As a kid growing up I remember going to the Christmas Tree farm and picking up a tree with my family. It was a special time of year.
Stuffing the tree into the back of our minivan, us kids would squeeze in nice of tight with the prickly branches, breathing in the sweet and musky scent of tree, up close and personal.
Every day for almost a month I remember shuffling under the Christmas tree in my pj's looking at the name tags on all the boxes. They were all boxes of chocolates for other people.
We had a lot of nooks and crannies in the house where I would guess my parents hid the presents, but I never found them. They would always magically appear on Christmas.
The thing about presents was that it didn't really matter how many I got or what I got. I really can't tell you that I still use anything or even have any of the presents I received all those years ago.
When I think about all those Christmas' I don't remember any of the presents. I only remember the feelings. And they were wonderful feelings. Definitely "worth it".
4 Worth It Christmas (Present?) Ideas:
Full disclosure, some of these are not "what to get" ideas.
1. Don't Force Your Interests Or Ideals (too much)
Kids should still be kids. Get something that matches their interests. Don't force something from left field on them.
A few years ago, I got my nephew a jigsaw puzzle of the solar system. I thought it was pretty amazing and would teach him patience, blah blah blah. I'm pretty sure it's never been opened.
My niece is really into art these days. She's four and a half years old. She mostly paints so her parents have her decked out when it comes to painting stuff.
This year, I took a tangent of her interest in art and got her a 100-page blank sketchbook with a set of sketching pencils and coloured pencils.
I honestly don't know if she will use it or like it, but if art is something that continuously interests her, it may someday be used to develop her blossoming artwork.
2. Too Many Presents = Junk
Many parents I know have told me their kids get tooooooooo many presents at Christmas. They have too much junk around the house now, they don't know what to do with it all.
The kids play with some toys for a few minutes and then go and open the next present and forget about the first one completely.
My cousin has a great trick. She asks for gift receipts.
Once the kids open all the presents either the kids choose what they want to keep, or the parents "quietly remove" the presents their kids don't seem interested in. She then returns the "forgotten ones" for store credit.
This is a great tactic to reduce the clutter of junk in the house that will never be used.
Bonus: The presents you can't return (and will never be used), you can donate. One person's junk is another person's treasure.
If the kid hasn't had a good lesson in how to save money and how money works, this is a good opportunity to get the ball rolling.
Don't expect it to go smoothly though, every kid learns at their own pace and may not have the attention or interest to learn yet. But this is something to be persistent with as they age.
There are many ways to go about it, but I suggest having a private-ish setting so that you have a chance to ask the child what their hopes and dreams are.
Most children don't have a concept about money. They don't know that their dreams cost money to make come true with classes and materials.
Ask the child how much it will cost to do all the things they dream about and how they will pay for it. Help them figure out how much things cost.
That's when you give the child the money. Take it out of an envelope with their name on it. Count it with them. And tell them that this gift is for them, they can save it or spend it however they choose. But make it clear that they should spend this money for their dreams. That's what this money is for.
This is personal development money. Kids don't need to save money for retirement. They need to save to spend on "what they want to be when they grow up".
If you've already had this talk, then "straight cash" in an envelope is great.
This is also a good time to help them open a bank account. Getting familiar with the bank system is important to develop a foundation around saving in the long-term.
This is kind of like giving money, but it teaches a different lesson.
Giving an investment teaches a child that money has more use than just to buy things or experiences. And that saving money can result in having more money in the future.
My family is very big. My parents are both the youngest of 9 children in their families, and I am the youngest in my family. This makes me the youngest cousin in a long line of cousins the oldest being about 50 years older than me.
Many many years ago, when I was in elementary school, I remember my oldest cousin brought me and my brother to the Royal Bank of Canada. She wanted to give us a gift of money, but she wanted to teach us a lesson on saving as well.
At the time, our parents had already opened bank accounts for us, so this visit to the bank was not our first.
We went to the teller and I distinctly remember the poster advertising the Canada Savings Bond. I recall it said something like "save for 1 year and get 3% interest, keep it for 2 years and get 3.5% interest ..... and keep it for 5 years and get 5% interest". Compared to the 1 cent I was getting printed on my bank book, 5% sounded amazing.
My cousin was there to cash out a bond she had held with the Canadian government for 20 years!! This was a monumental experience for my brother and I, that I still remember where I was standing when it happened over 20 years ago. The amount interest my cousin got was more than a child that age knows how to count.
I don't know if that moment made me a saver, but it sure didn't make me a spender.
With interest rates at such low rates, it's hard to teach kids about the power of saving and investing.
But don't be discouraged.
Start with a regular bank account at a big bank with a branch, then graduate up to an online banking account with high interest. Look for promotional interest rates to get your kid started.
My regular bank account is earning 1% interest. But my Tangerine bank account is earning a special promotional interest rate of 2.75% until the end of December.
These kinds of promotions on guaranteed investments (like savings accounts) is a good place to start showing kids how savings can become investing and the difference between interest rates.
What gifts are you getting for the kids in your life this year?
Save Money Retire Early is written by Jon Lo, a barely 30 something change optimist, and personal finance guy. I believe anyone can be rich or poor, it's what you save that makes the difference.