Talking to Kids About the Economy

Posted by Cathy Mahady on Wednesday, October 7th, 2009

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Here is some great advice I received in our school newsletter from Lisa Weir, M.Ed., Parent & Family Educator about how to talk to kids about the economy.

It is inescapable, and impractical to try and shield our children from the current economic realities. Doing so, can actually create more insecurity and misses an opportunity for learning and understanding about money and the things your family considers valuable. So whether your child is learning about the economy from the news, overhearing conversations in your home, from the next door neighbor, or from school you can help them by talking about it with them.

Diane Levin, Ph.D., professor of education at Wheelock College, says the best approach is to find out what kids already know about the economy and respond accordingly. Say to children, “There have been a lot of news stories about jobs and money lately. Are any of your friends talking about that?”

Here are some guidelines for helping your children cope with unstable economic times:

AGE APPROPRIATE EXPLANATIONS: Be open and honest, but be careful about overburdening them with more information than they need to know. Listen and answer their questions in an age appropriate way, remembering that their primary need is to know that they are safe and supported regardless of economic conditions. Maintain routines as much as possible.

OLDER CHILDREN (9-13): This can be an opportunity for them to learn about money management, by earning money and saving for the things they really want but are not part of the current family budget.

TEENS AND ABOVE: The economic crisis can be a powerful learning opportunity to discuss cyclical trends, capitalism, consumerism, budgeting and values.

AVOID PHRASES LIKE: “We are going broke.”, “We are going to the poor house.”, “We have no money.” These words can create a significant amount of fear and guilt in children.”

HELP CHILDREN LEARN: Life is full of ups and downs, economic and otherwise, but relationships with family, friends and neighbors are priceless and can last a lifetime so they should be nurtured regardless of economic conditions.

GET KIDS INVOLVED: In coming up with low or no cost ways of having fun. Discuss ways that everyone in the family can help when there is less money available (i.e., clipping coupons, searching on-line deals, contributing items for a family garage sale, conserving energy by turning off lights, electronics, etc.).

REASSURE YOUR CHILDREN: Your family is not alone. Most families are affected by the economy and everyone is learning how to change their lifestyles in some way (even if it doesn’t seem like it).

HELPING OTHERS: Is a great way to take the focus off of what you don’t have or are unable to do and a great way to re-focus on what you can do to help someone else. Maybe your family could help an elderly neighbor rake leaves, or make a pan of brownies for teachers at your school, or babysit for a friend while they grocery shop. The possibilities are endless.

Whatever your specific situation in this economy, truthful, age-appropriate and respectful conversations with your children will help them to develop self-confidence and problem solving skills that will endure long after the current economic crisis is resolved.

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Tags: current economic realities, economic conditions, economy, family budget, learning about money, Money Management

Filed in Money Management | 2 responses so far

2 Responses to “Talking to Kids About the Economy”

Jason Kerchneron 08 Oct 2009 at 9:26 am 1

Excellent advice. Many parents go to extremes, either completely pretending that financial problems don’t exist, or making the situation sound desperate. The first doesn’t give kids an appreciation for money, the latter makes them slaves to money by creating fears about not having any.

I’m not saying times aren’t extremely difficult for many people, but neither panicking nor ignoring the problems will help.

Focus on the positives, on what you are doing to correct the situation.
Jason Kerchner´s last blog ..Applying the Law of Attraction the Napoleon Hill Way
Cathy Mahadyon 08 Oct 2009 at 10:52 am 2

Thanks for that perspective Jason. Isn’t it fear that caused the whole downfall in the first place. Well, that and greed and corruption. But creating fear and panic played a major role in why things ARE so difficult. So you are right about the need to balance the information we provide, both to the children and adults in our lives.