Stay at Home Moms

Kid's money question

My family is big on giving monetary gifts to my kids.  So is DH's.  DD has a substantial amount of money in her bank account.  I'm not talking she rec'd $25 and should I save it or let her pick a toy.  It's quite a bit of money.  DS was just baptized this weekend and now his bank account is also steadily growing.  If your children receive a lot of monetary gifts, what are you planning on doing with the money in their accounts?

I will not be writing Mini a check for XXXX.XX when she turns 18 to do what she wants with the money.  I don't even think she needs to know what is in the account.  Obviously when she gets older and sees the checks from her grandparents she can pick something out at the store and I will bank the rest.  And eventually she is going to be a teenager and want to spend the whole check on something, but if her bank account continues to grow, it will be a decent chunk of money.  

So...if your kids have money in the bank, do you have any plans on how you will be using it for them?  Education, first car, just letting them spend it on what they want?


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Re: Kid's money question

  • Education or something they need when they are newly an adult, like a reliable car or a down payment for a house.  Once they are old enough to understand money, I will strongly encourage saving these monetary gifts and potential  match what they bank (as long as they are not removing money from this account).  
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  • ariel06 said:

    Education or something they need when they are newly an adult, like a reliable car or a down payment for a house.  Once they are old enough to understand money, I will strongly encourage saving these monetary gifts and potential  match what they bank (as long as they are not removing money from this account).  

    Oh I love the matching idea.

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  • hokies94hokies94 member
    edited April 2014
    Both DD received a fair amount of money from DH's grandmother when she died.  We've opened up brokerage accounts for them so they can learn how to invest in the stock market.  They're only 11 and 9 right now so their knowledge is very limited, but we're going to teach them how to invest wisely. 

    This money is separate from college funds we're saving for them.  We don't expect them to put any money they receive in the college fund.  This money is just for them.  I hadn't thought about what they would be able to spend it on.  Hopefully, if we teach them well enough they'll want to keep saving it for way down the line (house, their own retirement, weddings, etc).  We'll see.  That's a LONG way off. 

    They have savings accounts that they put allowance/earned money in.  They're free to do what they want with that account, although we highly encourage them to save what they have in there.  
  • We put the $ in their saving accounts and they will get access in high school when they have jobs but we will stay on their accounts until college so we can veto overspending. My parents gave me access to my account in college and I used the money to pay for "fun" things and still added to it in the summer. I also had quite a bit when I graduated and used it to get settled into my apt and life.
  • It's in her savings account. We'll use it to pay college tuition. If she has way more than she will need for tuition because she picks a cheap school or gets a nice aid package then I will give her some of it for spending money in college. $50 here and there, probably. When she graduates, I'll give her the rest of it.

    Honestly, I'm planning on needing to shell out money for college when the time comes. I doubt we'll save more than tuition, I was planning to make it part of our budget for those 4 years anyway.
  • Right now her account is pretty small and our plan goes about as far as "we'll see", but I am not opposed to using it for a special trip/camp/experience we otherwise couldn't afford. I am not planning on it being her college fund.
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  • edited April 2014
    Cash goes in their piggy banks and they can choose to spend it if they wish. Checks go in the bank. As hey get older we'll discuss the money with them. We should be able to cover cars and college so ideally I'd like to keep up with their investments until they are old enough to buy a house with it

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  • Currently all of my kids' money goes into their 529s.  My parents and sisters are the only people who really give money, and it is never small amounts, so they specify that it is to go to their education funds.  They will get any money leftover in their college funds after college.  I figure this is a great way to encourage them to finish in a reasonable amount of time, and also to apply for scholarships and grants.  I have often heard that kids who have their education paid for, kind of take it for granted and waste time and money.  I found this to be a good incentive for me, along with my dad telling me not to walk back into the house with less than 15 credit hours a semester.

    I am not sure what we will do as they get older.  I don't see that college stipulation changing since it is typically from the gift giver.

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  • My son has a saving account where his money goes, Disney stocks a friend gave him so those checks goes into his account, and one of those grow up plans from his grandma. We're hoping to cover cost of college and first car but he can use the money for something that makes sense.
  • Right now, we don't have enough left over to save for A and the presents she gets are never monetary. Once she gets older and that changes, she will get part of the money to save up for something she wants (toys, etc.) and the rest goes into savings. The money will not be used until she is 18. She can use it for whatever she wants, but we would prefer it go toward either her education or car.
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