Financial gifts for 1 year old babies?

[iam21177]

I have a niece and nephew who are turning one pretty soon (they are cousins, not twins). I used up all my brain power to figure out Christmas toys just two months ago. I'm sure a 1 year old won't remember getting a gift, so I want to do something practical and useful.

I saw this UGift thing - were you can donate money towards college, but it's still confusing me. I don't think either have any 529s set up yet.
https://thegiftplan.s.upromise.com/c...ml#whatisugift

Then there's this which buys stock as a gift through One Share:
Gift Ideas for a Baby

Savings Bonds? To cash out when they are 18?

So maybe you get where I am going with this - what should I give? Also I have a 6 year old nephew, and I kind of missed the boat on him. Do I make up for it to make it even by getting him something similar? I"m sure he'd rather have a Nintendo 3DS game.

[meierlde]

Based upon what I have read it was last year that paper bonds were ended, it now looks like a mutual fund in that every thing is electronic. The treasury site did not talk at all about not selling them electronically. Of course they earn .2% right now so not a great investment.

[RetiringAt55]

We gave silver coins. I made each child a silk pouch with their name embroidered on it that can store the coins over the years.

[iam21177]

I just asked my sisters if they have a 529 open yet (if they did they'd be really on the ball!).

This Ugift allows you to put money towards another's college plan as a gift.

"Ugift is a new way to invite family and friends to celebrate a child's milestones with the gift of college savings. This easy-to-use service lets the special people in your life make gift contributions directly to your 529 plan account."

That would be so great if that would work. I'd make it a regular birthday contribution.

RetiringAt55 Do the Silver coins appreciate? I know nothing about them other than my mom has a few in a pouch herself!

[pb4uski]

How much were you planning on spending? My initial inclination was that you could open an account with Vanguard in each of their names but the lowest minimum is $1,000. We used the STAR fund for our kids and were quite happy with it.

[iam21177]

Quote:

Originally Posted by pb4uski How much were you planning on spending? My initial inclination was that you could open an account with Vanguard in each of their names but the lowest minimum is $1,000. We used the STAR fund for our kids and were quite happy with it.

That sounds pretty cool and along the lines of what I was looking for (something that just grows). Although I was thinking more like $50-100.

I missed the boat on the other nieces and nephews 1st birthdays (they are 3, 4, 6 right now). Don't want to go too big since I didn't do that with the others.

[RetiringAt55]

They were actually "silver bullion" so they should go up as silver does.

[Bikerdude]

You can set up a 529 for them. Maybe even get a State tax break depending where you live.

[iam21177]

Quote:

Originally Posted by Bikerdude You can set up a 529 for them. Maybe even get a State tax break depending where you live.

I can set up a 529 even if I don't have kids?

[pb4uski]

See https://investor.vanguard.com/what-w...llege/overview and https://uii.nysaves.s.upromise.com/c...andfamily.html

It looks like you could set up a Colorado, Missouri or NY 529 that has Vanguard funds backing them with lower minimums ($25). I took a quick look at the NY version and you do not have to be a NY resident to set up an account.

YMMV.

[iam21177]

Quote:

Originally Posted by pb4uski See https://investor.vanguard.com/what-w...llege/overview and https://uii.nysaves.s.upromise.com/c...andfamily.html It looks like you could set up a Colorado, Missouri or NY 529 that has Vanguard funds backing them with lower minimums ($25). I took a quick look at the NY version and you do not have to be a NY resident to set up an account. YMMV.

Very cool! I will look into this further now. I would plan to donate maybe $50 on each birthday at first? I have 5 nieces/nephews so I probably should do that for everyone on all their birthdays.

[GrayHare]

Quote:

Originally Posted by ginadog Very cool! I will look into this further now. I would plan to donate maybe $50 on each birthday at first? I have 5 nieces/nephews so I probably should do that for everyone on all their birthdays.

Note that some states offer residents a tax credit for a 529 contribution, but only if you place it in one of that state's plan offerings.

[bondi688]

You can set up a custodian account with Schwab ( I think they probably have similar account with Fidelity , Vanguard etc) if you do not want it restricted to educational use only. The minimum to open is $100, and there is no monthly fee, and you can invest in Schwab no load mutual funds with a minimum of $100 in those accounts.

Custodial Savings Account: Schwab Brokerage: Custodial Account

Mutual Funds

If you put a $100 each in a S&P index fund and let it grow for 30 years, it may amount to a tidy sum for them.

[iam21177]

Quote:

Originally Posted by GrayHare Note that some states offer residents a tax credit for a 529 contribution, but only if you place it in one of that state's plan offerings.

That would be a bonus!

Quote:

Originally Posted by bondi688 You can set up a custodian account with Schwab ( I think they probably have similar account with Fidelity , Vanguard etc) if you do not want it restricted to educational use only. The minimum to open is $100, and there is no monthly fee, and you can invest in Schwab no load mutual funds with a minimum of $100 in those accounts. Custodial Savings Account: Schwab Brokerage: Custodial Account Mutual Funds

I did not know about Custodial Accounts! Lots of investigate now.

If you were a baby what would you want for your 18+ year old self? Just kidding!

[powerplay]

Quote:

Originally Posted by ginadog That would be a bonus! I did not know about Custodial Accounts! Lots of investigate now. If you were a baby what would you want for your 18+ year old self? Just kidding!

All I can say is that when I was 18 or 19 and took all those EE bonds my grandparents had given me over the years and cashed them I was one happy camper!

[iam21177]

Quote:

Originally Posted by powerplay All I can say is that when I was 18 or 19 and took all those EE bonds my grandparents had given me over the years and cashed them I was one happy camper!

I cashed in some too when I was 18 and I recall it being $850 or so (for a $25 bond) which went right to my tuition at the time. My mom said it was no where near that much however. I remember it being such a cool idea (so I think it was $850). I would not remember $25.

[Bikerdude]

Quote:

Originally Posted by ginadog I can set up a 529 even if I don't have kids?

I have them for both my Grandkids. Check out the program in your State.

[FIREd]

I bought an I-bond earmarked for my godchild in my own treasury direct account. She'll get the proceeds on her 18th birthday.

[rodi]

Agreeing with the suggestion for 529's.

My dad started our boys 529's. And since he did the work, I just contributed to that one... and inherited it when he died. (Kids are beneficiaries... but ownership transfers seperately.)

My step mom gives $50 contributions each year on their birthdays, as she does for all her grand kids.

Whenever someone asks what the boys need - I suggest contributions to the 529.

The nice thing about 529's vs some of the other suggestions - no taxes to worry about for your kids. A friend had a relative gift the kids with stock - now he has to file taxes for them. (It's a dividend paying stock.) Another friend's parents set up trusts for the grandkids - and it took him longer to do the kids taxes than his own. Ironically, his dad was a tax attorney - and he's the one that set up the trust.

[bondi688]

Quote:

Originally Posted by ginadog I cashed in some too when I was 18 and I recall it being $850 or so (for a $25 bond) which went right to my tuition at the time. My mom said it was no where near that much however. I remember it being such a cool idea (so I think it was $850). I would not remember $25.

Probably you did not get that much. To double your money, it requires 7 years if times are good. So it was unlikely $25 will grow to 850 on saving bond interest alone. You may get that 3 doubles in 21 years with $100 in a stock index fund and get to $800.