Child holds a gift in his hand.
Financial Literacy

Cash Gifts: How to Handle Them

For godparents and grandparents, it is often a challenge to find a suitable birthday or Christmas gift. Many decide to give a cash gift. The question then becomes, should my child be allowed to keep it all? You'll find recommendations from Pro Juventute and youth psychologist Urs Kiener here.

Children and young people normally receive small amounts of cash from their parents as pocket money. Thanks to cash gifts on special occasions like birthdays or holidays, however, these amounts can quickly multiply. Higher amounts from one-time events such as confirmation are not uncommon. In addition, cash gifts can be given without a concrete reason; some grandparents give their grandchildren a small amount of money each time they visit.

How do you deal with it?


years is the average age at which children are allowed to receive money themselves.

Source: Credit Suisse pocket money study

Letting Children Decide for Themselves

Pro Juventute generally advises that, if possible, you should let your children decide what to buy with the money themselves. Of course, the right approach essentially depends on how much money it is. You and your child can jointly consider what to buy with the money – for bigger purchases, it's best to plan together.

Cash gifts are a good opportunity to discuss greater wants and saving goals. It is best not to pressure your children, but rather to give them the chance of deciding for themselves. Exception: If the money has been given for a specific purpose – such as a new bike – then it should be used for that. One option, for example, is to arrange for a large cash gift to be deposited directly into a Viva Kids Savings account for the child.

Tip: In order to teach your child the value of a cash gift, sending a little thank-you would be a great idea. Grandparents, in particular, like receiving a self-painted picture or a photo of what was purchased, a letter, or a small home-made craft such as a bottle cap pendant

Comparing Cash Gifts with Pocket Money

Child and youth psychologist Urs Kiener explains that correctly categorizing the type of money matters. Comparing it to pocket money can help. If your child is given a few more francs one time, you can allow them to enjoy this "luxury." But maybe your child suddenly has ten or twenty times the amount of money in their wallet that they normally get each month. This can overwhelm your child because they probably don't know where to start with it. This is the perfect opportunity to talk with your child about long-term wants and saving.

Computers, Lego, and mopeds are children's most common saving goals.

These are children's saving goals.

Agreeing on Cash Gifts with Godparents and Grandparents

Pro Juventute advises that as a parent, you are aware when your child receives cash gifts from someone. You should therefore make an agreement with godparents or grandparents regarding cash gifts – preferably in advance. Also, agree with your children that they will tell you when they have been presented with any cash gifts.

If you as a parent have the feeling that, for example, the grandparents give your child money too often or the amount is too high, you can talk about it with the donors. Even regular cash gifts amount to increased pocket money and may undermine your plan for your child's education.

Gift savings account tip: One thing you can do is recommend a Credit Suisse Gift savings account to anyone would like to regularly provide the godchild with a cash amount. The child doesn't generally know anything about it, but will receive the money at a later time that the mentor is free to specify. It is often the child's 18th birthday.