A gift of appreciated stock or a 529 college savings plan contribution doesn't have the same wow factor as, say, a PlayStation 4 or a "Frozen" doll under the tree, but it may be a smarter bet.
"You're giving something that will have future value," said Carina Diamond, a certified financial planner and managing director of SS&G Wealth Management in Akron, Ohio. "If we look at our families, everyone already has a lot of 'stuff.'"
In fact, when polled, most people say they'd prefer cold, hard cash. In a recent Charles Schwab survey, 53 percent of people said cash to help pay off their credit card debt would be their top gift choice. More than three-quarters of teenagers also picked cash as their most-wanted gift, according to Ebates.com. But there are better ways to give financial aid for the holidays than handing over a stack of bills, say experts.
Diamond said she often gifts shares of mutual funds to her nieces and nephews. Savings bonds or matching contributions to a young worker's Roth IRA can also help set them up for a better financial future. (Check out the video above for more gift ideas.)
Even though you're not braving Black Friday crowds or comparing sales, it's still smart to plan ahead for financial presents. Some states allow tax deductions for gifts made to a 529 plan, but contributions can take time to process, said Diamond. Making the gift after you've alerted the recipient on Dec. 25 doesn't leave a lot of wiggle room.