Why You Should Give the Gift of Investments This Year
So real talk. I’ve been a bit of a Scrooge this year. I can’t point to one precise reason for this holiday mindset, but I have a sneaking suspicion it’s due to jumping in headfirst into the beautiful world of finance with Nav.it.
Don’t get me wrong, I would rather be Scrooge-like than without you all for any and all holidays now and forever. That said, I’ve been agonizing over gifting this year (though here’s how you can give without breaking the bank). Why on Earth have we devoted an entire season to gift-giving when we should ultimately be after spending time with friends, family, and enjoying far too much (spiked) eggnog under an immaculately decorated tree (more on my OCD tree tendencies later..)???
For fear of familial ex-communication, I hopped on the post-Turkey Day bandwagon and ordered the “necessities” for a family obsessed with gifting. (It’s like an Olympic sport for these people.) Which now begs the question: what does Ms. Scrooge want for Christmas? I get a text every few hours asking about my gifting preferences.
So I’m pleased to formally inform them (and you) that all I want in my stocking is MONEY. And, not just the $20 grandma slides into that singing Christmas card. I mean REAL valuable assets.
Who wants a gift that really does keep on giving? Here’s a breakdown of gifting investments to your loved ones to truly #win this giving season.
Bonds, not bath products
Looking to gift to some older family members or friends? Savings Bonds are a solid strategy. They’re issued by the U.S. Treasury Department to fund government activities. Since they’re backed by the federal government, they are extremely low-risk.
Series EE Savings Bonds: Pay a fixed interest rate that is decided at the time of purchase.
Series I Savings Bonds: Pay a variable rate of interest, meaning the bond will earn the fixed rate plus an estimation of the inflation rate (calculated every six months over the bond’s lifetime).
Heads up: Bonds are not so liquid, meaning they’re great for a long-term investment, but your giftee won’t be able to turn around and cash them the minute they set up an account… Slow and steady wins the race, Santa.
You can buy these bonds through the Treasury Department (known as the Treasury Direct). Create an account, then link your account to the Treasury Direct website.
Side note: Your recipient will need to set up their own account.
Pro tip: Print out this slip and stuff it in their stocking or card. You’ll get laughs and a lot of love.
Unlike bonds, there are tons of ways to buy a stock. The numerous buying options make it super easy to transfer ownership. Not sure how to get started? Here are a few of our favorite options:
Betterment: Donate shares from taxable accounts to charitable organizations.
StockPile: Just like gifting an Amazon gift card, StockPile lets you purchase a gift card with any amount that will equate to a fractional share of a stock. The card can then be given as a plastic gift card or e-gift card. Your giftee can even swap out the stock you’re giving with another of their choice!
GiveAShare: If you’re gunning for a Fortune 100 company, GiveAShare gives easy options for gifting the most-known brands.
Heads Up: Most stock buying options come with fees. The fees may be minimal, but they could also add up if you have a lot of gifts to give.
Mutual funds, not miniature rums
Just like gifting a stock, you can almost as easily gift a mutual fund. Check out companies like Vanguard who offer mutual fund shares. You can easily transfer these shares as gifts. You just have to make sure the recipient of the fund sets up an account with the company that the fund is offered from.
Heads Up: Many of the groups that offer mutual fund investments have minimums of $3,000-$5,000…Now if that’s well within your range, you go, Glen Coco! I’d go with the stock options above if you’re not yet able to share this amount of love…
And to all a goodnight.
Well, this debrief certainly lifted my spirits. Just the thought of receiving a new stock makes my Christmas mood a little brighter. I suppose I’ll steer clear of coal for one more year. Until then, let this guide be a way to think more strategically or creatively about your gift-giving.
Not able to gift one of these options? How about starting with the gift of financial wellness? Nav.it is just a click away and we’ve crafted these cool tokens to stuff even the fullest of stockings…