fifththird-125If you’re worried about the current economic conditions and what it means for your family, chances are your kids are too.  Below are some tips for talking to your children about finances and how the current situation is affecting your family.

  • Remember that kids live in a black and white world.  It’s a common reaction for people to joke about their economic predicament.  Unfortunately, kids don’t often understand the difference
    between a joke and reality and may literally think your family will end up on the streets even though you mean it in jest.
  • Be honest.  Give your children a basic understanding of your financial situation, but only provide them the amount of information appropriate for their age.  Reassure them that while you may need to cut back in places, you’ll still be able to provide for their needs.
  • Add context to financial conversations.  Showing older kids your monthly bills can help them gain a better understanding of your situation and identify ways they can contribute.  Seeing the actual bills and how you pay them is a good way to bring financial discussions to life.

  • Allow your kids to help. Doing so gives your children some sense of control of the family’s situation. Encourage your kids to help you find ways to cut costs or possibly save money. 
  • Use this as an opportunity to teach.  If asked how much something costs, don’t take the easy way out by saying, “a lot” or “too much.”  Go a step further and teach your kids the importance of money by illustrating how much allowance must be saved or hours worked to purchase what they want. 
  • Give kids a chance to manage money.  A great way to build your children’s financial foundation is to open savings accounts in their name. They’ll be able to see the value of savings as the account grows and will feel empowered by contributing to and managing the account.
  • Set a good example.  If you’re doing a good job taking care of yourself
    and managing stress, chances are your kids will too.