Have you ever searched the toy stores looking for the latest toys on your niece, nephew, grandchild, or child’s Santa list? If you are able to find the toy, a part is missing; it’s broken or must have batteries. According to the financial management specialist at the University of Florida’s IFAS Cooperative Extension, a better idea is to give a financial-related gift. A gift that teaches the importance of sound financial management can provide valuable lessons that will serve kids for years to come.

Experience is a great teacher when it comes to teaching children about savings and investing. For a school-age child or teenager, one or more shares of stock in a company that makes the “got-to-have” item the child wants can provide a meaningful gift and a valuable education. You can supplement the gift with a lesson on how to track the stock’s performance in the newspaper or on line.

Children can not purchase or own stocks in his or her own name but you can purchase the shares in your name or through a custodial account set up under the Uniform Transfers to Minor Act or Uniform Gift to Minor’s Act. The investment is held in the adult’s name in custody for the child until he or she reaches age the age of majority (18 in Florida).

It may be expensive to purchase less than a round lot (100 shares) in a company, but there are some companies that will sell you their stock directly, that is without a broker, thereby eliminating a brokerage fee. There are also Divide Reinvestment Plans (DRIPS) that permit current stockholders to purchase additional stock from the company without a broker. One Share of Stock, Inc. sells single shares of stock in certificate form that can be framed. There are more than 90 companies listed including companies such as Coca-Cola, Microsoft, Gap and other companies children may know.

Some companies offer mutual funds geared to children. These funds invest in child-friendly companies and send the young investor educational materials that teach them about investing. These plans typically accept lower minimum opening deposits and target long-term growth.

Of course, there are U.S. Savings Bonds. The Series EE Bonds remain one of the safest investments and there is never a fee for buying or redeeming them. Paper bonds may be purchased at half of their face value in denominations as low as $50 and federal income taxes on earnings may be deferred until the savings bond matures or is redeemed. These bonds may be purchased at your local financial institution or on line at the U.S. Savings Bonds website.

You can also find books, videos, and board or computer games that help children learn about savings and investments. Financial management software or a session with a financial planner is an excellent gift for grown or newly married children.

Written by: Dr. Jo Turner, Professor, Family and Consumer Economics

Tight budgets and limited free time can be a source of stress this holiday season. Finding enough money in your budget to make gift giving enjoyable can be a real challenge.

It is possible, however, to cut back on your gift budget and still be a generous gift giver. Remember the old saying "It's the thought that counts, not the price that's paid for the gift."

Don't wait until the last minute when stores are crowded to do your Christmas shopping, when everyone else seems to be shopping. Most department stores make about 25 percent of their annual sales between Thanksgiving and Christmas.

Plan ahead, so that you have time to enjoy the traditional pleasures of the Christmas season. Some ideas to trim gift-giving expenses follow:

• Make a Christmas gift list with names, gift ideas and price estimates. Next total the amount you plan to spend. If this figure is more than you can afford, you will need to make some changes.
• List several alternatives for each name on your list, then look for sales in the price range you can afford. Most important -- stick with your plan.
• Check sales for gift items. See newspaper ads and store circulars for gifts you are considering. See which stores are running specials and shop where prices are lowest. Keep in mind that during November and December, prices are normally reduced on a number of items, including children's clothing, women's coats, shoes, slippers, men's clothing, resort and cruise wear, blankets, table linens, party goods, and appliances such as radios, toasters, stereos and televisions.
• Don't rush into a purchase because of an advertised claim of a low price. Know what the regular price is before buying an on-sale item. Often one store's sale price is another's regular price.
• Shop different types of stores to compare prices. Look at discount stores, catalog showrooms, factory outlets, as well as department stores.
• Be sure to keep receipts of credit purchases and total the expenditures at regular intervals to make sure you stay within the limits of your Christmas spending plan. Also check and keep receipts. If mistakes occur you will need the receipt to help in correcting errors.

If you do feel stressed, avoid last minute shopping. It leads to not only fatigue but also overspending and often making poor selections. For more information on managing on a budget contact your local county Extension office.

Dr. Jo Turner, Professor, Family and Consumer Economics