Rethinking Gift Giving for Children
Giving gifts to children and grandchildren brings us happiness and joy. The process of choosing gifts is often fun for parents, grandparents and other relatives. We express our love when we give gifts to children and we enjoy watching their reactions.
However, I believe that children often receive too many gifts, gifts they do not want, gifts they may never use or enjoy for very long. Many of us overindulge children. I’ve done this in the past, but I’ve changed my gift giving behaviors since having grandchildren. Give gifts you can afford and DO NOT go into debt to purchase gifts. Give gifts kids want or need, and some that will stimulate their curiosity or creativity. Consider a limit on the number of gifts that you give to a child (some people use a rule of 7, rule of 5 or rule of 4 gifts at holidays or birthdays).
Here are some ideas to consider based on your financial status and values.
- Contribute to, or open a savings or investment account for childrens’ future education. For birthdays and holidays I give a book, game or sports related item, but I mainly add to their accounts. I also teach older grandchildren about how money grows when invested. My oldest grandson likes owning stocks in companies that he knows (Apple, Starbucks, Target). A $100 invested in these stocks 5 years ago would be worth this today: Apple $388; Starbucks $140; Target $275; S&P 500 mutual fund $167. For older kids who you pay to help with tasks, you can open a ROTH IRA account in which money earned is invested in this non-taxable retirement account.
- Ask select family members or others to contribute to this account, or give gift cards. Fewer physical gifts and more financial gifts can add substantially to the child’s account over time, depending on how the money is invested. Children can also save up some of their money to purchase something of interest or use on a vacation or trip.
- Give an experience or trip. This could include a special day or trip with you that is planned together (or given as a surprise), taking a child to a restaurant, or giving tickets and/or taking the child to a museum, zoo, amusement park, athletic event, concert, or other event.
- Educational, Intellectual gifts. These include books, magazine subscriptions, games that are fun or intellectually challenging in which children learn to think ahead (Checkers, Chess, Pente, Parchisi, other) or puzzles.
- Arts, crafts, building items. The options for children are numerous (arts, crafts, painting supplies, building supplies, legos, other). These encourage creativity, use of their imagination, and cooperation when shared with another child or adult.
- Something personal that you made. This can be in a personal written note, letter or story, something you made (quilt, clothing, painting, vase), a photo album or a framed photo.