Holiday season is just around the corner, the best occasion to send and receive meaningful gifts and be grateful for your loved ones.
A holiday can’t just be centred on eating good food. We need to reflect on everything we’re thankful for, and expressing gratitude to our loved ones should be at the top of that list. But presents should be wider than an ill-fitted sweater, coat, scented candles, or spa set.
Financial gifts might not come to your mind when you think of gifts, but today I want to say, let’s normalise buying assets for the holidays!
Financial products can kick off someone’s financial journey, liberate them of their crippling debts, help them set up a financially-free future, or at least, motivate them to become financially literate.
Keep reading to find out 6 holiday gift ideas that keep on giving well after the holidays.
Although financial gifts can be a tad difficult to wrap (pun intended), they are more valuable and keep giving well in the long run.
Savings bonds make distinctive and valuable gifts that can help the receiver with school loan repayment or a rainy-day fund. Treasury Bonds can be given as gifts in two varieties: EE savings bonds and I savings bonds. If the recipient intends to cash in the bonds after 20 years, EE bonds are preferable; saves are preferable for less than 20 years.
Savings bonds are “non-marketable,” meaning they cannot be traded on a secondary market. The payment you make for a savings bond reflects a debt to the United States government.
The savings bond earns interest for up to 30 years in exchange for the loan. After one year, the bond is redeemable for its face value (plus any interest received) at any time. The last three months of interest are forfeited if the bond is redeemed before the five year period.
Buying stocks makes you a part owner of the company. What better gift to your loved ones? You can gift stocks by transferring existing equities or acquiring individual shares from an online brokerage that allows stock gifting.
If you utilize a broker to gift stocks, the recipient must have an account where the stocks can be received. Some brokers allow you to fill out an online form with information on the sender and the recipient. It is also feasible to schedule a regular transfer to gift stock.
You can give a stock share as a virtual gift. Some websites allow you to buy a share and redeem it for friends or relatives. This is an option to avoid buying and transferring the shares. The recipient can either sell the stock and keep the proceeds or use the proceeds to purchase shares of a different stock.
Why not encourage your present receiver by investing some money in their potentially profitable business idea? You may do this by providing them with funds or acquiring some of the required instruments.
For example, if your friend wants to start selling fantastic cakes on a small scale but needs a larger oven, you may assist them by purchasing an oven. All you need to do is explore the business idea and think what might be of use to them.
This gesture may help your receiver secure a stable source of income in the future. It could also be a wise financial move if you and the recipient agree that your gift can be considered an investment in the business and thus you become entitled to a portion of its revenues.
Keep in mind that cryptocurrency is a high-risk, high-reward investment. However, if your present recipient is a seasoned NFT-collecting ETH-head or HODLing dogecoins for the lolz, or is truly into crypto, this could be a nice way to share in their pastime.
Cryptocurrency is a novel financial gift idea. There are many other coin options, such as Bitcoin and Ethereum, and you can even purchase digital assets using platforms such as PayPal and Venmo and trade them using apps such as Robinhood.
For tax reasons, cryptocurrency is classified as property and is taxed similarly to other common assets, such as stocks. You would have to pay taxes if you earned a profit selling cryptocurrency.
However, if the sum exceeds the $16,000 gift tax allowance, you can avoid paying taxes on crypto gifts.
A Roth IRA can be a great option if you’re getting a financial present for a youngster under the age of 18 who is earning money. Roth IRAs provide tax-free growth. Because the minor is likely to be in a low tax bracket, paying tax rates now is likely to be lower than paying tax rates while receiving distributions in the future.
For 2022, your total annual contributions to your Roth IRAs and regular IRAs cannot exceed $6,000 (or $7,000 if you are 50 or older). You cannot contribute more to a child’s Roth IRA than they earn in a year. However, if you are a parent who owns a small business, hiring your child in the business allows them to make Roth contributions, which you can make on their behalf.
Making yourself and your loved ones invest in financial courses can be worth more than the value of a monetary gift. Financial literacy is beneficial and necessary to achieve financial freedom.
For this reason, I’m offering an investment course to help you create a roadmap to get you from where you are now to that $1M net worth.
Join the Netwherk Wealth Society’s circle community to get access to my investing video course and to get in touch with people building their net worth like you. The course comes with exclusive calls and interactive sessions to give you that extra nudge.
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This holiday season give yourself and your friends the gift of learning. Subscribe to Netwherk Wealth Society.
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Lesson 1: Foundations of Money Success
Lesson 2: Where are you now
Lesson 3: Dreaming Big
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See you all with your friends on the course!
It isn’t easy to come up with a suitable holiday gift. But with the crazy inflation, almost everyone will appreciate financial presents — and you won’t have to worry about purchasing the incorrect size. Keep in mind that, beginning in 2022, any donation above $16,000 per year per individual may be subject to a federal gift tax. This amount will increase to $17,000 per person per year in 2023.
Other than that, Happy gifting!