Updated 12/17/2023
A few years ago, I was playing with my then 4 year old daughter. She had a toy cash register and was charging me an insane amount of money for a plastic cup cake. That moment gave me the idea to write this post. My wife and I spoke to her about the concept of money and why we have to work. She is still having trouble understanding the term “expensive”. She probably gets that from my wife. After doing some research, I came up with 7 Financial Gift Ideas for Children.
- Piggy Bank – The Piggy Bank is an important way to teach children how to save. You can use it in combination with an allowance and chores to teach your children how to earn money. My daughter’s chores do not come cheap. She charges me $11 for cleaning up her room.
- Monopoly – The board game Monopoly is a great way to spend hours teaching your kids about money. This popular board game will help teach budgeting, investing, and banking.
- Wallet – As your children go out with friends, it may be time to consider giving them a wallet or purse to hold their ID and money. This will help teach them to keep their money (and wallet) in a safe place.
- 529 Account – The 529 is a triple-tax-advantaged education savings plan offered by each state. You can even get 529’s from certain brokerages like Wealthfront. Join Wealthfront here to get your first $5000 managed free. Your tax-deductible contributions grow tax free and can be withdrawn tax free if used for qualified educational expenses such as private school, college, text books, software, and on-campus housing.
- Custodial Account – A custodial account is an investment account for your children. You can invest in this account for them and give them access when they are 18 years old. Depending on the brokerage, you may invest in stocks, ETF’s, and bonds. M1 Finance currently offers a custodial account geared towards long term investing. Join M1 Finance here.
- Savings Account – Many parents like to open a checking or savings account for their children. This is a great way to teach your kids how to write their own checks and deposit their own money. They can’t withdraw their money until they are 18, but they can still learn how to save with their account. Yotta Savings, a lottery based savings account, is currently offering a promotion where you can gift a savings account (with money) to a friend or family member. In this promotion, both you and the person receiving the gift get bonus lottery tickets. If you are interested, sign up with Yotta Savings and Use Code HYDERFT to get extra bonus tickets.
- Bond and CD’s – Bonds and Certificate of Deposits are long term investments that hold your cash for 1, 2, 3, 5, or even 10 years. They allow the government to borrow money from you and pay you back with interest. Since your children don’t need the money yet, consider a bond or CD for the potential to earn more interest.
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