We brought back a Christmas tree last night. There were only three left on the mall lot near our house, and we were not expecting any more.
We were grateful because we have a few small children who spend the holidays with us. And there is nothing more magical than those twinkling lights, ornaments and the sweet smell of evergreen leaves in the house.
The gift ritual, of course, is an integral part of it all, but when it comes to holiday gifts for kids and teens, I tend to use it as an opportunity to give gifts that have the potential to last for years.
Let me explain what I mean.
While parents naturally feel the pressure to give their young children toys and games, my husband and I, who have no children but a series of nieces and nephews, realized a long time ago that the one of the best holiday gifts we can give is smart money.
Read: This simple investment can earn you more than 6% risk-free
Here are seven last-minute money ideas to consider based on the ages of the people on your list:
Cash. My Great Aunt Gladys gave me and my three siblings $ 25 each at Christmas when we were kids. All these years later, I still smile at his gesture and remember his generosity.
My nephew, Mike, reminded me of the power of cash when he was about six years old, I remember. He urged me not to spend money guessing something he might want.
Cash is never a bad gift, trust me. Mike will support me on this.
Even though I now admit that our “kids” are in their 20s and 30s and are launched, we are giving away gift cards to restaurants in the towns where they live, so they can treat themselves.
A book on the basics of money. A friend at the dog park asked me this morning for a book he could give his teenage daughter to start learning about finances. I did not hesitate to answer. Two of my must-haves are the books by Beth Kobliner “Get a Financial Life: Personal Finances in your 20s and 30s » and “Make your kid a money genius (even if you aren’t).” Beth is an authority on personal finance and a former colleague at Money magazine.
A subscription to a financial publication. This is perfect for a youngster who is starting to show some curiosity about money matters. I recommend Kiplinger’s personal finance magazine. The annual subscription will cost you $ 29.95 per year.
I have savings bonds. There is a minimum electronic purchase of $ 25, and they are now paying 7.12%. More, I’m bouding are sure to keep pace with inflation. They earn interest for 30 years or until cashed out, whichever comes first. On the other hand, if they are cashed before five years, the interest of the previous three months is lost.
To find out how to buy gift vouchers, go to Direct Cash.
Read: Hidden in plain sight, a US Treasury brings in more than 7%
I realize it is too late, make it as a Christmas present this week as your funds will need to be cleared, but you can print the certificate and pack it. Your child will be notified by e-mail from TreasuryDirect once your funds are cleared.
529 account. Don’t expect screams and cries of joy for giving this one to your young gift, however, it is a good gift. You can open a tax-sheltered 529 account with a child as the beneficiary for as little as $ 25 in many states. The 529 cash can be used tax-free for tuition. Potentially, you can get a state tax deduction for putting money into the account, depending on where you live. You can find out more about these state sponsored plans at Savingforcollege.com.
You can also buy a College donation gift card at approximately 3,000 retailers across the country, including Target TGT,
and online, provided that the child or young adult already has an account on the crowdfunding platform. Amounts range from $ 25 to $ 200 and can be used to complete a 529 plan or pay off a college loan.
A Roth Individual Retirement Account (IRA). the I counts opened in a child’s name, and you must share the child’s social security number when you open the account. It’s a great way to give them a head start on saving for their own retirement decades later. This time alone is a real gift of value over time for their future financial security.
Most banks, brokerage houses, and mutual funds will help you set up a Roth IRA custodian or custodian for a minor. As the custodian, you control the money in the account until the child reaches the age of majority in his state; then the assets are returned to him.
One condition: this gift is best for teenagers who have income from seasonal or part-time work. The child must have earned income at least equal to the total amount you will put into the account.
An investment account A great way to learn how to invest is to do so. The traditional way to do this was to help your beneficiary buy a mutual fund or shares in an exchange traded fund (ETF). I like this route because you both buy a basket of funds as a team. One of my choices is the Vanguard Total Stock Market ETF, a mix of actions of small, medium and large companies. Current price: just over $ 234 per share, which may be more than what you want to spend, but an idea worth considering. A detail: If he is under 18 and not your own child: his parent or guardian must first create a custody account.
The website Stockpile.com is another fairly straightforward option. Children can own shares by having an adult in a custody account with them. “The minor (called the beneficiary) owns the stock, while the adult (the custodian) has legal responsibility for the account until the minor is old enough to have their own individual account,” according to the site. The miner has their own Stockpile ID so they can review their stock progress and request stock trades, but the custodian (you) will need to approve.
Essentially, you open an account for a minor and buy fractional shares of over 1,000 stocks and exchange traded funds (ETFs) by sending a $ 1 to $ 100 gift card. Or the child can choose with your advice the stock when you send the gift card. There are no trading fees. There is also a practical beginner primer on the investment in the site that you can encourage them to tap into or browse it together. And honestly, you could benefit from the upgrade yourself.
This teamwork can be very engaging. Plus, helping him learn the ins and outs of investing will be a gift that will serve him well for the rest of his life.
If you still feel like giving a fun gift to enjoy Christmas Day, for my money you can’t go wrong with the classic Monopoly board game which costs around $ 38 on Amazon at present. It was my first memory of money back in the 60s, and my siblings and I had a lot of bouncy games.