This year, how about a gift with real worth?
By Michelle Singletary
WASHINGTON — A new poll from the Center for a New American Dream, a nonprofit on a mission to protect the environment by curbing conspicuous consumption, found that people are financially tired this holiday season. Even though gas prices have been coming down, consumers feel whipped from the months of paying high prices at the pump. They know their heating bills will be higher this winter season. And they are tired of paying on credit card bills that never seem to go down.
To combat the financial fatigue, people who responded to the poll said they wanted to give gifts that encouraged savings rather than spending. More than three out of five respondents (62 percent) said they were either planning to or considering giving family members gifts such as a savings bond or a piggy bank this year.
I would like to believe the Center for a New American Dream's poll. It's not that I doubt its veracity. I just know people. They often say one thing and do another.
I would like to think that on Black Friday, the official start of the Christmas shopping season, those hundreds of shoppers across the country who got up before dawn to stand in the cold had indeed climbed out of their warm beds to beat the rush on piggy banks, or wanted to be the first in the line to purchase savings bonds when their banks opened.
But you and I both know this didn't happen. People were shoving and walking over each other to buy the new Microsoft Xbox 360. They were crowding stores, buying more stuff that nobody really needs. They were frantic to buy their kid an iPod. (Mind you, I bet many of those parents buying all this stuff for Christmas don't have $300 saved in a college fund. Sorry, I don't want to be called a Grinch again.)
Anyway, for the second year, here are my favorite financial gifts:
I like these bonds because they are a low-risk investment that also keeps pace with inflation. While you won't get spectacular returns, you do earn a guaranteed real rate of return. The earnings rate is a combination of a fixed interest rate plus the rate of inflation, adjusted semiannually. I Bonds are currently paying 6.73 percent through April.
Here's another plus for buying I Bonds. Under the Treasury Department's Education Savings Bond Program, interest earned on the bonds can be completely or partially excluded from federal income tax when the bond owner pays qualified higher education expenses at an eligible institution or state tuition plan. To get the tax break, the transaction must occur in the same calendar year the bonds are redeemed.
Before you buy the game, try the demo at www.mrbigshot .com. It's actually rather fun. This stock market game isn't too complicated and, in a basic way, simulates individual stock investing. The CD-ROM is $19.95. The board game costs $29.95 (this includes the CD-ROM version).
At least this year, if you're going to spend yourself silly, add to the mix of your gifts something that has the potential to appreciate in value. Whether it's a piggy bank, bond or financial game, give something that will help someone save, invest or spend more wisely.
