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A baptism is a once-in-a-lifetime event, so naturally, many guests are unsure what type of special gift is right for the occasion.

However, while there are endless options for presents you could give for your loved one’s baptism and christening, money—believe it or not—is the perfect gift.

But money doesn’t just have to be cold, hard cash. In fact, we discourage straight-up cash. That’s because there are longer-lasting monetary gifts you can give that will increase in value (and thus be more advantageous for the child) in the long run.

Let’s go over why money is an excellent baptism gift. We’ll cover some of the best monetary baptism gift ideas, as well as answer other popular baptism gift questions.

Why You Should Give Money as Baby Baptism Gifts


money dollar bills growing

Customary christening and baptism etiquette is to bring a gift. Because the baptism ceremony (and the christening, also known as a naming ceremony) is a spiritual event, many people choose to bring religious baptism gifts. Popular examples include a bible, rosary, or a personalized gift with a bible verse engraved on it, like a keepsake box or picture frame.

But the best baptism gifts, in our opinion, are monetary. That’s because these presents can have a truly lasting impact. And while, yes, cash is the most popular financial gift for this special occasion because it’s easy, other monetary presents are far more useful over the long term.

Indeed, as the child transitions into adulthood later in life, they’re sure to be grateful for the monetary head start you provided.

Related: 18 Best Debit Cards for Kids & Teens to Become Money Savvy

Best Baby Baptism Gifts for Boys and Girls that Last

1. Custodial Account


mother baby computer custodial account

What Is a Custodial Account?

A custodial account is a financial account that an adult maintains for a beneficiary, usually a minor. Most commonly, a parent will control custodial accounts for their children.

The two types of custodial accounts are the Uniform Gifts to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) accounts. In both cases, the account is in the beneficiary’s name, and the funds legally belong to the beneficiary. However, an adult manages the investment account until the minor reaches the age of majority, which varies by state, but usually is 18 or 21.

UGMA and UTMA accounts have two primary differences:

  1. UGMA accounts can be used to hold only strictly financial assets, while UTMA can hold financial assets as well as property—say, real estate or cars.
  2. UGMA accounts can be opened in all 50 states. However, only 48 states allow for UTMA accounts. (South Carolina and Vermont are the exceptions.)

Let’s talk about the types of financial assets you might consider gifting your loved one for use in a custodial account.

What You Can Hold in a Custodial Account

Custodial accounts can carry a wide range of investments. The riskiest types of investments, such as options, aren’t allowed, but many popular investments are fair game.

Stocks


investing in stocks on smartphone

Individual stocks are among the riskier investments you can hold in a custodial account. Even shares of well-established companies can be volatile in the short term.

Nonetheless, stocks are an excellent gift for a baby girl or boy because the child has ample time to wait out volatile periods. By the time the child reaches adulthood, the value of that stock should have grown substantially.

We recommend sticking mainly to blue-chip stocks, which tend to be more reliable. They should also be treated like long-term investments rather than things to be traded frequently.

One more tip: If you gift dividend-paying stocks, and the account is set to reinvest the dividends, the child will end up owning even more shares than you originally purchased!

Mutual Funds


mutual fund index diversification

Mutual funds are like baskets of assets, such as stocks and/or bonds. You simply invest a certain dollar amount in the mutual fund, and someone else spends the time researching investments and deciding what the fund buys and sells.

Mutual funds are typically actively managed, which means that a human fund manager (or several managers) chooses what to hold. One disadvantage to this is that you typically have to pay high fees to cover management’s costs.

Target-date mutual funds are a particularly thoughtful gift. You select the fund based on the year you expect the child to retire, and fund management automatically adjusts the fund’s holdings—from aggressive early on to more conservative later in life—as the years roll on.

Just buy a target-date fund, and it does the rest.

Exchange-traded funds (ETFs)


children finances pie chart fund

Exchange-traded funds (ETFs) are another wonderful option as a baptism gift.

Like mutual funds, they’re diversified. But unlike mutual funds, which settle all transactions once a day after the close of trading, ETFs trade on exchanges during the day, just like stocks.

They also charge less in fees on average than mutual funds. And rather than mutual funds, which often require minimum investments of a thousand dollars or more, you can buy an ETF for the price of one share—often in the tens or hundreds of dollars. (Even less if you can buy fractional shares!)

Index Funds


pie chart etf mutual fund

Most ETFs, and some mutual funds, are “index funds.” That means the fund is designed to match the performance of an index, such as the S&P 500.

They’re typically diversified, made up of dozens if not hundreds or even thousands of stocks, bonds, and other assets, just like actively managed funds. This diversification makes them some of the safest investments you can give as christening gifts.

Because index funds are “passively” managed (run by sophisticated computer programs), they tend to charge lower annual fees than actively managed funds.

Bonds


savings bonds ee

Bonds are among the safer investments you can add to a custodial account.

Bonds typically provide a reliable cash flow, as they paid a fixed amount of interest that doesn’t fluctuate like stock dividends can.

Bonds also help balance out a portfolio. That’s because bonds typically don’t move as sharply in either direction as stocks do, and when they do move, it’s often in the opposite direction of stocks.

Annuities


annuity saving retirement money grow

Annuities are insurance contracts that make a series of payments at equal intervals.

Depending on the annuity, payments can start immediately or sometime in the future. However, our suggestion for a baptism gift is deferred annuities, which are better long-term investments for custodial accounts because there’s ample time for the money to grow.

When you invest in annuities, you have several decisions to make. For instance, you must decide whether you want the annuity to pay out in a lump sum or a series of payments. You also can choose between fixed annuities, which pay a guaranteed interest rate, or variable annuities, which are riskier but can provide higher overall returns.

Insurance Policies


umbrella insurance policy protect

If you want a child to receive your life insurance after you die, make sure you arrange your policy in a way that will avoid attorney and court fees from cutting into their benefits.

You can designate that the proceeds from a life insurance policy are paid to a custodian who will hold it in a custodial account for the child. The custodian is required to distribute the funds to the child as per your wishes.

Money in a custodial account can only be used to directly benefit the child. The adult in charge of the account can’t spend the insurance money on themselves.

Related: 8 Ways to Invest a Lump Sum Life Insurance Payout

2. Savings Account


piggy banks saving money

What is a High-Yield Savings Account?

High-yield savings accounts are a type of federally insured deposit account that is designed to pay an above-average level of income.

To qualify as a high-interest savings account, the account typically must pay 20 to 25 times the national average of a standard savings account; however, this is subject to rate caps.

Many banking services have migrated online over the past decade or so. The advent of online-only banks has led to intense competition among financial institutions for your deposits. Many institutions have responded by creating high-yield savings accounts to attract your dollars.

Should You Open a High-Yield Savings Account as a Baptism Gift?

We think opening a high-yield savings account as a baptism gift is an excellent idea. These accounts are a very low-risk way to set aside money and prevent the child from spending it right away.

This gift works best if you don’t stop at adding money for the baby’s baptism, but instead continue to add money to the account for birthdays and special events. You can deposit cash gifts into the account or transfer money from your own account. The more money you add to a high-yield savings account and the longer the child waits to withdraw any funds, the more interest will accumulate.

This savings option might not be as lucrative as other investments, but it makes up for that with its safety and simplicity.

3. 529 Plan


529 plan college grad books education

What is a 529 Plan?

A 529 plan is a tax-advantaged savings account to save money for higher education costs. It’s one of the most popular ways to save for a child’s college expenses.

In addition to tuition at colleges, vocational schools, or trade schools, the funds can be used for other qualifying educational expenses. The money can pay for books, student loans, computers, housing, school supplies, and more.

Why Should You Open a 529 Plan?

College is a massive expense. So the fewer loans a student has to take out to afford it, the better off they will be financially after graduation. Having a college “nest egg” can reduce some of this pressure during college, letting the student focus more on their studies.

It’s easiest if parents set up a 529 plan for their own baby, then allow other relatives to add contributions.

If a child decides not to pursue higher education, the account can be transferred to another family member. There are also several exceptions when money can be withdrawn without penalty for non-education expenses.

Where Can You Open a 529 Plan?

You can open a 529 plan directly from a state or organization that sponsors the plan, or through a brokerage.

Backer is one of the best platforms for creating a 529 plan because they make it simple for friends and family members to contribute money at any time. When you set up an account, you receive a unique link to share with others.

You can add this link to a child’s baptism invitation, and guests can contribute whatever amount they see fit as a christening gift. The same can be done for birthdays, holidays, and other invitations.

Backer is a fun, social way to save for a child’s future education in a tax-advantaged account.

Related: 6 Best Godchild Gifts to Build Their Financial Future [Not Toys!]

4. Savings Bonds


savings bonds

What is a Savings Bond?

A savings bond is a loan to the government or a company that promises to pay the money back, with interest, when the bond reaches its maturity date.

Savings bonds work well as a baptism gift because the infant can easily wait until it has reached full maturity before cashing it out.

Where Can You Buy Savings Bonds?

You can buy paper savings bonds at banks or through payroll savings plans. Electronic savings bonds, whether Series EE bonds or Series I bonds, can be purchased at the TreasuryDirect website.

You’ll need an account to buy electronic savings bonds, and the recipient will need one as well. When purchasing an electric savings bond as a gift, have the child’s full name, Social Security number, and TreasuryDirect account number ready.

Note that you’re limited to buying a maximum of $5,000 worth of each type of savings bond, up to $20,000 total, in each calendar year.

Related: 10 Best Free Debit Cards for Kids & Teens [Earn, Save & Spend]

Mark the Baptism Date With an Enduring Gift That Builds Value


family religious celebration baptism godchild

Choose a baptism gift that will grow in value over time. By giving money or other financial gifts, such as brokerage investments and savings bonds, you will set the child up for a more secure financial future.

Infants don’t remember what presents they are given, and toys and trinkets easily break and get lost. But young adults will remember getting financial help when they needed a car, had college tuition to pay, or just wanted to go on a memorable trip.

But if you want to gift more than money, you can always pair a financial present with a sentimental card or a picture frame with a photo of both of you at the baptism.

Related: 10 Best Stock Trading & Investment Apps for Beginners

Related Baptism Gift Questions


questions and answers

What Is a Good Baptism Gift?

Engraved jewelry, a keepsake box and religious gifts are popular gifts.

But the best baptism gifts will benefit the child down the road. While you can provide cash, we suggest a monetary gift that grows in value, such as a savings bond or 529 plan contribution.

If you are close to the child, you might open a custodial account in the baby’s name as a christening gift, then purchase investments, such as stocks or index funds, on the child’s behalf.

The child will have expensive costs as they get older. Fortunately, money invested on a baptism date has years to grow by the time a child needs help with college tuition or a house down payment.

How Much Do You Give for a Baby Christening Gift?

The appropriate amount to give as a baptism gift depends on your relationship with the baby girl or boy and your financial situation. For example, a grandparent or godparent is expected to give a more significant baby gift than a family friend or more distant relative.

Your baptism gift should also be appropriate for your finances. A college student isn’t expected to give as much for the special occasion as somebody financially secure with ample income.

We’ll also point out that etiquette suggests the baby’s parents may give the godparent(s) a small present in return.

What Gifts Are Appropriate for a Christening?

A classic christening gift is often a personalized gift made of silver (for example: an engraved silver spoon). A keepsake box is another traditional gift for the sacred event.

Depending on the family, a children’s bible or other religious memento can also be considered an appropriate gift from a family member.

Other appropriate gifts for the baptism day might include a family heirloom, a photo frame, a stuffed animal (such as a plush lamb), or a prayer book.

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About the Author

Riley Adams is a licensed CPA who works at Google as a Senior Financial Analyst overseeing advertising incentive programs for the company’s largest advertising partners and agencies. Previously, he worked as a utility regulatory strategy analyst at Entergy Corporation for six years in New Orleans.

His work has appeared in major publications like Kiplinger, MarketWatch, MSN, TurboTax and CNBC’s Acorns. Riley currently holds areas of expertise in investing, taxes, real estate, cryptocurrencies and personal finance where he has been cited as an authoritative source in outlets like CNBC, Time, NBC News, APM’s Marketplace, HuffPost, Business Insider, Slate, NerdWallet, The Balance and Fast Company.

Riley holds a Masters of Science in Applied Economics and Demography from Pennsylvania State University, Bachelor of Arts in Economics and a Bachelor of Science in Business Administration and Finance from Centenary College of Louisiana.