A good rule of thumb for Christmas spending on a niece is to consider your own budget and relationship with the child. If you have a close relationship and want to give a thoughtful gift, you might want to spend more. However, if the child is younger and you don't have a close connection, you can opt for a smaller gift or a joint gift with the parents. Ultimately, the amount you spend should be based on your own financial situation and what you feel comfortable with.