Every year at this time, I write a column about gifts that teach children about money. While the latest toys, dolls and electronics may capture their brief attention spans, the gifts described below will provide far more meaning in the long run.
—The Money Savvy Pig. This translucent plastic, old-fashioned piggy bank is my all-time favorite for younger children. The bank has four chambers, one each for Save, Spend, Donate and Invest. If you have several grandchildren, you can order in different colors. It costs $19.95 at www.moneysavvy.com and will start your children on the way to good money habits.
Plus, while you’re at this website, look over the gifts for older children, including the OMG (Official Money Guide) books for teens and a more advanced and helpful version for college students ($12.95 each). And look at the money games kit for preschoolers for $24.95.
—Stock shares. What better way to get a young person interested in the stock market than to help them become an owner of a few shares of stock in a company whose products they use, such as Microsoft, Nike, Apple or Amazon? Start at Stockpile.com, where you can charge a stock gift to your credit card and allow the recipient to choose which company or ETF to buy. Minimum investment is $5.00, and you can buy fractional shares at a cost of 99 cents per transaction. (Warning: At the age of majority — 18 in most states — this account becomes the sole property of the child! And assets in a child’s name weigh more heavily against the family in the financial aid formulas.)
—College savings. Here’s a gift that won’t be appreciated for years — but by then it will most likely have appreciated greatly. Open or contribute to a 529 College Savings Account for your child or grandchild so the money can grow tax-free for college expenses. Some states offer tax deductions for contributions, but you can invest in any state’s plan — and your child or grandchild can use the money for college in any state. Search for your state’s plan — and for the best-performing plans — at SavingforCollege.com.
—Money apps. Our kids lead online lives, so let’s help put some on-screen time to good use. The Allowance and Chores Bot ($2.99 at the App Store) keeps track of tasks and rewards for several children. Kids watch their accumulating allowance balances, as well as completed tasks, avoiding arguments over what was done and what is owed.
The Money Professor is a free app that teaches younger kids how to count coins and build up virtual savings accounts. The Cash Register Toy app ($1.99) shows kids how to make change at a store (which deals with my personal pet peeve: teen store clerks who have no idea how to do that simple math).
—Parent-controlled debit card for kids. While we are accepting the inevitable use of technology by our children, here’s a chance for parents to both enable and control the process of handling money and spending. The Greenlight Debit Card for Kids is a debit card that works with an app. It allows parents to automatically transfer money to a debit card while limiting the stores at which it can be used. You can pay allowances or get emergency money to your children instantly. It alerts you when the card is used — and you can turn it off with a click, as well as analyze spending habits and teach about budgeting and spending limits. It costs $4.99 a month for the entire family.
Finally, I once again recommend reading Ron Lieber’s excellent book, “The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money.” What good is it to raise money smart kids without some perspective about the role of money in their lives? It’s best to start early. And that’s The Savage Truth.