How do I give my child money for Christmas?

Quick answers

Here are some quick answers to common questions about giving children money for Christmas:

Should I give my child cash or a gift card?

Either cash or a gift card are good options. Cash gives them more flexibility, while a gift card teaches them to budget for a specific store or activity.

What denomination of cash should I give?

$10 or $20 bills are good denominations for children. Avoid giving coins which could get lost.

What type of gift card is best?

Visa or Mastercard gift cards can be used anywhere. Store gift cards for their favorite clothing or hobby store also work well.

How much should I give?

Base the amount on your child’s age. $30-50 for toddlers, $50-100 for elementary school kids, and $100-200 for teens is reasonable.

Should I give cash gifts to all my kids?

Try to keep it equal among siblings to avoid hurt feelings. Consider giving smaller kids a gift card and older ones cash.

When to Give Money Gifts

The holiday season is the most traditional time for giving children monetary gifts. Here are some other occasions to consider:

Birthdays

Like holiday gifts, giving money for birthdays teaches kids to save and budget. Scale the amount based on their age and maturity level.

Good Behavior Rewards

Money can motivate good behavior like completing chores or getting good grades. Give a small cash reward immediately after the desired behavior.

Starting a First Job

When your child starts their first job like a paper route or dog walking, give them an extra monetary gift. This will reinforce their newfound responsibility.

Graduations

Graduations from preschool, elementary, middle, and high school are big milestones. Give money gifts in cards to recognize their achievement.

How Much Money is Appropriate

The amount you give will depend on your child’s age, maturity level, and the occasion. Here are some recommended guidelines:

Age Holidays Birthdays Good Behavior First Job Graduations
1-2 years $20-30 $10-20 $1-5 N/A N/A
3-5 years $30-50 $20-30 $5-10 N/A $50
6-10 years $50-100 $30-50 $10-20 $20 $100
11-14 years $100-200 $50-100 $20-50 $50 $200
15-18 years $150-300 $100-200 $50-100 $100 $300

As children get older, you can give them incrementally larger amounts. Just make sure to set reasonable expectations – don’t give a 16-year-old $500 without discussing saving and budgeting.

Gift Giving Guidelines

Follow these general guidelines when giving children money gifts:

Cash or Gift Card

For young kids, stick with gift cards so they learn to budget a set amount. Older, more responsible kids can handle cash.

Equal Value

Try to keep monetary gifts equal between siblings to prevent jealousy or hurt feelings.

Have a Conversation

Discuss the gift with your child – how much it is, what it’s for, and options for saving/spending. Make it a learning experience.

Combine with a Card

Put the cash or gift card inside a greeting card and write a heartfelt message. This makes the gift more meaningful and memorable.

Set Expectations

Be clear if any strings are attached, like putting some in savings. Don’t give unexpectedly large amounts without this discussion.

Consider Interests

Gift cards can cater to a child’s interests, like a bookstore gift card for an avid reader.

Teaching Money Management

Giving children monetary gifts is also an opportunity to teach important money management skills like budgeting, saving, and smart spending. Here are some tips for getting started:

Help Them Set Savings Goals

Encourage your child to save a portion of monetary gifts for short and long-term goals. Match their contributions for motivation.

Explain Budgeting

Help kids plan how they’ll use a gift card or cash within a budget. Break spending down into categories like needs vs wants.

Show Them How to Shop Smart

Show kids how comparison shopping, using coupons, and buying store brands can make money go further. Shop with them and point out these habits.

Let Them Make Mistakes

Within reason, don’t bail kids out if they overspend gift money. Experiencing small negative consequences now teaches self-control.

Discuss Charitable Giving

Consider having kids use a portion of money gifts to donate to a charity. This teaches altruism and social responsibility.

Creative Ways to Give Money Gifts

Looking for creative ways to give kids monetary gifts? Here are some fun presentation ideas:

Scavenger Hunt

Hide cash or gift cards around the house and give clues leading your child to the money. Build excitement and get them moving.

Piggy Bank

Fill a piggy bank with coins or hide cash and gift cards inside. Let them smash it open to discover the surprises.

Envelope Puzzle

Tape envelopes together that must be opened in sequence. Put puzzles, jokes or clues inside leading to the final money gift.

Giant Greeting Card

Make or buy an oversized card and fill it with smaller gift card envelopes. Decorate it with their hobbies and interests.

Money Cake

Bake a cake and hide money gifts inside – even make it look like a stack of bills. Just be sure to remove cash before cutting and eating!

Talking to Your Child About Money Gifts

The way you talk to your child about monetary gifts can have a big impact on what they learn. Here are some communication tips:

Explain Where Money Comes From

Giving a gift is a good time to start explaining that you have to work hard at your job to earn money to provide for their wants and needs.

Teach Thankfulness

Require your child write thank you notes or call relatives to say thanks for monetary gifts. This teaches gratitude and giving back.

Have Them Make a Plan

Ask kids to write a plan for their money gift – how much they’ll save, spend and share. Help them follow through after the holidays.

Discuss Wants vs. Needs

Talk through how monetary gifts can be used to buy wants like toys or experiences, along with needs like new shoes or clothes.

Set a Good Example

Make sure your own spending models smart money management. Kids notice your saving, budgeting and generosity.

Potential Drawbacks

While monetary gifts have many benefits, there are a few potential drawbacks to consider:

Lost Sense of Surprise

Always giving money gifts could lead to kids expecting them. Occasionally surprising kids with an experiential or personalized gift can be more meaningful.

Perceived Laziness

Some kids or family members may see money as the “easy way out” compared to a thoughtful, handpicked gift. Make sure to combine with a card and wrap the cash or gift card creatively.

Added Responsibility

For younger kids, money gifts add the responsibility of keeping cash secure and not losing gift cards. Consider their age and maturity first.

Inflated Expectations

Be cautious not to give extremely extravagant monetary gifts that children come to expect annually. Keep amounts reasonable.

Added Stress

Holiday expectations around money gifts could cause financial stress for parents or family members. Set realistic limits you can maintain annually.

Safety Tips

Here are some tips to keep safety in mind when giving kids monetary gifts:

Don’t keep large amounts of cash at home

Only withdraw what you plan to give as gifts to avoid theft risks. Keep leftover cash in the bank.

Store cash and gift cards securely

Use a lockbox or safe place out of sight until time to give the gift. Don’t risk misplacing envelopes of cash.

Register gift cards

Record gift card numbers and register cards in your name when possible in case they are lost or stolen.

Consider digital money transfers

Apps like Venmo, PayPal or Google Wallet allow contactless digital money gifts to older kids’ accounts.

Take time to discuss stranger danger

Remind children never to carry excessive cash publicly or tell strangers about money gifts they received.

Teach them to be discreet

Explain that it’s unwise to go flashing cash publicly or leaving it lying out where friends can see.

Set rules for safekeeping

Have kids check in gift cards with you for safekeeping. Agree on rules for carrying cash amounts.

Fun Alternatives

While monetary gifts have many benefits, giving cash or gift cards every holiday could get repetitive. Here are some fun alternatives to mix things up:

Experience Gifts

Give tickets to children’s museums, zoos, movies, concerts or parks. These create special memories.

Charitable Donations

Make a donation to a charity your child cares about in their name. Teach giving back.

Subscriptions

Give a monthly subscription box matched to their hobbies or interests that provides joy all year.

Lessons

Give the gift of learning by paying for lessons like horseback riding, skiing, art or coding classes.

Savings Bonds

Instead of cash, give savings bonds that encourage long-term saving and show the magic of compound interest.

Conclusion

Giving monetary gifts is a thoughtful way to enable children to select their own personalized gifts while teaching valuable money skills. The amount you give will depend on the child’s age, maturity and the occasion. Combine cash or gift cards with a handwritten card and creative presentation for a meaningful gift. Discuss the gift amount and have kids plan savings and spending to make it an educational experience. With some guidance, money gifts this holiday season can lead to smart money management practices that will benefit kids for years to come.

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