Kids Feel Financial Downturn, Too

Nearly 10 percent of the U.S. workforce is unemployed. Dealing with losing your job can be hard. But the emotional toll of job loss also extends beyond the unemployed, to their kids. Kids often notice what's happening in the world and in their family, so if you lose your job or are affected by financial hardships, it's important to address your children's concerns.

How Children Are Affected

Children rely on their parents to feel secure. If you're upset or worried, chances are that your kids will be, too. Each child in your family may react differently to news about unemployment or belt-tightening, depending on his or her age and personality.

Younger children may hear about the economic downturn on the news or in other people's conversations. They may worry or become anxious because they don't understand what it all means. Also, they may think the situation is more dire than it actually is.

Pre-teens and teens might be most affected by a parent's unemployment. They're more aware of their family's financial situation and feel the social consequences of unemployment more acutely. For example, money might not be available for the extracurricular activities that they used to do.

Look for Signs of Stress

It's normal for your kids to be concerned if your family is having money trouble. But talk with your child's doctor if you notice changes in:

• Mood
• Behavior
• Friendships
• School performance

Other signs that can signal distress are changes in appetite, nightmares, and avoidance of situations or people.

Talk with Your Kids

It's important for you to talk with your kids about financial hardship. Not doing so will only add to your child's stress. Don't force the issue, but calmly discuss it when the time is right. If the right time doesn't present itself, try holding a family meeting.

Keep the conversation age-appropriate, and don't offer up too many details or figures when talking with younger children.

Here are some more tips to help your family cope with the economic downturn:

• Don't just talk -- listen to your children's concerns.
• Let your children know that it's normal to feel anxious or overwhelmed about economic troubles.
• Stress that you're actively addressing the family's financial situation.
• Use job loss to teach children about the wisdom of saving money for future uncertainties.
• Transform financial challenges into an opportunity to live fully yet simply with everyone in the family -- children included -- pitching in, helping out, and doing without items such as $100 sneakers.
• Play up the positive, including the strength that your family's love and loyalty provides in the face of struggles.
• Talk with other parents about how their families cope -- you certainly are not alone in these financially troubled times.
• Keep talking. If economic problems continue, children may need periodic updates about what's happening.