Personal Finance Friday - Santa can give Stocks instead of Toys!
As Christmas is only 2 and half months away, and I'm a Christmas person, I thought I'd throw this post out there.
Everyone likes to get kids things for Christmas. Christmas is the fun holiday it is because of gift aspect (in my opinion), and it seems the most joy comes from giving a kid something they really like. So needless to say in our very wealthy nation, kids get a TON of stuff for Christmas. Our kids in particular get a TON... maybe a literally a ton :)... of stuff. So much so that Andrea and I are actually pretty sparse (lower count, higher value) on our gifts because we know the kids are going to get a bunch of stuff. Over the years I've thought about all the money that gets spent on kids in this country, of which a large chunk gets thrown away or given away eventually. Man can you imagine if some of that money was invested for the kids? Each kid in American has $500 - $1000 spent on them each year by their parents and relatives. What if half of that was saved instead of spent? If you assumed an 8% return that kid would have $10,000 to $20,000 available to them when they went off to college?!
But you say, "They would only get half the gifts!!!" ya but do you think its actually going to matter to them in the end? That is still a whole lot of presents they will get over that time. They may even be better off not receiving all of that extra stuff.
Honestly, I know that people won't change, but it is still interesting to think about. That being said, the reason I am writing this post is because I saw a product that I thought was super cool and wanted to share! This was an idea that I had a while ago, and as with all great ideas we all have, just didn't do anything about :), but I'm seriously glad someone actually went ahead and did it!
You can buy gift cards of stocks! You can give it to people, and they can redeem them in a brokerage account app! So cool! (at least for investment nerd like me). Also, you can give this to kids and their parents can set up a custodian account for their kids. One, what a great way to give a present, and also savings all at the same time. Also what a great way to start teaching your kids, nephews, nieces, grand kids, friends kids, etc about investing! Shoot for some parents it might be a great lesson for them as well.
I have not tested this product yet, but I think I might give my kids something this year and open accounts for them and see how it goes. I'll do another post to tell you how it goes. If you try it let me know!