Should You Tell Your Kids You are a Broke-Ass?

We want our children to enjoy their childhood and really believe that the world is made up of cupcakes and lollipops as a means to protect their innocence. Some parents bend over backwards to try and maintain this image for their children when it comes to finances. This is a waste of time. Your children will love you whether you are a millionaire or a pauper because you are “mom” or “dad”.

So how do you break the news of being a broke-ass to your kids? Well depending on how long you have been a broke ass, it may be fairly obvious to even a young child when they begin to compare their assets to that of their friends. If their net worth of toys is less than “Suzie Rich Girl” down the block, they may start to harbor feelings of inadequacy. This is exactly why telling them you are a broke ass is not only a relief to you, but good for them.

Start by telling them that you want to discuss “family business” with them and that it stays within the family. It will definitely make your child feel more “grown up” as they are now being included in what would normally be a behind-closed-doors-discussion. Be honest with them, let them know that you are working your hardest, but that grown ups have certain responsibilities such as a mortgage, utilities, food, etc that are the priorities and that you may not have much left over to fund their toy bank. Keep it real with them and you will be surprised at how patient and understanding kids will be. If they know the situation, they are less likely to do the kicking and screaming bit on the floor of your local toy store.

Being honest with your kids about your family finances may seem difficult to do, but kids are resilient and understanding. There are a few ways that you can get your kids involved so that they will help improve the situation.

1. Have them cut down on waste: remind them to turn off their electronics, lights, etc. when they are not using them. This is good for the environment and will let them know that the less money you give the electric company, the more money you have to do things with and for them.

2. Ask them to evaluate their inventory: Take a weekend and go through all the crap in their closet, toy box, etc. They may find games, toys that they never used and can be traded in or sold for that new, fancy dolly that mimics human excretory functions.

3. Encourage them to save and pay for what they want. Mom & Dad are not a national bank and teaching your kids to use you as credit may set them up for failure later. When they want to buy something, encourage them to save their money. It may be tempting to buy it for them or to offer up the rest of the cash when they are short, but you are teaching a real life lesson. ONLY BUY WHAT YOU CAN AFFORD!

4. If they are old enough to read, have them search out FREE activities for the family online or in a newspaper. This not only gets them reading, but gives them a feeling of responsibility. You can even give them a fun title such as “Fun Director” or “Chief of Family Fun”.

5. Teach them to give. You may not have much, but there is always someone out there who has much less. While you are in the closet doing item #2 above, have them pick out a few toys to give to charity. Explain that there are children out there that are not as fortunate and would love to have as much fun with their toys as they did.

This may seem hard to do, but your kids will thank you for trusting them with such sensitive information. Of course, you don’t need to be too explicit in terms of brokeness, but keeping them a part of the conversation will make it easier on the entire family.