision-making process. 

They will remind you of the favours they did you, the importance of family helping each other, how you need to trust them to repay a loan, and other sob stories. If you are not careful, you can easily fall for it. You will feel guilty, and before you know it, you've broken your boundaries.

When setting up your boundaries, you must remember you can't be responsible for everyone's finances. You can't help everyone. Trying it will come with the cost of you to give up control of your finances and your goals. Therefore, know when to say no, and when you do it, don't feel guilty.

And speaking of emotions, you should also not consider them when deciding who to help. Look at the facts. They will help you determine who you should spend money on.

Read Also: How to Figure Out Who is Worth Spending Money On

Be Ready for Pushback 

Not everyone will respect your boundaries and take no for an answer. So people will try to hold it against you and even try to punish you for it. But you must prepare to stand up for yourself and weather any storm. After all, you will be the one who will suffer the most in the long term if you don't have boundaries.

Be firm about your boundaries and ask your loved ones to respect your decisions. Let them know any help you have offered is the best you can do, and you can't afford to go beyond that. 

Finally, remember why you set the boundaries in the first place. Staying on track can be difficult, but you will have yourself to thank at the end of the day. Soon the holidays will be over, and everyone will forget about it and continue with life. And when you sit to review your finances, you will be proud you weren't shaken by any pushback you faced.

Read Also: How to Achieve and Maintain Strong Financial Health


Staying the course and keeping your financial boundaries is hard during the holiday, especially when dealing with people you love. Somedays, you won't be able to say no to these people you care for and love unconditionally. You might have to break your boundaries once in a while. 

You might be triggered into overspending, fall for peer pressure, become too generous, or pick up old habits that lead to money wastage. When you experience such setbacks, remember they're all part of the journey. So lift yourself and get back on track. 

Learn from any mistake you commit and let it drive you to keep your boundaries stronger. Finally, be patient. It might take time for some family members and friends to come around and respect your financial boundaries. In the meantime, learn not to go too hard on yourself.

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Farah Nurow is an experienced Content Writer who enjoys writing creative and educative articles meant to provoke readers' thoughts. He loves sunny weather and thick books. You can connect with him on LinkedIn.

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