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Nicole Chan Loeb is a 38-year-old photographer, videographer and mother of two.
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She and her husband prioritize experiences over gifts, so they invest for their children instead of toys.
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They want to teach their children financial literacy and prepare them for a secure financial future.
This as told essay is based on a conversation with Nicole Chan Loeb, a Boston-based photographer and videographer. It has been edited for length and clarity.
My kids are 1.5 and 4 years old, and I have never bought them physical gifts for birthdays and holidays.
For birthdays I make a cake, and instead of buying toys and clothes, I invest money for them so they can build a more secure financial future. Plastic toys and trinkets are temporarily fun, but create mess and waste in landfills.
Growing up, my mother would tell me about the stocks or funds she invested in for me. Every week we would take the numbers in the newspaper, plot them on graph paper and tape them to the refrigerator. We mainly invested in investment funds. That was fun, and I especially enjoyed the special time my mother and I spent together. I also want to teach my children financial responsibility and literacy.
My husband and I met in college in 2004. We both worked in finance and accounting – I did management consulting and he did internal auditing – before we decided it wasn’t for us. I quit in 2010, and he quit soon after, and we both became entrepreneurs. I’m a photographer and videographer, and he owns an escape room company.
It was a significant risk and I was absolutely terrified. But since my parents taught me financial literacy, I’ve learned how to save so I can feel comfortable no matter what. Plus, the flexibility and fulfillment this lifestyle offers is well worth it.
My husband and I generally do not exchange gifts. When we want something, we just buy it for ourselves – after all, our money adds up – so I find gift giving a challenge. Instead, we share and enjoy dinners, experiences, shows, and vacations. We give each other cards – it’s more about the sentiment.
This year, my husband and I maxed out our children’s Roth IRAs and deposited $7,000 each. My children have modeled for children’s clothing lines, toy companies and catering campaigns in my work as a commercial and advertising photographer, so the money is considered their earned income.
We decided to start investing for the kids last year because, through conversations with friends, we realized that we all wanted topics like taxes, saving for retirement, and smart investing to be taught in high school or earlier. We decided not to wait and agreed to start teaching these concepts as soon as our children could understand the basics.
Furthermore, both my husband and I were fortunate enough to be able to leave school without massive debt from our parents. These investments allow our children to graduate without insurmountable debt.
We’re focusing on Roth IRAs for now, but we plan to open investment accounts for them within the next year. If they have not earned any income in the coming years, we will open a custodial account and invest for them that way. Because we both own our businesses, our salaries and incomes fluctuate, so we look at our finances every year and decide how much we want to invest.
My children are young, so the concept of expecting gifts is still being solidified. And they don’t really need anything. We are fortunate to live in a great neighborhood where parents pass on toys when their children outgrow them. I rarely buy large toys or gifts, but I don’t shy away from ad hoc purchasing crayons, markers, kids’ card games, and board games.
Our kids are happiest when we spend time together and do things like lunch dates, play board games, and bake. Happiness comes from experiences and relationships, and less material things promote creativity.
They spend a lot of time outside making up their own games, and we often play with things like sticks, rocks, water, acorns, and pine cones. We want happy, well-balanced children who are not overwhelmed by things and toys and chasing the next new shiny object.
My husband and I find great interest and enjoyment in investing, and we hope our children will too. My four year old is very smart, and in a year or so he will understand that you can put money into specific vehicles to grow, and learn the concept of delayed gratification.
I’m hopeful that our kids will start earning their own extra income in high school and learn to invest for themselves as teenagers, just like I did growing up.
If you have a unique way to teach financial literacy to your children and would like to share your story, email Jane Zhang at janezhang@businessinsider.com.
Read the original article on Business Insider
