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Parents of the World Unite!

By JLP | October 5, 2006

Remember when I posted this Question of the Day asking parents if they ask for help in funding their kids’ college savings accounts? It appears that I (and those who agreed with me) are not alone. According to this article that reader Stacey emailed me last night:

A survey by San Francisco college savings company Little Grad has suggested that parents prefer friends and relatives give college money as gifts.

The survey found that 61 percent of responding parents preferred their children to receive college funds on holidays rather than toys, with 13 percent dissenting.

As I stated before, I think this will always be a problem because it simply isn’t fun for relatives (and even parents) to give money as gifts. It seems impersonal and most kids hate getting money because they can’t grasp the significance of the gift. That’s why I’m an advocate of moderation. Why not spend half of the gift budget on a toy and give the other half to mom and dad to put in the college fund? Of course, this idea has a shortfall because it could be embarrassing for those who don’t normally spend a lot of money on gift-giving.

There’s no easy answer. I think each family has to approach (or not approach) this topic in a way that they see fit. But, based on the above survey, parents are at least thinking about college funding. This is a good thing!

Topics: Budgeting, College Funding, Relationship Finance | 4 Comments »


4 Responses to “Parents of the World Unite!”

  1. Kira Says:
    October 5th, 2006 at 10:35 am

    I think it is an excellent idea to give small sums of money to kids for their own use, maybe with a small toy, and then give some other small amount to the parents for college, as long as you think the parents will responsibly put it away. If you don’t have a lot to spend on a present, I don’t think it’s probably in your best financial interest to be putting money towards someone else’s child’s college education in 15 years. But ten quarters to a four year old is a FORTUNE and will quickly teach them to be savers!

  2. prlinkbiz Says:
    October 5th, 2006 at 11:08 am

    Of course as a parent I’d prefer something practical to toys anyday of the week. I’m all about teaching my kids how to manage and grow their money. Stashing it away for 15 years until college? No way. Do you know how much that money could have earned , say, buying a house that appreciates? I’d rather grow money than stash it.

  3. Carl Says:
    October 5th, 2006 at 11:49 am

    As a parent, I am just going to trip over the toy, or it is going to break. I would rather the pratical gift also. With my 2 boys I suggested that family give us cash for hteir birthday and more token gifts. The cash went for a clubhouse in the back yard which thay can enjoy for years and would otherwise be hard to afford without the gifts. So it it is more a poolling of resources to afford a big gift.

  4. WearyTraveler Says:
    October 5th, 2006 at 2:35 pm

    I just started a 529 with a $50 per month for my 3 month old grandson. I figure that over the next 18 years or so, that money will grow to a sizable chunk to help pay for college. Another way to look at the 529 is that it’s actually a gift to my son. It’s taking a load off his shoulders down the road.
    I still plan to but toys / gifts that my grandson can enjoy while he’s growing up because you can’t play with a bank statement.
    We’re a big family, so fortunately there will be no real lack of gifts coming in over the years.

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