As we grow up, there’ll come a time when we ask ourselves: “am I spending too much on my friends? Is there a limit as to how much should go into a birthday gift?”
Thankfully, famous Chinese businessman Li Ka Shing has a formula:
Your Salary x 20% = How much you should spend on friends
So, if you make $500 a week, then you should be spending $100 of that on friends. That’s a lot!
Truth is, Li Ka Shing (being a businessman) is treating that $100 like an investment. He goes on to say that, “you should spend on people who are more knowledgeable that you, richer than you, or who helped you in your career.”
Okay, but what about the rest of us who don’t necessarily want anything out of our friends?
For me, my rule of thumb is: Usually $25, and up to $75 for close friends.
Is this rule of thumb reliable?
Of course, this really depends on a few things, like:
- What’s customary in your circle of friends? Your age and social status may affect how much you should give.
- What’s the occasion? If it’s just a night out on town, don’t go beyond $25. If your friends typically order alcohol and it drives up the bill, be selective on which nights you hang out on. If we’re talking about gifts, you might give less on birthdays than you would for a wedding gift.
- How close are you to that person? I’ve kinda touched on this already, but obviously I’m willing to spend more on closer friends than I am with people I’ve just met.
- Is your friend conscious about gift prices? Different strokes for different folks, they say. You’d probably be willing to splash out a bit more on a friend who’s more materialistic. For someone less into the glitz, you might make be able to make a card or some sort of craft work for them.
Unfortunately, this is not a question with a clear cut answer. You’ve heard my rules of thumb, but you have to come up with your own.
I know, I know – it’s not easy. On one hand you want to show your friends that you’re sincere. On the other hand, all these little “events” and dinners can add up.
One thing you might want to do is try to change the culture in your friend group. Of course this requires a difficult conversation, but you might surprise yourself – your friends might be all thinking the same thing, just that they’re not willing to talk about it!
If you’re not willing to make you feelings known, I suggest you do this:
If you’re unique, your friends won’t care how much you’re spending. Because your effort shines through it all.
Throw an intimate get toegether – Instead of going out on the town, start a little earlier and have a picnic at the park! Or play the “generous host” and have everyone over at yours for a potluck! You can save heaps this way.
Save money, spend time – If you’re giving gifts, why not try some crafts? There are loads of free instructions online. Or, if you wanna go all the way, you can take an online course to learn some craft skills that you can use again and again. For example, check out this sick origami course for just $10.
Set aside some dough for when you really need to spend – Having a “spend on friends” fund can take the sting out of blowing a wad of cash on a single dinner, or gift. Put away a % of your salary each month for friends (kind of like that formula at the start of the article.)
Because you’ve set aside money for that purpose, it’ll be easier for you to apportion a bit of the fund to pay for your friend’s do.
Don’t get me wrong. I am not a birthday hater. I view these occasions as an opportunity to spend time with friends. A birthday celebration is not an ego-centric, attention craving event. It is a chance for all of us to get together and honor our friendship. All I want is to be reasonable about it.
I would never put a price tag on a friendship. Nevertheless, I do want to let my friends know this:
“Money can buy you company, not friends.”