With the economy crashing at a heart-stopping rate, it's a major topic of conversation these days. And because most of us don't necessarily stop talking when our kids come in, they're hearing more than perhaps they should. (They hear everything, by the way, except when you're asking them to set the table. Then they're suddenly suffering from severe hearing loss.)
It's almost certain that your kids already know that the country is in serious financial trouble. What's less certain is if they know what that means for your family. And what's even less certain that that is how much they should know about your family's financial worries -- and how to talk to them about it.
When the steady paycheck that pays the bills is suddenly called into question, stress levels rise accordingly. When that paycheck has to stretch beyond any reasonable ability just to pay for the basics, it shows. Unless you're living on credit without a care in the world, your kids have probably noticed something. So it might not be such a bad idea to talk to them.
What they know might hurt you
Pick a time when you have at least 20 minutes that won't be interrupted, and where your attention won't be pulled away. Maybe go for a walk with your child, or find another way to have some time for the two of you to really talk. Start simple: "Tell me what you know about the financial crisis."
Be warned -- kids are smarter than we give them credit for being. And your kid may already know a lot about what's going on in the world, and what it means for your family. That can be hard to hear, but keep going. Let them tell you what they know, correct them if necessary, and let them ask questions.
Honesty is the best policy
Kids can see through a lie immediately, and if you lie to them, you can lose their trust forever. So make sure you give honest answers to their questions and concerns. When they ask, "Are you going to lose your job?" The right answer -- unless your dad owns the company -- is "I hope not, and I'd probably have some warning, but it could happen." You can follow that up, of course, with reassuring information like, "We have money put away in case one of us loses a job. We'd have to make cutbacks, but we could get by."
The idea is, you can't just dismiss your child's fears: "No, of course not! I'll never lose my job!" Yes, it sounds good for an instant, but remember how smart your kid is? He'll quickly figure out that if you're lying about that, you're probably withholding a few other truths as well.
How much information?
You probably don't need to tell your kids every detail of your financial lives, but you need to give them some basic parameters. A nice way to explain things to younger kids is, "We have enough money for all the things we need and some of the things we want. We have to make choices about where to spend our money." Older kids need more than that. Give them information they can use and understand: "I can keep paying for your guitar lessons, but you'll need to chip in for your brand-name clothes, or settle for Target like the rest of us."
It's also entirely appropriate to take the opportunity to teach your kids about how to live within your means. Work together to find a way to shave $10 off your weekly grocery bill. Create a running errand list and figure out the most fuel-efficient way to get the things you need. With a little creativity, you can create a life lesson your kids will never forget.