Of course, a check is always good for someone starting on a new path. But there are lots of other options—from practical gifts to those that have a more lasting financial impact.
When Michelle’s son graduated from high school in 2017, I gave him a leather portfolio. He’s since told me that this was a great gift and gave him a professional “prop” for interviews the next four years—be it for campus leadership positions, internships or his full-time job search. I ordered his with a university insignia from his college’s campus bookstore, but embossed initials are timeless, too.
Another tried-and-true gift, this saves parents cash when shopping for college and can also be a nice touch for a college grad furnishing that first “real” apartment. Monogrammed towels can be ordered in a variety of colors, monogram styles and thread options. Plus, there’s no arguing that a roommate has your towels when your initials are on them!
Again, if you’re looking to help both the parent and student, be selective on the gift card you choose. Bed Bath & Beyond, Target, Walmart, etc. would all help with that dorm room or first apartment.
Starter fund for emergencies
Ideally, everyone should have three to six months’ worth of income set aside for emergencies. That’s probably a bit of a stretch for a new college graduate. But even $500 or $1,000 could mean the difference between taking an unexpected expense in stride and racking up credit card debt.
Personal finance and career books
You probably have a lot of wisdom to share with the younger generation. But somehow hearing it from an “expert” carries more weight.
These books will help graduates establish good financial/career habits for a lifetime:
- The Exceptional Professional: What You Need to Know to Grow Your Career—by Callista Gould
- The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich—by David Bach
- I Will Teach You to be Rich—by Ramit Sethi
- Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence—by Vicki Robin and Joe Dominguez
Helping a young adult open a Roth individual retirement account (IRA) is literally the gift that keeps on giving. This account can continue to appreciate for decades to come.
Another benefit of a Roth IRA is that it’s funded with after-tax dollars [as opposed to a traditional IRA or a 401(k), both of which are funded with pre-tax dollars]. So in 30 or 40 years, when today’s new graduate retires, they’ll pay no income taxes on withdrawals.
To learn more about the (many) benefits of Roth IRAs, read our blog post on the topic.
Budgeting and low-minimum investing app
Having financial guidance at their fingertips can be a big help to new grads. There are lots of apps that track what you spent over the last week/month/year (one example is Mint).
The “You Need a Budget” (YNAB) app, however, also helps you look forward so you can establish priorities and plan your spending in advance. At $84 for an annual plan, it makes a great graduation gift.
Another option is Acorns. This all-in-one app includes options for checking, investment and retirement accounts—and more.
Session with a financial advisor
There’s a reason our firm is called Generations Wealth Management. Solidifying your own financial security is one thing. But what’s the point if your kids don’t know how to manage and sustain that wealth?
This is where a session with a financial advisor can be a tremendous help for a new graduate. Whether or not they’ll start off with a financial cushion, giving them customized financial guidance can help them avoid the potholes that trap so many people.
An advisor can show them how to avoid credit card debt, create an emergency fund, buy a home, save for retirement, choose investments wisely, etc. And establishing a relationship with an advisor now will give young adults someone to turn to when financial questions arise. If you’d like us to meet with the new grad in your life, contact us to schedule an appointment.
A gift with a lasting impact
Giving your favorite graduate a financial gift is a way to make sure your present is remembered and appreciated for years. We hope these ideas are helpful. If you have others, share them with us on our Facebook page!