The Gifts Smart Grandparents and Relatives Give to Raise Financially Savvy Kids

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holidaygiftsChristmas is right around the corner, and if you’re like most people in this country, you’re busy buying gifts for your friends and family.

If you have a child or teenager to buy for, you may be tempted to buy the latest toy, video game, or electronic device.  After all, what kid doesn’t love toys or electronics?  How can you go wrong?

While the child may initially be pleased with these gifts, you have the power to give a long-lasting gift that will keep giving for years.  Why not make your gift more meaningful this year and give a gift that will help financially educate the child or put him or her in a better position financially?

There are plenty of gifts you can give that meet this purpose:

  1.  Money Savvy Generation banks.  Piggy banks have been around forever, and are a good way for little ones to start saving.  However, with a traditional piggy bank, all of the money is lumped together.  Money Savvy Generation offers a piggy bank that is divided into four categories:  Give, Save, Spend, Invest.  Kids can divide their money between these four categories, so they learn how to handle their money wisely.  This Christmas, I am buying these for all three of my kids.

This bank has won numerous awards including the Parents Choice Gold Award.  At only $19.99, they are a reasonable gift that will help the child learn better money management.

  1.  Dave Ramsey’s Financial Peace, Jr.  In the same vein as his popular Financial Peace kit, Financial Peace, Jr. is Dave Ramsey’s kit for kids ages 3 to 12.  Kids will learn about doing chores to earn money, separating money into save, give and spend, and working with a budget.  Included in the kit are give, save and spend envelopes, an activity book, calculator, crayons, stickers, Battle of the Chores audio book, chore chart, magnet frame, and link to website exclusives.

My kids received this kit as a gift.  My youngest at the time was 3, and she did not really get much out of the program.  However, my 5 and 9 year olds really enjoyed it, and I think they learned some important lessons.  This kit is normally $24.95 but is currently on sale for $19.95.

  1.  College fund donation.  A wonderful gift for a child is a donation to their college fund.  The younger the child is, the more this gift grows in value over the years.  If you regularly donate to a grandchild or niece or nephew’s college fund for birthdays and holidays, you could make a significant impact on the child’s savings, especially if mom and dad aren’t able to save as much as they would like.
  2.  Stock investment.  There are several ways you can gift the child in your life with a stock investment.

One share.  Some companies like One Share allow you to buy just one share of the stock.  They then frame the stock, and it is presented as a gift.

A set financial amount.  A different strategy is to open a custodial account for the child (which is possible if you’re the parent or grandparent), and then invest a set amount.  If you’re choosing this option, a smart plan is to invest in a stock that pays dividends and then to set those dividends to reinvest.  The money will continue to multiple as more and more shares are purchased thanks to the dividend reinvestment.

Toys, games, and electronics are nice, albeit, short-term gifts.  To make a lasting impact on a child, consider buying one of these presents that will keep giving for years to come.

What is your favorite financial gift to give to a child?


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Melissa is a freelance writer and blogger who covers personal finance, education, and parenting topics. She blogs at Mom's Plans.