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Gift Your Friend: A Budget Guide For Different Occasions

Gift Your Friend: A Budget Guide For Different Occasions

Birthdays, anniversaries, weddings and other occasions- the reasons to gift things are many. If you have a large family or a huge circle of friends, then your wallet is not going to be too heavy at any time of the year, thanks to all the gifts you give. Gift-giving is wonderful. You get to pick out something special for a person, make them happy, and spread cheer and goodwill. However, if you are not careful, you could end up spending a lot of money on trivial things.

When shopping for gifts, it is important to budget. Whether it is for birthdays, or for a festival, having a plan goes a long way. The first step towards being careful is to understand the difference between the relationships you share with the people you are gifting. Allocate a different sum of money for a good friend and a colleague, a close family member and a neighbor, and so on.

Second, take into account how many times in a year you will be gifting the same person- birthday, anniversary, festival, special days, etc. Budget accordingly. Even with friends, chart out different sums of money to spend on those with whom you share closer bonds.

It is important that you arrive at a number after making a calculated analysis. For example, if you want to buy your closest friend a gift, you would not spend the same amount of money as you would spend on a recent acquaintance at work. There are many ways in which you could find the best gifts for the people in your life, without breaking the bank. Read on to know.

How do you budget a gift for a friend?

A simple way to estimate how much you ought to spend on your friend’s gift is to consider a few factors-

  • How much money you can spare
  • How close you are to the person
  • What kind of gift do they appreciate and what they are expecting
  • Any discounts that are available on the item
  • How many times in a year do you have to gift them

Although this seems easy enough, when it comes down to the actual spending, we are at a loss. Most money experts have one piece of advice- plan in advance. Put aside some money every month as part of your gift budget. Try and estimate the number of people you will be gifting- there is a group of people who are constant across the years- your friends who live in the same city, friends from school or college who have traveled along life’s winding roads with you, your 4 a.m. friend and your retail-therapy friend. There could also be new friends that you meet at work, or while you travel.

First of all, decide how many of these friends you are gifting. Then, select which of them deserves an expensive gift and which of the gifts you can pick off the shelves without much thought. Once you have that figured out, stay on the lookout for deals throughout the year. Online stores, stand-alone branded stores, and other places have discount sales throughout the year. You could decrease your expenditure if you were to stay on the lookout for gifts during that time, even if the occasion for gifting is a few months away.

Second, choose the right gift. For a pregnant friend, you could buy jewelry, or for the same amount of money, book a spa experience. While the piece of jewelry would last a long time, the thought behind the latter gift would reassure her about how you value her friendship.

Third, budget according to the number of occasions. If you have a friend whom you send gifts to on her birthday, wedding anniversary and a festival, then, choose one of the occasions for a big-spending, and the other could be something less expensive.

Here’s a general tip: your annual gifting budget should be around 5-7 % of your annual income.

How much should you spend on a gift for a friend?

Now, here is a question that is like the quintessential riddle about the chicken crossing the road. How much do you actually spend on a friend? How much is too much or too little? There could be varying answers about this. So, we have put together a chart to guide you, and give you an explanation for the same.

Ideally, we would recommend that you chalk down an amount for each, based on how much you can spend. Here is a sample estimation chart that you can use.

Type of relationship Percentage of total gift budget
Best friend 40 or more
Other close friends 20-30 (depending on the number)
A friend you have known for a short while 10
A friend you meet occasionally 5-10
Friends who live far away 10

Keeping this in mind, here is an example of how much someone who has a budget of about 20,000 rupees would spend.

Type of friend Percentage Amount
Best friend 40 ₹ 8000
Close friend 20 ₹ 4000
Shopping buddy 10 ₹ 2000
A new friend 5 ₹ 1000
Others (friends from work, college, neighborhood, fair weather ones, returning favors) 25 ₹ 5000

The last row contains a sum of ₹ 5000 in this sample chart. Though the sum looks like a hefty amount, remember that it is split between many gifts. For example, you would spend more on your friend at work than on that colleague who is your friend only for pot luck dinners and cab-pooling.

Sometimes, friends could pool in cash to buy a gift for an occasion. For example, if a friend is tying the knot this year, it would be more feasible to pool money together to gift her a vacation or something that would make her steps into marital life easy or more memorable.

Again, there is no rule that states that you should spend the same amount of money on the same person every year. Since our relationships are fluid and change over time, as does our bank balance, the same budget will not work every year. You could splurge on a birthday gift for your best friend this year, and not spend even a fraction of it next year. The same goes for gifts for different occasions in the same year. You could spend a lot of money for your friend’s birthday, but get them only a box of sweets for Diwali.

How much of the budget should be gifts?

When you live in a country like India, there are numerous occasions to gift and spoil your friends- birthdays, festivals, Friendship Day, wedding anniversaries, other special occasions, and random reasons that we find. With so many options, it is not necessary that you buy something to commemorate every event. Your budget may not cover all of these.

You could spend about 80% of your budget on material gifts. The rest, you can use to devise thoughtful ways to make their day special- give a gift, cook a meal, surprise them with something handmade, order a cake, etc.

There are many different kinds of gifts that we can give, but we eventually arrive at the same- perfumes, accessories, stationery, jewelry, cards, chocolates, and wine. Remember that you end up spending a lot more if you do not have a plan and decide to walk into a shop and choose something that grabs your attention.

Also, if there are multiple events to celebrate in your friend’s life in a particular year- a birthday, a wedding or an anniversary, a bridal shower or a baby shower, and so on, you cannot spend your annual gifting budget on one person. So, plan it in such a way that she has something memorable for each occasion. Buy her a gift for the wedding, by planning it with other friends. This way, everybody contributes towards the gift and you are not buying it alone.

For her birthday, surprise her with a custom cake from a store like Cake Buzz. If it is a bridal shower, order a cake from Cake Buzz, and pick out and decorate the venue. Gift her a surprise for her baby shower by inviting people she has not met in ages. The essence- not all gifts need to be materialistic; some can be the most delicious cakes she has tasted, while others can be memories to cherish.

How much do I spend for each occasion?

This is entirely subjective. If you are a jet-setter whose friends spend their birthdays in exotic locales, then, your budget would be higher than the average person’s. However, if you are someone who is able to set aside about 5% of your salary for gifts, then, you divide that amount among the occasions that you are gifting for. About 3% is for birthdays and festivals, and 2% goes for other events.

Let us look at a few situations to help you narrow your budget calculations down.


Birthdays come every year. Our friends may or may not be available for a birthday bash. It is easy to send birthday gifts to any part of the world. The budget for a friend who is always around for you could be between 2000 and 8000 rupees[1]. Since your friends become closer to you than family as you grow older, it becomes easy to choose gifts for them. If your friend is living close by, you can plan their birthday, and order a cake from Cake Buzz to make their birthday extra special.

You can spend anything from ₹ 500 to ₹ 3000 on a friend that you do not meet or talk to often. Anything from a nice piece of stationery to an accessory that they could use would be a good gift. You can also spend on something handmade or a nice item of clothing to make their day.


We celebrate various festivals. It is also possible that your friend and you celebrate different festivals with your respective families, owing to religious beliefs. This way, you have more reasons to binge on delicious food and gift each other. Each festival has a traditional gift such as a box of sweets for Diwali, biryani or sheer kurma for Eid, cakes for Christmas. Nowadays, more and more people opt for cookies and cupcakes during all festivals. The chefs at Cake Buzz recommend some signature cakes that capture the mood of the festive season.

It is a good idea to spend less than ₹ 1000 on festive gifts for your friends- a box of sweetmeats, cakes, cookies, or a box of dry fruits. If you are on an annual budget for gifts, you could allot more funds to other occasions by gifting homemade sweets for festivals.

If you work at an office where there are gifting traditions like Secret Santa, then include that while planning your budget.


Weddings in India are a grand affair, and gifts range from household items to silverware and jewelry. These are the big-budget events. The easiest way to meet expectations is to create a group of people who would like to gift the couple- friends, near and dear ones. Then, choose a gift and pool money together so that the couple receives a gift that they have been eyeing, and your wallet is not empty.

The budget for a wedding gift differs slightly from the annual gifts. Since weddings do not occur every year, a separate budget for a wedding gift is a good idea. Especially if the one getting married is a close friend. In this case, the budget could be up to ₹ 10,000. If you are buying jewelry, then, it could go higher than that.

Bridal showers:

Bridal showers are also not a common occurrence. So, it would be a good idea to allot funds separately for this. If you are the maid of honour or a bridesmaid at the wedding, then, it would be a good idea to help with the organization of the party, instead of spending on gifts. So, in this case, you could use the money for decorations, cake, the venue, and so on. If you are planning the event, you could spend up to ₹ 5000, and enlist the help of other friends for the same.

Baby showers:

Baby showers have gone from the traditional ones where everyone gifts jewelry to the expecting mother. Nowadays, gifts for the expecting mother include spa experiences or massages. These are more meaningful than clothes, baby products, and jewelry, as the mother needs rest and relaxation at this point in her pregnancy. A budget of ₹ 3000 should make you a thoughtful friend.


If you are a student or have a friend who is graduating, it is not necessary that your gift is a piece of stationery or jewelry. Instead of splurging on a gift, make a collage of your friend’s best moments at university, or even a scrapbook. Order a cake to celebrate their moment. Gift them a vacation so that they can unwind after the mental stress of the final semester. A budget of less than ₹ 1000 would be enough if you are an innovative college student. If you are gifting a vacation, then up to   ₹ 5000 would do.


If your friend has bought a new house and has invited you to the housewarming party, a household item as a gift is your first option. Depending on how close you are to them, you could spend anything between ₹ 500 to ₹ 10000, or more. However, unless you are almost family, we would not recommend spending a lot of money on the gift, especially if it is cutlery or furniture. Instead, you could bring them some food that they could use over the next few days, as they settle into their new house.

What should I keep in mind?

Since there are many opportunities for gift-giving throughout the year, we have to plan ahead. Gifts are a wonderful way to show that we care, but, if we give an unsuitable gift, it could convey the wrong message to the receiver. So, keep the following tips in mind when you plan your gifts.

  • Use an application that helps you budget
  • Set money aside- your personal ‘gift budget’
  • Buy during discount sales
  • Buy gifts when you see something you like, at any time of the year
  • Use your credit card reward points or even any rewards from your bank
  • Purchase shareable gifts
  • Create your own gifts

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