Character is the key

HelpMeSara’s Ten Tips towards….
Helping families cope with financial cutbacks

Normal parents want to make sure that their children don’t go without the necessities of life. However, many normal parents also feel guilty when they can’t give their children what the neighbours’ kids have. For some this may mean the latest in the line of technological gadgets or gizmos. For others, it may mean not having a swimming pool. Whatever the luxury, during these tougher economic times, many parents are having to re evaluate their spending habits, having to conserve and trying to find ways to ease their children into being happy with what they do have rather than focussing on what they don’t have. For many children, distinguishing between a want and a need is difficult. Unfortunately, many normal parents have established a precedent in regards to having their children expect the same as their friends, if not bigger and better. So what should parents do if they are struggling to make ends meet but want to ease their guilt about not always having the money to give their children what they want. Here are ten tips that might help you when looking at ways of dealing with cutbacks in your family:

1. Take this opportunity to reflect and re evaluate your spending habits. A crisis can also create an opportunity for change and an opportunity to gradually teach your children about the value of money by modelling wise spending and careful budgeting. Even if you have lots of money to spend, consider what you are teaching your child by continually adding to their material wealth.

2. Keep in mind that children are easily frightened by sudden changes and can quickly jump to the worst conclusions. A young child, for example, may worry about not having a house to live in if they hear you talk about not being able to throw them the usual birthday bash. The key is to cut back gradually and to not make an issue over not being able to afford something. Instead of having to talk about what you can no longer afford, consider how else you can spend your money more wisely. Instead of the $350.00 that you usually spend on a party venue and loot bags, plan a party at home with back to basic party games. Instead of loot bags, think of a creative less expensive way to thank the kids for coming. At a party that my daughter recently attended, the children were each given a chocolate bar with a note attached saying that in lieu of loot bags, a donation had been made to a children’s charity. By doing this, the parent was able to cut back, do a good deed and protect the environment from all the little loot bag toy items that often get thrown out before they’re worn out.

3. Help your child understand the difference between a need and a want. Do this at a quiet time when he or she will be more likely to listen rather than when you are in the toy store and run the risk of your child feeling as if he or she is being lectured at.

4. Help older children understand the value of money by having them contribute part of their allowance or wages from part time employment to items that are not necessities.

5. Watch how you model buying habits. If we buy on impulse, then it may be difficult for you to help your children step away from what they want to reflect and wait a couple of weeks to see if it is still at the top of their have to have list.

6. Best not to say “we can’t afford this anymore.” Children will again jump to terrifying conclusions about what will happen next. Instead, think of creative ways to tell them what they need to know and to help them learn about wise spending. You may rather say something like “I’ve been thinking that since you already have so many games and toys at home, that buying more is just adding to the clutter. Why don’t we go through the cupboard, give away what you don’t need and see if you really need another game like this. Perhaps we’ll even find something similar to it stuck away at the back of the cupboard.”

7. If you child insists that the item is really important to him or her, try saying something like “I know that you really want it. I know what that feels like. Unfortunately buying that toy wasn’t on my shopping list for the week. How about you think about it and if you really want it as badly in a couple of weeks, we’ll think of a way to make it happen.” Then, at that time think of a way to teach how to spend wisely – maybe do some research on the internet or through flyers to see where to get the item at the most reasonable cost, plan on how to save the money to get it (“if you put aside your allowance over the next two weeks, that’ll mean that you’ll have half of what you need. I’ll put in the other half.”)

8. Without alarming your children, gradually ease into including them in some simple budgeting for the household. First decide as an adult or as adults what you feel comfortable allocating each week towards your household expenses and then when you’re hanging out as a family, have that amount of money prepared from your monopoly set, real money or even create your own. Present this as an exciting activity – your children won’t even realize that they are improving their math skills! Lay all the pretend bills out of the table and then say, “how much do you think we spend on groceries during the week?” If necessary, break it down, “how much do you think milk costs? bread? Then, how much should we put aside for going out to see a movie and dinner?” At the end of the exercise see if you have anything left over. If so, then what are you going to do with surplus? What are you going to do if you’re short? Maybe borrow from the movie and dinner fund, only go to the movie but stay home for dinner so that you’ll have money in the other fund for a more important expense. By showing your children how to budget and allocate, they may be more sensitive to not spending frivolously and you are teaching them an essential life skill. Word of caution: if you and your partner fight when you talk finances, may sure that your children are not at home when you talk about money or not awake (it’s amazing what children hear even when you think they are asleep!)

9. Always try to have some money left over for a slush fund – treat yourselves to something fun at the end of the month – especially if you’ve been careful all month long.

10. Try to remain optimistic, even during tough times. Even if you can’t afford something right now, talk about how you make it happen as a family. Ask “how can we work together to make this happen?