Financial gifting to grandchildren
Terry, I have 4 great grandchildren and would like to gift each one $50 on their birthdays.
I thought about a savings bond that I could add to yearly. I understand that I’m unable to purchase a bond at my bank. What is the best and easiest way to accomplish this and is this the best alternative for gifting small amounts of money?
Terry Says
Well, that depends on how you want them to use the money. If you just want to give them spending money, then go to the bank and get a $50 bill for each of them. It will take them a bit of thinking to “break” the bill, so maybe they will save it!
If you want to start gifting money to grow for college, then open a 529 College Savings Plan.
In Illinois, it’s the BrightStart plan.
Read this to understand how these plans work: https://www.terrysavage.com/the-gift-of-college-529-plans/
And if you want to teach them how to invest, go to this website: https://www.teenvestor.com/
Then introduce them to Charles Schwab’s SLICES program, where they can invest as little as $5 in a stock that interests them.
