It’s that time of year again.
Graduation season is in full swing, and everywhere you look there are top ten lists telling you the best gift you can give the graduate in your life.
And while it’s always nice to receive presents, particularly when they commemorate the hard work necessary to earn a diploma or a degree, I would say the best gifts you can give your graduate can’t be wrapped in pretty paper and tied up with a bow.
If you really want to give a new high school or college graduate a gift that will last them a lifetime, think about doing one of the following things:
1. Create a budget. For many people, the word budget has an unpleasant, if not frightening, connotation. But jumping into adulthood without this skill can set young graduates up for a great deal of stress in the future.
If you know that a graduate in your life hasn’t been raised with a budgeting mindset, offer to help her figure out a basic one. This could be as simple as giving her a copy of a personal finance book, or as complex as setting aside some time with her to go over the details of her finances.
Obviously, this is not a gift you can present to a young adult you’re not close to—or one who is not interested in this kind of help. But if you know a graduate who is feeling overwhelmed with the financial aspects of adulthood, they will use and appreciate this gift for life.
2. Set clear boundaries. It used to be that college graduation marked the end of young adults considering their parents’ house to be home. But now the so-called Boomerang Generation is becoming the norm, and many families are finding that their young adult children are ending back in their childhood bedrooms.
This is a tough situation for everyone, and one of the best things that a parent can do for their returning graduate is to set up clear boundaries from the get-go. Let your child know how he is expected to contribute to the household, whether through rent, chores, or a continuing job search.
And, set up a plan together to eventually get him living on his own. It may feel awkward to discuss these matters, but feeling like a contributing and respected adult in a childhood home will make a huge difference to your graduate.
3. Plan for the future. We all know now that retirement contributions made in your 20s have incredible power for growth. But how many of us really understood this in our 20s? Guiding a new graduate through financial planning will help them to know where they want to go in life, and how they want to get there.
Again, this gift can be accomplished in a couple of ways: for example, you could sit down with your graduate and talk about her long term plans for career, travel, family, etc, and help her make a plan to get there.
Alternatively, you could simply introduce your graduate to your financial adviser. Either way, you are helping her to map a financial course for her life.
Giving these kinds of intangible gifts to a graduate might not make you the favorite aunt or uncle at the graduation party. And in some cases, it may not be appropriate to insert yourself into a young relative or friend’s finances.
But in certain cases, being a personal finance mentor is the best gift you could ever give.
Image by CarbonNYC