Howto explain family’s financial hardships to children

This holiday season will be like none other.

Coronavirus cases are surging in the United States, and this may force states and local governments to impose new lockdowns — meaning more people might find themselves out of work.

An eviction crisis is looming as people lose their jobs or run out of unemployment funds and can’t pay their rent.

Yet, this is the time of year when spending is celebrated. The mall Santa is still greeting children — albeit behind masks and plexiglass — listening to their excitement over the presents they hope to get for the holidays.

But what if the pandemic recession has affected your family finances to the point that the usual treasure trove of presents and lavish holiday meals aren’t possible? What do you tell your children about the scaled-down Christmas or Hanukkah you need to have this year? Or worse, how do you prepare your children for a possible eviction from their home?

I asked Neha Chaudhary, a child and adolescent psychiatrist in private practice and a faculty member at Massachusetts General Hospital and Harvard Medical School, to help guide parents on how to talk to their children about their financial situation. Here’s her advice.

Q: What should parents tell children if they’ve lost their job or face a furlough? Chaudhary:

When breaking bad news to a child, you want to meet the child where they are by asking what their understanding of the topic is. A very young child may not understand the implications of something like losing a job in the way a teenager would. If you first find out exactly what they know about the topic, you’ll likely be more equipped to share the news in a developmentally appropriate way and can fill in the gaps if they’re confused.

Older kids may wonder about broader implications on the family and have practical questions about whether this is temporary or what happens if you can’t find something right away. Younger kids will likely worry more about things that affect them day to day, like whether they’ll still be able to get presents, or they may not realize the implications at all.

The more direct you are the better, because children pick up on uncertainty and ambiguity, and that can make them feel more stressed than the actual content that you’re delivering. Older kids especially will know when you’re sugarcoating something and might find it frustrating or dishonest.

No matter the age of the child, the burden of figuring out next steps or worrying about what to do should fall on the parents, not the kid. Reassure your child that they are still safe and you love them very much. Make sure to offer them the space to share their feelings, including their worries, confusion or fears. Children need to feel like their worries are heard and acknowledged so the worries don’t stay in their minds and amplify.

Q: Should you share a lot of details about your dire financial situation? Chaudhary:

Parents should be honest, but kids don’t need to know all the little details of which bills can and can’t be paid, or how much stress the parents are under. The focus of the conversation with kids should be to share the high-level news of a job loss, explain what directly affects them and review some day-to-day changes that the family will face.

Q: What if the money is so tight that buying presents for the holidays is just out of the question without incurring debt? Chaudhary:

If money is extremely tight, parents should consider sharing with their kids that the holidays might look a little different this year than in previous years. Explain that it might look different from their friends’ holidays, too, and that that’s OK, because every family is going through something different.

It’s a great time to focus on forms of giving that are thoughtful but don’t cost much, like a family drawing night, cooking meals together, writing each other stories or making each other a coupon book of things you’ll do for one another. Just because you don’t have money doesn’t mean you can’t give or celebrate the holidays in a meaningful way that your child will cherish and remember through their adult life.

Q: What if the family is facing eviction? How do you prepare children for the loss of their home? Chaudhary:

A child needs to feel safe, loved and secure. Find a way to remind them that it’s OK to be scared or sad, but that you’re going to find a way to protect them and that you will get through it together.

Q: What should you do if your children start acting out because of the change in the family’s financial situation? Chaudhary:

If your child starts acting out because of the change in the family’s financial situation, try to acknowledge how frustrating it must be to be in their shoes, while gently reminding them that you wish things weren’t the way they were. A small dose of empathy can go a long way.