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Let’s Be Honest: Talking To Your Kids About Bankruptcy

Hard times can happen to the best of people. If you’re going through a bankruptcy, there is no shame in it. Bankruptcies occur for many reasons, a job loss, an illness, or even a poor investment. If you’ve made the decision to file for bankruptcy, you are on the path toward recovery. You may be wondering, however, what (or how much) to tell your children about your financial situation.

First, children are very perceptive and often know a lot more about what is going on than we give them credit for. The old adage “little pitchers have big ears” really is true. Your children have probably already sensed that something is not right and by keeping quiet, you are increasing their anxiety. When you talk to them openly and honestly, you will help to alleviate their fears.

Here are some tips for your sit-down with your children:

Tailor your message according to the ages of your children: Your message to your teenager should be different than your message to your six-year-old. While younger children require far less information, teenagers are capable of understanding the implications more and can even pitch in and help the family.

They don’t need to know everything: Don’t tell your children more than they need to know. Keep the message simple about what is happening and what changes the children can expect in their lives.

Be honest: If you were the victim of a job loss or other recession related misfortune, tell your kids. If credit cards got out of hand consider it an opportunity to share the positive and negative side of credit.   Showing them that you are taking control of the situation and not running away is a positive message.

Be reassuring: Let them know that the family is working towards this solution together and that it will be okay.

Financial stress does affect children, but taking these steps and successfully resolving your bankruptcy can go a long way toward righting the ship again.

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