8 Financial Gift Ideas for Valentine’s Day

Valentine's Day is a time when many couples exchange gifts as a gesture of love. Often, people give flowers, others jewelry, and there’s even the gift of an experience.

Now:

Considering how there are several gift-giving holidays throughout the year — Christmas, birthdays, anniversaries, etc.— you might be on the hunt for a unique idea.

While it’s common to give flashy jewelry or lavish material goods, there's no rule that says you have to go down this path.

It's possible that...

Our loved one or significant other might prefer other types of gestures — maybe a financial gesture.

If you and your partner have everything you need materially, it doesn’t make sense to clutter your house with more stuff.

Think outside the box and consider other ways to put your money to good use.

There are more ways to say “I love you” than flowers, candy, or jewelry.

1. Give the Keys to Your Apartment or House

This holiday might be the perfect time to let your partner know that you're ready to take the relationship to the next level.

Rather than spend money on an expensive gift, a simple gesture like giving the keys to your apartment can convey your deep feelings for them and the relationship. You can get creative by wrapping the key in a box and presenting it at dinner.

Keep in mind:

Giving the keys to your apartment doesn't necessarily mean moving in together.

Instead, it can mean giving them easy, unrestricted access to your place. If so, make this abundantly clear.

Then again, if you are ready to step up the relationship, ask them to move in with you.

You’ll not only enjoy more time together as a couple, this living arrangement offers financial benefits. You might agree to share rent and utilities, resulting in long-term savings for both of you.

To avoid problems down the road, however, discuss your expectations upfront.

In other words:

Who will pay for what.

It might also help to look for a “new” place to share together. This way, it doesn’t feel as if one person is encroaching on the other’s personal space.

2. Buy a Life Insurance Policy

Many people don't like to think about life insurance because death is an unpleasant topic.

But unfortunately, death is also a reality. And when someone dies, a life insurance policy can provide surviving family members with much-needed financial support.

If you’re thinking about unique gifts to give, consider taking out a life insurance policy in your name, and then naming your significant other as the beneficiary of this policy.

Look:

This type of gift doesn't offer an immediate reward. But a life insurance policy does guarantee the payout of a death benefit when a policyholder dies.

Make sure you understand how different life insurance policies work.

A term life insurance policy is attractive because it is short-term and less expensive. Yet, there’s the risk that you'll outlive this policy.

A whole life insurance policy is permanent and provides coverage for your entire life, as long as you keep up with the premiums.

Unfortunately, whole life policies are more expensive.

Speak with an insurance agent to review life insurance options and compare prices.

3. Redeem Your Credit Card Rewards for a Trip

Sometimes, using a credit card is much easier than using cash.

As long as you pay off your balance in full every month, you don't have to worry about accumulating massive debt.

Depending on how often you use a credit card, you may accumulate a ton of reward points redeemable for cash, statement credit, travel, etc.

If you want to give a special gift but don't have enough cash, redeem your credit card reward points for a gift card, or use your points to book travel.

Even if you don't have enough reward points to cover the cost of an entire trip, you might have enough to redeem for one plane ticket.

This can significantly reduce what you pay out-of-pocket.

4. Help Pay Off a Loan

Big debts like student loans and auto loans can be a major financial burden.

If your partner struggles to pay down these debts, or if they’re working extra hours to eliminate debt sooner, offer to help pay the balance.

This doesn't suggest stroking a check for the entire balance—unless, of course, you want to.

Instead:

Give what you can to reduce the principal amount of these debts.  

Then again, maybe your significant other doesn't have an auto loan or a student loan. Instead, they’re struggling with credit card debt. If you feel comfortable with this, offer to help pay off their credit card.

Only do so, however, if they're committed to keeping their balances low.

Unfortunately, some people continue to spend frivolously or impulsively after paying off a credit card.

So while paying down this debt is a nice financial gesture, be honest with yourself.

Has this person demonstrated an ability to manage credit cards responsibly moving forward?

Make sure they understand the value of charging only what they can afford and paying off their balances in full every month.

If they don’t:

Don’t waste your money.

5. Offer to Add Them as an Authorized User

If your partner doesn't have a credit history of their own, adding them as an authorized user on your credit card can help establish their credit.

You remain the primary account holder.

As an authorized user, however, the other person also gets a credit card in their name.

They can use the card, but you’re responsible for all charges on this account. Therefore, it’s important that you set limits and monitor the account balance.

This credit card account will appear on the authorized user’s credit report.

As long as you make timely monthly payments and don't accumulate a high balance, your good credit habits will benefit their credit score.

6. Offer a Savings Match

Even though some people are diligent about contributing to an employer-sponsored 401(k), they might have little funds in a liquid emergency account.

If your partner struggles to build an adequate emergency fund, offer a one-time or continuous savings match to help jumpstart their savings efforts.

Again, only do what you can afford.

So if your partner can contribute $250 to their emergency savings every month, see if you can match this and give an additional $250.

To help grow their emergency fund faster, suggest opening an online high-yield savings account.

Not only can they earn a higher interest rate compared to a regular savings account, the money is less accessible in an online account.

As a result, there’s less temptation for unnecessary withdrawals.

7. Invest in Their Future

Some people want to start a side business or continue their education.

But unfortunately, they don’t make the first move due to lack of resources. Rather than give jewelry or another lavish gift, invest in your loved one’s future.

For example, give a small cash investment to help them start a business. It doesn't have to be much. Maybe enough for them to create a website, design business cards, or apply for a business license.

Or if your partner wants to take a class that will open doors to more career opportunities, offer to pay for this course so that they don't have to get a loan.

8. Give the Gift of Stock

Rather than the gift of cash, give the gift of stock.

Granted, the value of stock can increase and decrease over the years. But in the long run, a stock gift often comes with a higher return.

The gift of stock can also help the recipient learn about investing. Plus, there’s the excitement of watching their stock increase in value.

There are two ways to make this happen:

  • Transfer existing shares
  • Purchase shares as gifts

To transfer shares of stocks you already own, contact the brokerage firm or company that handles your investments to discuss how to proceed.

Be mindful that you'll need the name of the recipient, their address, their Social Security number, and other contact information to complete the transfer.  

If you don't want to transfer some of your own shares, the easiest route is to buy stock from an online company that lets you purchase individual stocks for others.

These companies include SparkGift, StockPile, and GiveAShare. You can choose specific stocks to purchase, as well as purchase amounts. The recipient will receive a gift certificate for the purchased stock.

Be aware that some companies have minimum purchase amount and service fees.

Conclusion

Why give the same type of gift year and year when you can give a financial gift of lasting value?

Consider the needs of your loved one, and then plan your financial gift accordingly.

Also, if you give a financial gift, don’t forget to mention this to your accountant when filing your tax return.

You may have to pay a gift tax depending on the amount of your gift.

In 2019, a gift tax liability applies when giving more than $15,000 to any one person in a given year.

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