It’s hard to believe it but the holiday season is upon us once again! Referred to by many as “the most wonderful time of the year,” the holidays are also often the most expensive time of the year. From hosting holiday soirés to purchasing gifts for everyone on your holiday gift list, it’s easy to see your credit card balance inch higher. For parents of young children, the holidays are an extra special time. The joy on their little faces as you all light the menorah, or unwrap their gifts from Santa, make holiday cookies, or enjoy seeing a play and go ice-skating makes every adult feel warm and fuzzy. The magic around the holidays creates memories that last a lifetime, but it can also stretch your budget in the moment. Because we just can’t help but bring personal finances into the equation, we suggest that this holiday season, you consider giving the children in your life the gift of a healthy financial foundation by teaching them about personal finance and the value of money. Without boring your children to tears, here’s how:
So, What’s Our Budget?
As parents, it’s always important to lead by example, and when it comes to holiday spending it should be no different. Teach your little ones the importance of budgeting by letting them help with the gift buying process for others. You can come up with a list of gift recipients together, set a price limit for each one, and brainstorm ideas that would meet your criteria. You can plan a fun day to go shopping for all of the gifts on the list you made together, taking care to adhere to the budget you set. A tip from us: if you shop only with cash (and only bring enough cash to cover the gifts on your list), it’s easier to demonstrate the value of money and allows your shopping buddy to ensure they are keeping track of the budget. If a present happens to go above your budget, it will have to be taken out of another person’s gift because you only brought enough cash to cover what you brainstormed. This demonstrates the value of money and also shows that there is not an endless supply of it.
‘Tis the Season of Giving
For many, the holiday season is also a time to focus on giving back. Instill these values in your young children by:
1. Choosing an activity to do as a family. This could include volunteering to ring bells for Salvation Army, spending time at a food shelter, collecting coats for a winter coat drive, shopping and delivering Toys for Tots, or any local charitable activity that is of interest to you.
2. Selecting a charity to donate money to. Spend time as a family deciding which charity speaks to you all and what amount feels appropriate for a donation. We suggest allowing everyone in your family to choose an amount to donate, even if that means giving up a few weeks of allowance.
3. When determining the presents that you are gifting together, consider selecting charities and making donations in the names of family members and friends in lieu of giving presents.
There is no denying that spreading cheer by giving and receiving gifts is part of the fun of the holidays, but it’s important to help children to understand that the season should not revolve around presents. Instead, focus on the excitement of activities. After all, activities that you do together will help build stronger relationships and create priceless memories that last a lifetime. This could mean anything from a few simple holiday traditions (baking cookies) to taking on a bigger experience together (hike the mountain you all have had on your list). Here are some from our top hit list:
We also know that presents can come in many different forms. If you are looking for a gift that is a little unique, consider gifting an experience (tickets to a favorite sporting event, concert, play or a cooking class). Show children that the real joy of the season comes from spending time together and spreading kindness. As we think back on our favorite family traditions as children, we are instantly reminded of the times we spent with our loved ones, not the presents that we received over the years. Each of these activities are sure to put a smile on your faces and can be repeated year after year as you start to build your favorite family traditions.
As a parent, guardian, grandparent, aunt, uncle, or role model, one of the best gifts you can give children, regardless of the season, is the gift of a healthy financial foundation. This year, in addition to the gifts you wrap for them, set them up to gain a deeper understanding of the value of money. After all, teaching them to spend wisely and budget is a present that will last much longer than a toy. Interested in continuing the conversation about setting your kids up for financial success? Reach out to the Garrison Point Advisors team!
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