Santa's mailbag isn't the only one that overflows this time of year. As the kids send their wish lists to the North Pole, I hear from parents and grandparents -- most of whom are beseeching advice about how to get through the holiday season without going overboard. Here are a dozen answers to fequently asked money questions to help keep your finances in tact and to ward of greed in your household.
My kids make wish lists a mile long. What should I do? What you shouldn't do is buy everything they ask for. Kids may want lots of stuff, but they don't actually expect to get it. Tell them point-blank which items aren't in the cards, and have them rank, say, their top five choices among what's left. It's a good lesson in setting priorities. Learn more about how to handle holiday wish lists.
When we tell our kids they can't have something, they say they'll just ask Santa for it. Tell your kids that you and Santa are a team. He's not about to go against your wishes -- and jeopardize his job -- by bringing gifts that you deem too expensive, dangerous or otherwise objectionable.
Should we give our kids money to buy family gifts, or should they use their own? Kids feel better about using their own cash, whether it's from an allowance, savings, money they've earned for doing extra chores or even a holiday bonus if you think they've managed money well during the year. If they're short on cash, encourage them to chip in with siblings or to make handmade gifts.
I just got my son's wish list, and nearly every item tops $100. What's a parent on a budget to do? It's important to establish limits up front. Decide how much you're willing to spend and tell your children. If your son stands firm on his wish list, there's no better way to teach him the value of a buck than to encourage him ante up his own. You can always give him the fixed amount of cash or a gift card for him to put toward the item, and leave him to come up with the rest. And with a vested interest in what he buys, he's more likely to appreciate and take care of it -- or to realize it's not worth the expense.
How can we get our kids to give to people who really need it? Have them do something hands-on, such as donating a gift through a local toy drive or participating in a charitable project such as running errands or shoveling snow for neighbors who are elderly or ill for no pay. Or, designate a container in which your children can deposit loose change. When the jar is full, they can donate the money to a charity. Learn more about teaching your kids the value of giving, and check out these 12 no- or low-cash ideas for donations.
As our kids get older, it's tough to know what they'll like. Is it too crass to give them money? Kids old enough to buy their own clothes and CDs welcome money. If it's feasible, give them cash instead of a check; it's easier for kids to spend. Gift cards from music and clothing stores are an alternative, but make sure the kids won't be charged a penalty if they don't use the cards right away.
Should I allow my kids to spend gifts of cash, or require them to save it? How about a little of both? Relatives who give financial gifts often do so because they're not sure what to buy, and they actually prefer that kids spend the money on something they want or need. It's no fun for anyone if kids have to whisk all the money off to the bank. However, it's reasonable for you to require that kids save at least part of the money. Learn more about how to set up appropriate guidelines for your children.
How many gifts should a child get? You know you've bought too much stuff if you can't remember what you hid where -- and the kids get bored and walk away while opening their gifts.
How can I keep relatives from going overboard on buying gifts for my kids? Your child's gift list may be a mile long, but you should never share the entire list with relatives. Whittle it down to ten or so (small) items and parcel them out. Better yet, suggest that they give your child a gift of their time and do something special with him or her, such as bake cookies or go to the zoo.
I can't find a single toy for my 9-year-old daughter. She can't come up with anything she wants, either. How do I hazard a guess without insulting her and wasting my money? Sadly, the so-called tween market is outgrowing traditional kid things, such as toys and children's entertainment, at an earlier age. They're rushing (or being rushed) into teen interests, such as music and brand-name clothes. But don't give up on your daughter's childhood. Poke around stores and flip through catalogs for inspiration. A craft kit or board game might be just the ticket. Is there something she might like to collect? Tap an interest in stuffed pigs or nesting dolls (two favorites of my daughter), and you will have gift ideas for years to come. See Toys for Tweens for more ideas.
My kids asked me if we are rich or poor. How do I respond? Usually, what kids are really after with this question is a general idea of how you're doing -- and whether now is a good time to ask you for the bike they have their eye on, or why you refused to buy them something they want. One response is, "We have more money than some families but not as much as others." Another approach: "We may not be rich, but we have enough money to buy the things we need with some left over to share." Get more advice on how to explain your budget to your kids.
Are written thank-you notes from the kids really necessary? An email or phone call would be much easier. Every gift deserves a thank-you in some form, and a written note is the most desirable. It's worth nagging your kids to sit down and write one -- their expenditure of time is small compared with the large amounts of money lavished on them. Thank-you notes should be specific and mention the gift and how the child liked it. Hand-made cards are a nice touch, but not necessary. Email is acceptable as long as the children do their own hunting and pecking on the keyboard.
Janet Bodnar writes a weekly column on Kiplinger.com in which she answers your questions about kids, money and finances. Read her columns and send her your questions at Kiplinger.com/columns/kids. And sign up to receive her advice each week via email.