Bankruptcy is a hard topic, and discussing it with your kids might seem even harder. Simply avoiding the topic will just make things harder. Here are some tips for discussing bankruptcy with your kids in an age-appropriate manner.
Preschool and Elementary School – Keep it simple and honest.
With younger kids, we as parents like to try and hide the bad news. We spend our lives trying to protect them. But when it comes to stressors like job loss, experts warn against hiding the news. Kids pick up on their parent’s stress, and if there is something amiss, they’ll pick up on it. Wondering what’s going on, only catching snippets of conversations, or overhearing the news second hand is more anxiety producing for kids than getting the straightforward truth directly from their parents.
Kids begin to be curious about money around the age of 5, although their perspective is still limited. Explaining that you have lost your job may just be an exciting time to your younger children because they will have more time with mom or dad. Other times, it can be much more complicated. Kids seem to think that the whole world is centered on them. Even with big things that are completely outside of their realm of control, like a divorce, layoff, or bankruptcy, a child may think that they did something that caused that event to happen. It’s important to free them from any feeling of guilt or responsibility.
Whatever you do, protect your kids from your own stress. Even if you don’t say it, or speak in code to a friend on the phone, children can feel your anxiety. Try to keep those conversations until the kids are asleep or away from home.Try to use this as a learning experience for the children and make money saving something that they can participate in, like coupon cutting, or having the kids pick food from the grocery store from “their shelves” (typically the generic and cheaper food is on the bottom shelves). Remember to still have fun while you’re saving. While you may not be able to pay the $5 per person for the swimming pool, you can still go to the park and play on the swings for free.
Tweens – Remember their thoughts and feelings matter.
Kids ages 9-12 are likely already aware that there are financial difficulties at home. It is harder to “talk in code” and they are smart enough to realize why the switches to generic food and non designer clothes are happening. They also know that each family has different financial circumstances. They compare their clothes and toys with their friends and peer pressure begins to hit them. Kids this age often feel disappointment that they don’t have the latest and greatest video game or style in clothing. Try to empathize with them and let them know it is okay to feel disappointed. Avoiding or minimizing their feelings can lead to kids shutting you out, sometimes permanently.
Teenagers – Allow them to help solve problems.
The teenage years are expensive and can be the most challenging years when parents are facing financial woes. Luckily, teens can also be part of the solution. While they should not be part of every discussion, older teens can be involved in some of the decision making. Involve them in brainstorming ideas when it comes to places to cut back or what cheap family vacation destination you can consider. Now is a great chance to help them feel important and that they have something to contribute, while teaching them about the importance of money, and that other things are more important than money.
Teens may struggle quite a bit since they may not be able to participate in the sports or other activities that they wanted, or they may fear that college is no longer an option. Help them to prioritize their desires and work with them to find ways for them to earn money to reach their goals themselves. Regular part time work or a summer job may not be possible with school and family schedules, but hopefully they can find something. Look at your neighborhood and see if anyone is hiring out for lawn mowing, babysitting, window washing, vacuuming, or anything else that your teen could easily provide.