All About Lunar New Year and Red Envelopes

Financial Literacy for Kids: Lunar New Year

Updated March 28, 2023

All About Lunar New Year In China

Xin nian kuai le!

Lunar New Year is China’s most important holiday, and 1 billion people across the world celebrate it. During this time in China, schools and businesses close, families cleanse their homes of “huiqi” (or inauspicious breaths), and ritual sacrifices of paper or food are made to ancestors. Families gather and feast, fireworks light up the sky and people mount scrolls filled with lucky messages for guests at their doorsteps.

Red Envelopes

But the tradition that really makes our BT hearts flutter involves the holiday’s signature red envelopes. Millions of these red envelopes, known as hongbao or li xi, are filled with money and exchanged physically or virtually as a sign of good fortune.

The red envelopes are gifted to children, relatives, friends and employees to bring energy, happiness and good luck into the new year. (Chinese employers gift red envelopes, typically a month’s pay, in a similar way western companies give holiday bonuses.) Most red envelopes are gifted from married couples to unmarried recipients.

Etiquette For Giving

Etiquette calls for giving money in the form of crisp bills (never coins) and in an even number (except for 4, given its associations to death). Red envelope recipients should take their gift with two hands saying “Happy New Year!,” and never open the envelope until out of the company of its giver.

Digital Red Envelopes

In a sign of the times, red envelopes have also gone digital. With the rise of payment platforms that allow for the easy transfer of money online (as well as pandemic disruptions to Lunar New Year celebrations), many now send and receive “lucky money” virtually through popular Chinese apps like Alipay and WeChat Pay.

What to Do With That Gifted Money

Whether exchanging red envelopes IRL or virtually, kids can consider how they want to put that Lunar New Year money to good use. Team BT recommends allocating new funds in the same way kids would with allowance…distributing between SPEND, SAVE and GIVE to make the most out of this special money moment.

Do you celebrate the Lunar New Year? If so, what do you do with the money you receive in red envelopes?