Is Talking About Finances In Front Of Kids Healthy, Or Should You Zip Your Lips?

Among the many "taboo" conversation topics out there, talking about money (understandably) brings with it a host of strong emotions, especially these days. And even though you know open, honest dialogue about finances helps you feel like you're on the same team with your partner or spouse, you might be wondering if these discussions are helpful or even necessary in front of your kids.

Maybe you can recall your own parents fighting over money when you were a kid, or perhaps you were made to feel bad about your family's financial situation in some other way. It's a heavy burden that most adults hardly feel prepared to handle, let alone a kid. You want them to enjoy every ounce of their childhood without feeling the pressures that adults must face, and it makes sense why you might instinctively shield them from talks about money to protect them.

But times are tough, and that likely means you're cutting back on certain things — a concept kids might not necessarily grasp. So, how do you preserve their well-being while still being honest about the fact that the family's spending habits might change? Jennifer Seitz, CFEI and Director of Education at Greenlight, is here to help navigate this sticky situation.

The Currency Conversation

Seitz notes that these conversations are a "balancing act" — especially if money is particularly tight — and there's no one-size-fits-all approach that works for every family.

"On the upside, being open about the family's situation can help kids better understand changes in the budget and learn more about money. Parents also can teach lessons in resilience and problem-solving. On the flip side, age matters. Younger children could feel worried by the idea of financial difficulties, while older kids might appreciate being regarded as a mature member of the family."

She points out a few things to consider when navigating the conversation, noting that approach also matters:

• Make the conversation age-appropriate: Seitz suggests keeping things simple and straightforward, especially with younger kids. "Focus on the big picture instead of the details," she says. "For example, if a parent has lost their job, keep it simple. Explain the basics that less money will be coming in until you find new employment, which helps them understand it is temporary. It's important to know where money comes from and be aware that it's not unlimited." With teens, she says you can "provide more context on the hardship and what it means in the immediate- and longer-term. Invite them to brainstorm ways the family could save more and provide input on areas where you could spend less."
• Focus on reassurance: Help them feel secure by "keeping an emphasis on the essentials, such as having a roof over their heads and food on the table," she says. "Try to remain optimistic in tone. If parents are calm and managing their stress well, kids will be less likely to become stressed."
• Break the money taboo: "Encourage open conversations and make your kids feel comfortable discussing money," she adds. "Let them know they can ask questions and talk about their feelings regarding the situation. This fosters a supportive environment and makes you a safe place to turn for money guidance."

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No matter your child's age, framing the conversation in a way that won't stress them out or make them feel guilty is absolutely essential. That said, you can also offer up bite-sized money management lessons that they'll remember for years to come, as Seitz points out.

• Mini money moments: "Involve them in financial decisions like holiday gifting, grocery shopping, planning a family outing, or deciding on an item to purchase," she adds. "This hands-on experience provides practice in weighing trade-offs and making choices within a set budget."
• Financial goals: "Discuss setting their own goals, whether it's saving for a special toy or game, or a longer-term goal, like college," says Seitz. "This teaches them about delayed gratification and builds confidence in their ability to achieve financial goals."
• Your family's financial values: "Talk about what matters most to you," she adds. "Explain how you're working to achieve your financial goals, whether your focus is to spend more on education, travel, giving back, or planning for retirement. Financial responsibility includes more than just budgeting, saving, and investing — there's also insurance against risks. You can even share your own stories about navigating the world of money as a young adult."

Seitz does caution against sharing some info with kids:

• Exact financial numbers: "Especially for younger kids, detailed information about your exact salary, mortgage payments, debts, or other specific financial details might be overwhelming or confusing," she notes.
• Stressful financial situations: "Avoid burdening kids with stress-related financial issues that are beyond their control," says Seitz. "Shield them from worries that might cause anxiety or fear. Focus instead on teaching them how they can achieve financial well-being in their future, starting with lessons they can learn today."

Even young kids pick up on their parents' or caregivers' energies, and they can tell when you're under stress or struggling even if you try to hide it. Keeping them in the loop about budgeting without putting any burden on their plate (or, worse, parentifying them) isn't easy, especially during times of financial hardship. Positive, age-appropriate conversations can help mitigate their concerns and manage their expectations as needed.