Money is an excellent tool to teach kids how the world operates. You can use financial principles to teach them about social issues, too. That's because money is about values, relationships, choices and self-worth.

Teach your kids good financial values while they're still under your influence and authority and you'll give them the tools they need to do well in the real world.

Lesson #7: Gift-giving is an important part of life

Fair exchange (not getting ripped off, making sure you get a good deal) is at the center of most of the financial life skill lessons we've discussed so far.

That is not exactly true however in this lesson on gift giving and receiving. This is an area where the heart comes first. That doesn't mean you let your emotions run wild while your brain takes a vacation, only that you need to allow yourself the experience of sharing from your heart.

Principle: Giving gifts tells people that you care about them. Giving also keeps you from becoming greedy and self-centered.

Your family probably has a general gift-giving calendar as well as family rules and guidelines. For example your family might celebrate Christmas and also each person's birthday. Each member of the family exchanges Christmas gifts, but birthdays are remembered with cards and a family outing. Or perhaps you and your siblings pool your resources to buy one gift for your mother on Mother's Day.

Or maybe you don't have any set standards or guidelines. That's okay for now. And once you figure out your values in this area of giving and receiving, you might want to suggest the family set up some guidelines as well.

Plan in advance

This is the first rule of gift-giving. You need a special gift-giving calendar on which you write all of the holidays that your family traditionally exchanges gifts. Don't forget birthdays, anniversaries, graduations and other special events that will require something from you.

What is a gift?

A gift is about thoughtfulness. A gift says, "I care." It doesn't really matter how much the gift costs. A gift that is very expensive doesn't say "I care" any better than one that costs less. What says "I care" more eloquently is the amount of thought that you put into the gift.

This should help ease some of the stress you felt when you saw so many gift-giving occasions on your gift-planning calendar! You don't have to spend a lot of money to give a very meaningful gift.

Overdoing it

There may be times that you have this strong desire to go overboard and spend way too much money on a gift. That's when you need to stop and ask yourself:

Am I trying to get this person to love me more?

Am I trying to buy this person's approval by giving the biggest gift?

If you have to admit the answer to either question is yes, beware! That's the first sign of an unhealthy materialistic attitude. Just remember that gifts cannot make anyone love you more.

What matters?

Don't know what to give that person? Ask this simple question: What matters a lot to him or her? You have to know this person pretty well to know the answer to that question without asking them. You almost have to be a detective. You have to pay attention, listen and observe.

Let's say your grandmother really loves animals. In fact she volunteers at the shelter two days a week. She is passionate about animal rights. Donating $10 in her name to the Animal Shelter would probably make her break down and cry. Not because she's sad, but because she is so touched that you cared enough to figure out what really matters to her.