Canadians are feeling spread thin this month. Two in every five people can't afford the extra costs that come with the holiday season but feel pressured to take part anyway, especially when it comes to spending on gifts.

And shopping budgets are rising in tandem, a new Canadian Imperial Bank of Commerce survey finds, up 8 per cent this year to an average of $643 across Canada; other spending, on expenses such as decor, entertaining, and boxing-day sales, averages $291. Consumers, in turn, are stressed. Nearly two-thirds of the survey's 1,512 respondents called holiday spending "out of control." Slightly over half already expect to go over budget.

Three-quarters of Canadians would rather save more money during the Christmas season. It might be time, the bank says, for Canadians to "reset expectations" when it comes to the holidays, and to be more open with loved ones about the financial stress the season can bring. "Your family and friends may be feeling it as well," says Kathleen Woodard, CIBC's senior vice-president and regional head for Ontario.

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So this is an opportunity, she continues, to have honest conversations "about how you choose to spend that holiday time in a way that is meaningful to you, and reflects your shared values."

While half of consumers will use cash or debit to cover costs, 59 per cent said they will use credit – up from 46 per cent last year, though most credit card users expect to pay off their balances quickly. And rewards points and gift cards are becoming more popular, the survey found – especially among women, millennials and people living in Atlantic Canada.

Scott Terrio, an insolvency expert and president of Debt Savvy in Toronto, says he doesn't see many insolvency filings in December "because people are really busy getting into trouble." Then, in mid-January, his four busiest months of the year begin. He has a ready-made list of suggestions for people looking to curb their spending in the Christmas season.

"Cash hurts," Mr. Terrio says, since handing it over feels like so much more of a tangible loss than tapping a card. Separate that cash into envelopes for each person on your gift list, he continues; that'll let you realize just how finite your budget is. Letting yourself browse malls is a trigger to spend, too: "Go and buy – don't shop." And save extra money by hitting a dollar store for anything you're going to throw out anyway, such as wrapping paper and tape, he says.

Some consumers are adapting how they handle the season to curb stress and overspending: 38 per cent said they've already changed a tradition; 43 per cent put hard limits on gift spending; and one in five Canadians are turning to a single gift exchange, like a Secret Santa.

A quarter of respondents said they're turning away from gift exchanges altogether, while 14 per cent said they spend money on a shared experience with loved ones.

The Atlantic region had the biggest budgets among all age groups, at $827, while Quebec had the lowest, at $479. Consumers aged 35-to-54 expect to be the biggest spenders this year, with average shopping budgets of $669 – roughly the same as last year. Millennials, meanwhile, are planning for a 39-per-cent jump in holiday shopping spending this year, at $555 on average.

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Especially for younger consumers, there can be a pressure to spend and shop at the same rate as parents or grandparents – but that doesn't mean they should spend beyond their resources, says Andrea Thompson, a senior financial planner with Raymond James Ltd.'s Coleman Wealth in Toronto. "There's a lot of pressure from a lot of sources to maintain appearances," she says.

On top of sticking to a dedicated budget, she recommends starting to set aside money for the holidays as far ahead as January to have a cash-flow reserve ready. And what family often wants most, she points out, is simply to spend time together. "If you give them the gift of having everyone over for a lovely meal," Ms. Thompson says, "that probably goes a lot further than a $25 gift certificate to Apple."

*(Editor's note: An earlier version of this story had an incorrect place of employment for Mr. Terrio. It has since been changed.)