Parents spent an average of $422 per child on holiday presents in 2016, according to a survey by T. Rowe Price. An estimated 56 percent of parents with children ages 8 to 14 use credit to purchase gifts, which are bound to include gadgets that’ll be old news by New Year’s but not paid off until months after that.
Indeed, the holiday season — the most wonderful time of the year, as it’s known to some — may be far from wonderful for budgets as some parents try to fulfill every child’s every wish.
A 2016 Experian holiday shopping survey found:
- 56 percent of people said they spend too much money during the holidays.
- 55 percent admitted that they feel stressed about their finances during the holidays.
- 43 percent said the extra expense makes the holidays hard to enjoy.
Some parents overload their children with “stuff” that will quite possibly be obsolete or bested in popularity by the next big thing just in time for the next holiday season. No great mystery that the U.S. has 3.1 percent of the world’s children, but consumes 40 percent of the world’s toys.
“We are a materialistic society, and often our rituals and celebrations reflect this,” says Dr. Mary Gresham, an Atlanta-based psychologist who specializes in financial and clinical psychology. “Many parents get caught up in this and start to believe that the right toy will bring happiness to their child.”
Here are five gifts to give your little ones besides presents this year. Your overflowing closets and pockets may thank you for considering other gift options.
1. The gift of giving
For children, the holiday season can be a “gimme” time of year. But it’s also the time when we often hear that it’s better to give than receive.
Jayne Pearl, a family business and financial parenting expert and co-author of “Kids, Wealth and Consequences: Ensuring a Responsible Financial Future for the Next Generation,” says it’s not hard to nurture a child’s giving spirit. She suggests combating the “gimmes” with the “givvies.”
Put part of your holiday budget toward giving to the less fortunate, perhaps through a charitable organization. For example, you could give a gift in your child’s name to an organization such as UNICEF or the American Red Cross, or to an area animal shelter or humane society.
“Giving kids the tools and the consciousness to try to help people is extremely empowering,” Pearl says.
Her recommendation is to sit down with your children and find out what bothers them about the world, help them figure out how they can help, and make this part of your holiday celebration. Use the holidays as a time to teach your kids that “we have values and our values are not just ‘stuff,’ ” Pearl says.
2. The gift of learning
You know your children better than anyone. And every one of them is unique, with his/her own set of interests, so give a gift that helps a child develop existing or new skills.
Sign them up for classes that help them take their passion or hobby to the next level.
Consider coding camp for your computer whiz or cooking classes for your foodie. You can find classes offered by educational institutions, community organizations, companies or individuals.
You could also take a look at online classes like these from MasterClass, which can help your child hone a craft with a celebrity idol without leaving home.
3. The gift of a financial head start
You can open an online investment account in your child’s name for as little as $50.
And don’t worry if you’re not an expert.
Brendan Mullooly, an investment adviser for an asset management firm in Wall Township, N.J., suggests that novice investors interested in making a financial gift to a young person should use a service like Stockpile, an online company that simplifies the process of gifting stocks to minors.
“You can purchase gift cards of individual stocks and some index ETFs to give as a gift,” says Mullooly.
And Stockpile allows you to buy fractional shares, so the gift cards can be for small amounts. Mullooly recommends setting up view-only access to these custodial accounts so your young investor can check on how the investments are doing.
“This offers a great way to give a gift that’s interesting, has monetary value, and also offers an educational aspect,” he says.
4. The gift of membership
You can’t go wrong with season passes to a favorite destination like a local museum, an amusement park or the zoo. You can use them over and over throughout the year, which could ultimately help your family spend less on entertainment.
Also, check out memberships to national organizations, like the Baseball Hall of Fame for the sports enthusiast.
Or get a pass that’s fun for the whole family, like the $80 America the Beautiful Annual Pass, which pays for itself in as few as five visits to national parks. The pass covers entry to over 2,000 parks for a full year, and nearly 100 percent of sale proceeds goes toward improving and enhancing federal recreation sites.
5. The gift of travel
Pool the money you would spend on toys and trinkets and knock a destination off your family bucket list. You could time the trip to coincide with the holiday season or breaks during the school year.
Erica Steed, 37, allowed her children to choose something they wanted to experience together in Christmas 2016.
Ellison, who was 10, wanted to see the Statue of Liberty. Elian, 7, wanted to see snow, which doesn’t often happen in Georgia. They took a family trip to New York for the holidays, and although it didn’t snow, “we had such a great time that it made up for it,” says Steed, who lives in Roswell, Ga.
When you factor in the cost of airline tickets and lodging in New York City for a family of four during the holidays, this gift option didn’t save the Steeds the money they would’ve spent on presents.
But by planning, creating a budget and sticking to it, the family spent the holidays doing something they could all enjoy and remember for a lifetime. And this, Steed says, amounted to money well spent.
MagnifyMoney is a price comparison and financial education website, founded by former bankers who use their knowledge of how the system works to help you save money.