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Are Economic Woes a Family Matter?

Do your kids know about the economic woes of our country – and are they aware of how it affects you – or them – in the daily lives you lead?

What is happening in our economy right now is beyond belief.  The biggest bank failure in our nation’s history, warnings of an “economic catastrophe,” and the “worst economic downturn since the Great Depression” lead the daily headlines.  Everyone is predicting it will get worse before it gets better.  So how does all this affect you? 

This Zen Mama Wannabe wishes I could peek into people’s houses on the talked about Main Street and listen in on the kitchen table conversations.  Does this downturn just mean a dip in your 401K plan, but retirement is years away so no real worries, you will just ride it out?  Does that mean you probably won’t be taking that vacation to the Caribbean next year and will have to make due with local weekend excursions here and there?  Or does it mean you are upside-down on what you owe on your house, last month’s mortgage payment was late and you are not really sure you can afford new tires for the truck AND starting your son in braces and are trying to decide which takes precedence?

What do your kids know about these current events?  Obviously it depends on their ages, but are they at all aware of what is happening in the country – and maybe in your home?  Is it wise to share this information with them?  Or would it cause them to worry about things they ultimately have no control over?  But then what do you say to them when they plead at you for the latest Disco Dance Revolution game or private guitar lessons?   

A friend of mine chose to remain silent when she and her husband were short on their bills last month and needed to take out more debt on their credit card just to cover the basics.  This meant not making the requested “donation” to her 11-year old daughter’s school during the main fundraising drive.  The donor names were all published and some other child said something to her daughter about not being on it.  Her daughter was embarrassed and became mad at her mom, who after this whole thing blew up into a big mess, went and made the donation – on her nearly maxed-out credit card.

I feel my friend’s pain, and asked her if she could have done it over, what would she have done?  She said she should have just made the donation when asked (on the overused credit card) and spared her daughter the humiliation.  What would you have done?  This Zen Mama Wannabe has mixed feelings, but I just cannot help but wonder if there were some teachable moments there that got passed-by?  Is 11 years old too young to understand a family’s financial struggles?  Should children be privy to any of that information – at any age? 

“We’re not rich,” my son told me.  Oh really?  Why do you say that?  “Because we don’t have a Wii.  A Wii costs like $300 – if you have that, you are rich!”  Hmmm. 

I am perfectly okay with him thinking that, except I get a little concerned with what gets said at school.  It amazes and terrifies me what get talks about among kids and I know I hear only the very smallest amount. 

“I don’t like George Bush,” my son announced at the end of the last school year.  “He is against the environment.”  Why do you think that, Buddy? “Oh, he cuts down lots of trees.  That is bad for the environment.” I see – and who told you that? He names the child that did, and it all becomes clear.  A child hears something from his parents (or possibly another friend or from the TV, etc.), takes one or two lines of it – sometimes completely out of context – and then passes it around.  It is like that game of Telephone, where you say something to one person, and then they pass it on to the next, and by the time you end up, you usually never have what you started with.  Only here no one thinks they are playing a game.  These are "facts" they are sharing, and when it comes to personal info, it can be a little disconcerting.   

I think back to my own childhood.  My mom tells the story of right around the time I was born, my self-employed father lost his 2 biggest accounts.  Talk about tough times – and with a new baby to boot.  But because my parents knew how to stretch a dollar (and a casserole dinner) I never perceived lack.  I felt I was lucky to have my mom and my grandma sew dresses for me – and my dolls and Barbies as well. I grew up thinking a dinner at McDonalds was a big treat, for we hardly ever went out to eat.  My play-pretend kitchen was made out of orange crates, with some wood fastened on for the oven door.  I loved it.  I was devastated when I didn’t get the Barbie Townhouse I wanted so badly one Christmas.  But the thought that perhaps my parents couldn’t afford it – or that they thought it was an unnecessary, overpriced item I didn’t “need”  – never crossed my mind. 

Of course times are a bit different now.  Things are much more commercialized; people (and therefore kids) seem much more materialistic.  It is a fast-paced, high-tech world and it comes at a cost.  But what is the message we are sending our children?  Should they know that times are tough financially – or should they be insulated from it all?  Are there some teaching moments for them in this mess, or are the lessons really just ours to learn? 

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5 Responses to “Are Economic Woes a Family Matter?”

  1. Tonggu Momma Says:
    September 26th, 2008 at 12:17 pm

    This topic fascinates me.

    The husband and I will be fine… our lives will not be exactly the same, but we will be able to stay in our home and live life as we typically do, with limited tightening. But we’ve always lived pretty simply, although not exactly frugally. Now, if we were approaching retirement, I would be concerned, since our investments took a hit, although not a large one since I’m the world’s most fearful investor.

    Two families among our relatives are in a world of hurt. The common theme there is that both families overextended themselves… by a lot. They bought houses they couldn’t afford, carried credit card debt and then had something significant happen (medical issue, job loss, something).

    As to parenting during these financial times…

    Since the Tongginator was a toddler, I’ve modeled financial behavior I hope she comes to emulate. For example, if I see something at a store that I like, I will say quite openly, “that is very nice. I really like it, but I don’t need it.” I’ve even been known to say, “I really like that, but we can’t afford it this month.” We also limit her access to commercial TV. This helps more than I can say. She rarely asks for things, even in stores, although she’d really like a scooter “for Christmas.” (She is the only child on our block without one.)

    I think eleven is old enough to know that things are now different. I think children need to hear reassurance that they will always have food, shoes, someplace to live, but they need to understand that life is changing for them.

  2. callieandbatido Says:
    September 26th, 2008 at 7:00 pm

    This is such a hot topic for us all right now. I have watched a friend whose husband got a huge promotion, struggle. He got a $30,000 raise but didn’t realize the cost of moving. They are upside down on their home as they sell it, to the tune of $50,000. How do they buy a house when the move? This exciting promotion has turned into a nigtmare. I have to say, it scares me. Luckily, we live within our means, without huge debt. But if things get worse, can we afford to live our current lifestyle? I’m not sure. As for what to share with our kids…that’s a hard one. I do think that we need to help them understand that times are tight and that everyone has to curb their spending. Modeling fiscal responsibilty, like Tonqqu Momma does, is pricelss. The years of entitelment are over. Time to tighten our belts and start making casseroles.

  3. Zen Mama Wannabe Says:
    September 27th, 2008 at 9:17 pm

    Yes, Tonggu Momma is on to something with the dialogue she uses with her child! That is an area I need to work on – I am definitely going to start incorporating that with my kids.

    Children in general need to understand that they can’t just get everything (material) that they want. Sometimes you have to work and save for something, and sometimes you just can’t get it at all. It is okay – life DOES go on (think of me and that Barbie Townhouse – although my husband can’t believe I am STILL talking about it, after all these years!) 🙂

  4. Sheri Says:
    September 29th, 2008 at 10:08 am

    I agree, it’s so important to model responsible behavior from the start. Whether you can afford things or not, kids don’t need to get everything they want. They need to learn to wait, to earn it, to delay that gratification. Because that’s life. My sons know not to ask for things, because when they were little we couldn’t afford anything, and that set the tone. We’ve always explained that bills get paid first, and it was so funny when they finally “got” that, because kids don’t know about or understand bills, or house payments, or saving for college and retirement.

    It’s great because now that they’re older and they do understand, they don’t whine for stuff. They might ask, cause it never hurts to ask, but they don’t really expect it. They both have little jobs they do to earn they’re own money, and they’ve been taught to save it til they’re really want something instead of blowing it on candy at the Dollar Store. And, sometimes they still choose to blow it. But it’s their hard earned money,and they definitely think hard before spending it.

    I don’t want my kids to grow up and think money grows on trees, or that they will graduate and instantly make a 6 figure income. I want them to know there will be lean times. I don’t think that’s scaring them, I think it’s preparing them for life.

  5. Zen Mama Wannabe Says:
    September 29th, 2008 at 5:04 pm

    Just heard some TV personality say she wished they had taught a course on MONEY MANAGEMENT in school…that it would have done a lot more for her – and others – than triganometry did. 🙂

    Sounds like that is what you guys are doing with your kids on your own. What an important thing to teach! I agree, Sheri – it is preparing them for life!

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