How to Prevent Your Kids from Experiencing Financial Stress
Money stress is a common concern for many parents, but did you know that it can also impact your children? According to a study conducted by Amy Weimer, director of the School of Family and Consumer Sciences at Texas State University, children are more likely to feel worried if their parents are experiencing long-term financial stress. This goes to show that as parents, we need to take steps to prevent our kids from experiencing financial stress. In this article, we will explore some strategies to help you do just that.
One of the first steps you can take is to seek financial counseling if you are experiencing financial strain. Weimer suggests that parents should address their debt and seek professional help if needed. By taking control of your own financial situation, you can prevent it from trickling down and impacting your child’s mental well-being.
Talking about money with your children early on is another effective way to prevent financial stress. Justin Rush, a certified financial planner and founder of JGR Financial Solutions, recommends having discussions about money during neutral moments. For example, while driving with your child, you can discuss the price of a McDonald’s Big Mac and use it as an opportunity to talk about inflation. These conversations can lead to discussions about budgeting and other financial lessons, setting a baseline for comfortable money conversations.
Kimberly Watkins, an assistant professor in financial planning at the University of Georgia, emphasizes the importance of starting these discussions early. She suggests that parents can start talking about money with children as young as three years old. Avoiding the topic can create a “generational cycle” of financial unawareness, which can ultimately lead to more money stress.
Learning about finances can be a family project that benefits both parents and children. Watkins suggests exploring resources like the “Money as You Grow” website from the Consumer Financial Protection Bureau. This website provides ideas on topics to explore together, such as the financial ramifications of buying a pet or moving to a new house. Your bank or credit union might also offer additional online resources to help your family.
When discussing money with children, it’s important to consider your language choices carefully. Using phrases like “we don’t have the money for that” can be confusing for children who interpret words literally. Pam Horack, a certified financial planner at Pathfinder Planning, suggests saying something like “That’s not in our budget right now” instead. This small language shift helps children understand that parents make choices and trade-offs when it comes to money.
Megan McCoy, an assistant professor in the personal financial planning department at Kansas State, also advises being mindful of how you talk to sons and daughters differently about money, even if it’s unintentional. Studies have shown that daughters are more likely to receive messages about saving, while sons are more likely to receive messages about earning. These messages can impact their risk tolerance and career choices.
During times of financial hardship, it’s important to be straightforward with your children. Weimer suggests sharing the news in an age-appropriate way rather than trying to hide it. By being open about the situation, your children will feel less anxious. Reassure them that some things won’t change, such as your ability to provide food and shelter, while explaining that other expenses may have to be cut back, at least temporarily.
In some cases, children can contribute to the household during a financial hardship. Weimer suggests that teenagers can help reduce parental stress by taking on additional chores around the house. This not only helps them regain a sense of control but also contributes to the overall family well-being.
Preventing your kids from experiencing financial stress requires proactive steps from parents. By seeking financial counseling, talking about money early on, learning together as a family, choosing language carefully, being straightforward about financial hardships, and involving children in contributing to the household, you can create a more financially aware and resilient family. Remember, by addressing your own financial stress, you can protect your children from unnecessary worries and set them on a path to financial well-being.
