Financial Gifts for Children and Teens

Financial education should start early, but it doesn't have to be a boring education. Diego Cervo/Shutterstock

The gift-giving season can be tough on everyone. But coming up with a gift for a child or teenager is daunting. Well, you don’t necessarily have to worry about the latest fashion or craze when giving a gift.

There are financial gifts you can give your child or grandchild that are more sustainable than that gift card to Old Navy and are still fun. It’s all in the presentation.

Give Children Wallets

A wallet may seem mundane, but it represents fiscal responsibility. Teach them that the wallet is important and what it represents. It’s the keeper of money and important documents and must always be held and guarded.

Keep in mind that children will probably be receiving multiple gift cards. Show them the slots in the wallet where they can keep them. Help them organize the cards. Remind them that the gift cards are the same as money and, therefore, go into the wallet.

Make it fun by purchasing a wallet in a fun print or color. If they like Hello Kitty, then find a Hello Kitty wallet. If your grandson likes anything red, make it a red wallet. Whatever it takes to make it personal for your child.

It’s even more fun if you slip a dollar or any other denomination into the wallet. Instill in your child the importance of the lowly wallet.

Make a Charitable Donation

Making a charitable donation in a child’s name is commendable, but it’s even better if the child picks the charity.

Choose a list of appropriate charities you think your grandchild will like. Then sit down with them and explain that you’re going to make a donation to one of these charities in their name, and they will choose which one.

This opens a discussion about values and priorities as you discuss which charity to give the money to.

Let your grandchild be part of the giving process. If you’re donating online, let the child help you. Even better, if you donate in person, the child will be able to see where the money is going. This works particularly well with animal shelters.

A Meeting With a Financial Advisor

Most people are familiar with the adage “Feed a man a fish, and they eat for a day; teach a man to fish, and they eat for a lifetime.” The same holds true with financial learning.

This one is for your older teens or college-age grandchildren. Buy an hour of a financial adviser’s time and let your teen meet with them on their own.

Young people have questions about their future, and financial questions are part of it. Most don’t know where to go to have them answered. In fact, many don’t know what to ask.

A financial adviser can teach them basic concepts such as creating budgets and managing credit. Managing credit is probably the most important. An adviser can also explain the difference between saving and investing.

Your teens may look blankly at you when they receive your gift, but they’ll probably acknowledge later it was the best gift they ever received.

Purchase a Stock

This doesn’t necessarily have to be for just the teens or college-age children. Younger children can enjoy this, too.

With the help of the child, choose one stock (or more if you’re so inclined) that they’re interested in and purchase it. You might select several stocks and then let the child choose from those. A young child might be interested in stock from a video-game manufacturer, a movie studio, or a cell phone maker.

An older child may be interested in discussing how the stock is performing. Either way, it opens up a conversation with the children about investing.

Explain that by buying the stock, they become a part owner in the company. This is a learning opportunity for the child regarding investing.

If an individual stock is pricey, consider buying a partial share.

You’ll need to open a custodial account at a brokerage firm if the child is a minor. Many brokerage firms have little or no minimum investing requirements and charge low fees.

Contribute to a 529 College Savings Plan

Contributing to a 529 college savings plan is a gift that keeps on giving. The money grows tax-deferred through the years. It can be used tax-free for college tuition, room and board, and other college expenses.

You can either contribute to an existing account or open up a new one and make the child the beneficiary. There’s no limit to the number of 529 accounts where the child is the beneficiary.

Give Children a Financial Leg Up

Financial education should start early, but it doesn’t have to be a boring education. Whether it’s choosing a charity to donate to or picking a stock to buy, it empowers children and lets them dip their toes into the financial pool.

The Epoch Times copyright © 2024. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.