Are you looking for creative gifts that go beyond the typical toys or gadgets? Many families are opting for gifts that offer lasting value, presents that help children, grandchildren, or even friends learn about money management and provide a head start on building a foundation for their financial future.
Below is a list of financial gifts I’ve put together that can provide valuable lessons for the younger generation and set them up for long-term success.
1. Set Up a Roth IRA
The first gift that comes to mind is a Roth IRA. Children of any age who have worked and received a W-2 or 1099 income from employment can fund a Roth IRA and build tax-free savings for their future.
By opening a Roth IRA for them, you can help them build a strong financial foundation early in life. Contributions grow tax-deferred meaning that there could potentially be substantial long-term financial gains.
To open a custodial Roth IRA for minors, you must specify a custodian who can oversee the account until the beneficiary reaches the age of maturity. Select a custodian who shares your investment philosophy because that person provides guidance and support to the beneficiary.
Opening a Roth IRA at a young age can help them form a strong savings habit and be positioned for a solid financial future.
2. Buy Stock in a Kid-Friendly Company
Another smart financial gift for kids is buying stock in a kid-friendly company.
A fun and instructive way to introduce kids to investing is to buy stock in a publicly traded company that caters to their interests, such as Disney or Mattel. Owning a portion of a well-known business allows children to gain knowledge about the stock market, corporate profits, and dividends.
Interest in their investment usually rises and falls in tandem with the company’s stock performance. It’s crucial to keep in mind that stock investing entails risk and the investment’s value can fluctuate.
Giving them equity in a business that interests them sparks their interest in finance and business. Children can also learn the value of patience and long-term planning by watching how their investment performs over time.
3. Contribute to a 529 Savings Plan
A 529 savings plan is a tax-advantaged plan designed to promote saving for future education expenses. By making contributions to a 529 plan, you can help your child or grandchild save for graduate school, college, or any other eligible educational costs. The growth in the account accumulates tax-deferred, and withdrawals for qualified expenses are tax-free.
Opening a 529 account is a fairly straightforward process. Many states provide their own 529 programs with a variety of investment options. You have the choice of setting up automatic monthly contributions or making a one-time payment. Gifting a 529 plan provides the opportunity to lessen the financial burden of higher education and help your loved ones reach their educational goals with tax-advantaged growth potential.
4. Open and Contribute to a Custodial Investment Account
Introducing a child to the concept of long-term compound growth and the virtue of investing patience is a valuable and enduring gift. If, despite the tax advantage, a Roth IRA or 529 account doesn’t suit your needs due to their specific rules, consider setting up a taxable custodial account in their name and making regular contributions. Investing in low-cost broad market indices like the S&P 500 or Nasdaq 100 can provide a practical learning tool while simplifying the choice of investment, offering insights into market fluctuations and the power of compound growth over time. Additionally, contributions to the account aren’t limited to just you—others can contribute as well, with no annual contribution caps.
It’s important to stay mindful of the tax implications for custodial accounts. For 2025, the first $1,350 in earnings is generally tax-exempt at the federal level, while the next $1,350 may be taxed at the child’s rate. Any earnings beyond $2,700 are taxed at the parent’s rate. Also, keep in mind that assets in custodial accounts are considered the child’s assets in financial aid calculations.
Collaborate With a Trusted Advisor
Investing in a child’s future through thoughtful, financially driven gifts can create lasting benefits for generations to come. By introducing younger family members to important financial principles such as investing, compound growth, tax advantages, and saving, you’re offering more than just a present: you’re giving them the tools for long-term financial success.
At Wilkinson Wealth Management, we are dedicated to helping families build lasting legacies through personalized advice and long-term relationships. Our approach aligns your financial decisions with your family’s unique goals, empowering future generations with the confidence to manage their finances wisely.
Are you looking to explore financial gifts that make a lasting impact? Reach out to us at 434-202-2521 or use our Contact Us page to schedule an appointment and see how we can collaborate on creating a strategy that sets your loved ones up for success.
About Bryan
Bryan Strickland is a financial advisor and CERTIFIED FINANCIAL PLANNER® professional at Wilkinson Wealth Management, a financial services firm of CFPs in Charlottesville, Virginia, providing customized financial planning and Investment strategies with a personal approach. Bryan uses his 20-plus years of experience to help his clients navigate the complexities of their financial situation so they can look to the future with clarity and confidence. He strives to get to know his clients—what matters to them, their concerns, dreams, and goals—so that he can design a personalized and tailored plan to get them from point A to point B and walk with them through whatever life throws their way.
Bryan started his career as a project engineer and project manager after earning a degree in
civil engineering from the University of Virginia. He then made a career change to pursue his true passion of serving others through personal financial planning that puts the client first. Outside of work, Bryan loves spending time with his wife, Nicole, and their three children, Tyler, Izzy, and Brendan. You can also find him on the field as a volunteer coach for a local travel soccer team. He enjoys singing and participating in most sports, including soccer, triathlons, and obstacle course racing. To learn more about Bryan, connect with him on LinkedIn.
This article was prepared for Bryan Strickland’s use.