If you’re still looking for last-minute ideas for holiday presents, don’t forget about the gift of financial health. As the festive season kicks into full gear, it’s important to keep in mind how family and friends can support one another during the coming year. While money can be a tricky topic to discuss with your loved ones, you can show them you care with a gift that encourages their financial health and puts them on the path to managing money successfully.
And you can’t start too soon: Parents can start talking to their kids about money early with the help of a good children’s book or educational toy. They can also start saving for their child’s future now by choosing the right savings account or investment vehicle.
Depending on the child’s age, these types of gifts can open up conversations about money and create a fun and engaging way to learn about money.
1. Books and toys about money
There are many books and toys that encourage a positive relationship with money from an early age. These include toy cash registers, pretend money, kid-friendly check books, activity books or workbooks about money, board game involving money and piggy banks.
Because children learn about the world through play, introducing new financial concepts to your child through their imagination is a helpful way for them to learn. Reading them a storybook featuring relatable and loveable characters can be more effective than waiting until they’re older to give them the facts about how money works.
Consider purchasing a stock (or stocks) in a child’s name, as this educates your child about the importance of investing at an early age.
Even if they don’t earn a lot of money, your child can watch the stock’s value fluctuate with the ups and downs of the market and feel confident to invest on their own when they’re old enough.
Choose a company with long-term growth potential. Perhaps you pick stock in an industry that your child is interested in, such as sports or entertainment. Or you could use this opportunity to talk to your child about what your family values and/or let them choose a socially responsible company to invest in. Whatever the choice, there’s no doubt it will spark curiosity in your child.
3. A session with a financial planner
Working with a financial planner can be essential during times of great transition, such as starting or leaving a job, getting married, starting a family or making a major purchase. But there’s no harm in doing a financial check-up, and many advisors offer simple planning services, including apps and client membership websites, just for this reason.
A trip to a qualified financial planner can help even young children understand the value of money, savings, and investing.
4. Piggy Banks: Share Save Spend
Start younger children out with an allowance and three piggy banks. Label the banks Share, Save, and Spend. Shopping for the banks themselves can be fun. You can adapt this gift for older recipients by increasing monetary amounts and replacing the piggy bank with a checking account.
5. Create Opportunities to Earn Money
Kids need to have money of their own so they can learn how to make decisions about using it. An allowance can accomplish that. However, you should consider requiring your kids to do certain chores to earn their allowance. There are some chores the kids have to do without pay because they’re expected to help out as part of a family. But if they want to get paid, they have to complete certain tasks.
An idea on how to go about it: children who are still at home can get a weekly allowance in an amount equal to their ages. They will soon advance to get a “salary” that is deposited directly into their bank accounts each month. Kids can also negotiate raises for their salaries by agreeing to take on additional jobs around the house.