You can get away with handing out cards drawn with colorful crayons as your go-to gift when you’re young, but when you get older your shopping list grows. As we age, we have more and more relatives and friends that we exchange gifts with, which means more money and more time spent shopping. So, when your loved ones start handing out their lists, it may be a good time to prepare some financially savvy gift ideas for friends and family.
If one of your grandchildren does not yet have a savings account, now might be a great time to open one and start teaching them the importance of saving. Part of your gift could even be a contribution to help start the account, giving them a gift that will keep on giving. You could also purchase stock for your loved ones. This way you can communicate valuable lessons about investing and hopefully watch your gift grow together.
Giving gifts towards college or helping pay off student debt can help your kids or grandkids out financially. Up to $10,000 in 529 plan funds can now be used to pay off student loans, as well as tuition as early as kindergarten. Knowing that you are helping them with some of their financial burden can help brighten the holidays for everyone, and help teach loved ones about the importance of education. Also, you have the power to choose the amount that fits your budget!
It’s the season of giving, and you can give to charity under someone’s name as a gift or encourage them to donate clothes or food to a local shelter. This can be a good option for giving gifts to those who don’t need anything and want to participate in the spirit of giving. There are tax efficient strategies for charitable giving as well, especially in 2020. Another idea is to volunteer together. It’s free to help serve at a soup kitchen or spend time at an animal shelter and can build priceless memories.
Overall, it’s important to plan early for your holiday spending and make smart financial decisions to avoid overspending. Plus, these financially savvy gift ideas for friends and family can cut down on the number of gift ideas you need to generate and time you have to spend shopping. To learn more about how to incorporate charitable donations and giving to loved ones into your tax plan, or using 529 plans for educational expenses, schedule your comprehensive financial review. We can help you figure out a financial plan that works for you.