Americans spend an average of $1,000 during the gift-giving season, according to the National Retail Federation. While there’s nothing wrong with the proverbial tie or toy, there are also financial gifts that can literally keep on giving. Certified Financial Planner Paul Fain joins us now with financial gift options for everyone on your list.
THIS IS NON-TRADITIONAL THINKING…GIVE US SOME EXAMPLES OF FINANCIAL GIFTS FOR A CHILD.
- Savings Accounts are a great but simple teaching tool. (principles such as Accumulation, Compound interest, “how to” read a statement)
- Collectible Coins: ex. U.S. Mint. (Gold and silver coins. Follow market value. Go to trade shows.)
WHAT ABOUT FOR A PRE-TEEN?
- College Savings Accounts: 529 plans and investment options.
- Custodial Accounts: ex: Uniform Transfer to Minors account. Can invest in stocks, bonds, mutual funds.
- Child controls account after age 21
- Irrevocable gift
CAN A PARENT OR GRANDPARENT CONTRIBUTE TO A RETIREMENT ACCOUNT FOR A CHILD?
If a child has earned income, such as summer or holiday work, they can receive a contribution up to their earnings:
Retirement Savings tools:
- IRA or Roth
- Custodial guardian for a minor
- Earned income required
ANY OTHER WAYS TO RAISE FINANCIAL LITERACY DURING THE HOLIDAYS?
- Kiva gift card
- Child directs the donation