I am frequently asked for my advice about educating kids (or grandkids) about money.
My wife and I developed a set of “money rules” for our two boys. I thought I would share a few more of them with you. For us, these “money rules” were built around making sure our boys understood the value of money and learning how to manage it.
Buying Stocks for Kids/Grandkids
Every year, well-meaning grandparents ask me how to buy stocks or another investment for their grandchildren. I’m just not a fan of this strategy!
It’s a parent’s (not grandparent’s) responsibility to teach their kids about money and finances. But, I do have some recommendations for other ways you can help your kids or grandkids:
- Send the child a check with the payee blank! Give them instructions to make the check payable to a worthy cause of their choosing! You fill in the dollar amount. They decide which charity gets it.
- Find out what the children saved from their allowance in long-term savings during the past year and match it! You don’t have to match it 100%. You could match it with 25% or 50% of whatever they save on their own. This shows that good habits can be rewarded.
Involve Your Family in Your Charitable Giving
If charitable giving is an important part of your life and a legacy you would like carried on by your family, set up your own donor advised fund. Put your children and grandchildren on the grant committee. Every year you can have a family meeting to discuss what causes the family wants to help. I can’t think of a better “inheritance” for you to leave your family.