Is your business facing bankruptcy? Then you aren’t alone. Last year, there were 794,960 filings for bankruptcy, according to the Administrative Office of the U.S. Courts. Deciding to file for bankruptcy is a tough decision that will affect your life for quite some time. And not just your life, but also those of your loved ones too. The stress and pressure that bankruptcy can put on a family is immense. Understandably as parents, we want to shield our kids from the difficulties that financial troubles bring. But often, the key to getting the family through troubling times is to be open and honest. That way, everyone can pull together and survive the difficult road ahead.
How does debt affect children?
Parents being in debt can negatively affect children’s behavior, says a study by the University of Wisconsin-Madison. Unsecured debt was most associated with a decline in children’s well being, mainly because of the stress it causes the parents. But much of the anxiety that children feel is actually down to not understanding what is going on. And while it’s not easy admitting money problems to your kids, honesty is very important. Telling them you’ve approached professionals for personal bankruptcy help in Scottsdale and that there is someone out there who can assist you, is one very important first step to take. When taking that step, you can include your family and children about bankruptcy. If all else fails, contact the FCW Law Firm to help in this trying situation.
Discussing financial problems with your children
Not telling your children that your business is going through bankruptcy, can actually do more harm than good. Children can often tell when their parents become stressed and worried about money, despite not actually understanding what’s going on. You might be keen to keep your business financial problems separate from your home life, but it will likely impact your family. Being honest and talking them through the situation, can help stop them feeling worried and confused and prevent any misunderstandings.
Start by reassuring them
Children aged eight to 17, often become aware of their parents’ financial issues, regardless of whether parents discuss it with them. If you do decide to tell your children, then think about what you are going to say first. Avoid any words or explanations that might worry, upset or anger them. Let them know what is going on and what it means for them, but reassure them that it will be alright.
It might not be easy, but there are many positives to taking the time to discuss the situation with your children:
- An opportunity for children to learn about money. This is an ideal time for your children to learn a valuable lesson about money, savings, bills and budgeting.
- Teaches children about the important things in life. Sometimes it takes a crisis like bankruptcy to help us truly realize what’s important. Take the opportunity to teach your children that the important things are family, friends and being happy and healthy. It’s not all about money, toys, clothes and vacations. You can show them that despite the situation, the family can still be happy and enjoy time together.
- Chance to reassure them that it’s not their fault. Children often internalize their parents’ worries and could end up taking on the emotional burden of the bankruptcy. So, make sure they know that it’s not their fault and not their burden to carry.
Show your kids that you can still have fun as a family (even on a tight budget)
You might not be able to go out shopping or go on expensive vacations, but you can still all have fun together. Get together to find free or cheap activities that everyone can enjoy. Find out what’s going on in your neighborhood, explore parks, take picnics, visit forest reserves and check out free admission days at museums and other attractions.