Holiday Gifts Your Kids Can Really Use

11/24/2011 10:30 am EST

Focus: MONEY MANAGEMENT

Terry Savage

Author, The Savage Truth on Money

These gift ideas, some free and none more than about $20, will pay dividends many times over as your children grow into sensible savers and spenders, writes MoneyShow.com personal finance expert Terry Savage.

The most delightful part of the holiday shopping rush is the chance to give meaningful gifts to children and grandchildren. And the Internet makes that easier than ever—if you order now, to beat the holiday rush.

So here are a few ideas to help you get started on finding a gift that won’t be broken, worn out, or tossed aside within days. Instead, these gifts will continue to give through the financial lessons they teach.

Sesame Street Money Videos
New this year, and at the top of my list, is a new and terrific—and free—program aimed at teaching kids about money. For Me, for You, for Later: An Early Start to Spending, Sharing, and Saving was developed by Sesame Workshop, the nonprofit educational organization behind Sesame Street.

PNC Bank is sponsoring the program, offering a free DVD in both English and Spanish. The videos, starring Elmo, can also be accessed online at the link above, complete with activities for parents and children.

Check out the videos, including “Elmo Makes a Choice” and “Elmo’s Savings Jar.” They’re a great activity for parents and children. You can even download a parents’ activity guide and labels for those savings jars.

MoneySavvy Piggy Bank
This is my all-time favorite gift for children starting at age 3, and useful even for pre-teens (for whom you might want to “pre-load” some money!

This four-chambered, see-through, plastic piggy bank, offered for $16.99, is clearly marked with four categories: SAVE, SPEND, DONATE, and INVEST. It’s a graphic and compelling early lesson about the choices to be made with money.

Order the coloring and activity book for an additional $2.75 to complete the gift. And, if you’re looking for the perfect baby gift—coins certainly not recommended—there’s a platinum plastic version that can sit on the top shelf.

NEXT: 3 More Gifts

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Sharebuilder.com
I’m frequently asked about how to buy a few shares of stock for a child or grandchild, without paying more in commission than the value of the shares.

So another perennial favorite of mine is Sharebulder.com, which is designed to allow you to buy just a few shares, or a fixed dollar amount (resulting in less than a full share), for a fee of only $4. You can choose from more than 7,000 stocks or ETFs, and more than 250 no-load mutual funds.

This company, a division of ING Direct, specializes in getting people started on an investment program.

Check out the special deal for children, called “The Gift of Stock." The $30 price includes a $50 Sharebuilder gift certificate, and the Motley Fool video series on choosing stocks.

Young children won’t miss the fact that they don’t get a paper certificate, since everything they do is electronic anyway. And you can add to the gift every year. There are no account or investment minimums, and no inactivity fees—making this a gift for potential investors of any age!

Collectors Coins (Money.org and Mint.gov)
If your child or grandchild has started to collect Barbie dolls or Hot Wheels or video games, you might turn their attention to collecting something that has real value, teaches lessons about history, and gives them an interest in current events.

It’s easy to start collecting coins—and even with high prices for gold and silver, you can get started with small amounts of money.

Money.org is the Web site of the American Numismatic Association, and will help you locate reliable member dealers. Or go directly to www.USMint.gov.

You can start with “common” but interesting items, such as the Presidential $1 coins (four are issued each year). Especially interesting to young girls is the First Spouse collection, which comes in expensive half-ounce gold pieces or less expensive, but equally interesting bronze medallions.

All teach a great lesson in history, and you can sign up for a regular program of collecting as new coins and medallions are introduced.

Money Safes (Amazon.com)
How do you turn spenders into savers? By getting them to actually keep their money safe!

Sometimes a bank account is a bit too abstract, so check out the wide variety of small safes offered on Amazon.com. Most retail for under $20, and feature a simple lock that keeps money and other valuables safe from brothers and sisters. Search under “kids money safe.”

There is even one version that is a science project—Alarmed Money Safe Money Bank by Kidz Labs Spy Science—that allows a child to actually “build” the safe and even connect it to a “buzz-alarm” circuit.

And while you’re at Amazon, check out the “Money Maze Bank Puzzle” for under $10. That will certainly keep their attention focused on the cash gift you place inside. Or look at the Learning Resources “Cash N’ Carry Wallet” for $7, a starter kit for keeping your money organized in pocket or purse.

Any and all of these gifts will get young people off to a good start with money and personal finances—a gift that will serve them well through their entire life. And that’s The Savage Truth.