Money Worries? How to Talk to Kids About Bad Economic News

If you’re worried about money or the economy, your kids can feel it. Here are some tips on how to talk to your children about money and uncertain economic times without stressing them out.

If you don’t live under a rock, your world has likely been rocked by doom and gloom predictions of certain financial ruin. It’s exhausting. 

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Are You Stressing Your Kids with Money Worries?

All of the words that are flying around now provide plentiful opportunities to teach our kids about money. But they seem downright depressing! Words like inflation, bear market, recession, and the occasional expletive when you happen to pull up to the pump can be enough to stress your kids (and you). 

Is the economy headed off a cliff? Honestly, I don’t know. I’m not an economist. But I’m old enough to remember having this feeling more than once before because I’m older than 15. 

In 2008, I was sure our home value would never recover, and in 2020, it seemed like the sell-off would never end. But here we are. 

Like every financial planner loves to remind us: it’s cyclical. Live long enough, and you learn to ride the waves. 

Shielding or Involving Our Kids?

Whatever happens, the economy is a grown-up problem. While we do not recommend shielding children completely from economic woes, we can be factual (in age-appropriate ways), non-emotional, and show them how they can participate in positive ways.    

Kids Catch our Moods

Kids are little empaths. They learn to read our moods. It’s how they know when to ask which parent for playdates and extra dessert. 

Of course, we can’t keep them from feeling any effects of real-world problems. That is a fool’s errand and they’ll know they’re just being kept out of the loop. 

But even during difficult times, we can give them that feeling of security kids need to grow and thrive. 

5 Ways to Talk to Your Kids About Money and the Economy

Here are 5 tips to protect kids’ mental health, even as parents might struggle through an economic downtown.

1. Act Like You’ve Been Here Before

Kids are easily scared when their parents are worried. They look to the grown-ups in order to respond appropriately. 

The simple fact is, bad economic news and economic cycles ebb and flow – go up and down – soar and crash. This is not your first rodeo if you’re old enough to have kids. Make sure your kids know that is the case. 

If they see their parents possess the confidence that comes from having been through one of these downturns before, they’ll be put at ease. 

Kids are great at reading facial expressions.

They know when feel anxious and when we’re stressed. Now is the time to teach children the benefits of resilience and calm. 

Do your best to ignore the 24/7 news cycle for a while.

Long-term investing is just that – long-term. Everything takes a hit at some point or another. As Warren Buffett is so famous for pointing out, you only lose money if you sell. 

Of course, we’re not billionaires, so not panicking when your retirement savings take a dive is easier said than done. 

However, panic never helped anyone, especially not kids who need to know that, come what may, everything will be okay. This is the best time to model those life lessons we want to pass down to our children.

2) Explain, Don’t Complain

Kids love to help their parents, especially when they sense that we’re stressed or worried. When we complain, it’s their natural instinct to try to help. 

Unfortunately, there isn’t anything they can do about this particular situation. The best thing to do is explain that to them in a way that makes it clear that it’s out of your/their control, but that it will be okay. 

Chances are that your kids will be called upon to weather similar times, and they will be much better off if they had a good example of how to do so. 

Money worries and volatile economic times come with plenty of opportunities to explain economic concepts to children. The more information and support they have, the better they’ll feel.

Difficult moments tend to be good teaching moments because everyone is paying attention. Here are some ways you can talk about money that will be useful to your child’s long-term success.   

What are Wants v. Needs?

This is the most basic lesson learning about money. Teaching your children what your family needs versus what your family wants will help them apply this lesson in their life as they grow-up and have to manage their own budgets.

What is a Budget?

Everyone needs a budget, but unfortunately, many Americans don’t have one. If you have limited quantities of money and an unlimited amount of wants (like most children and many adults), a budget will help you prioritize. 

We’ve built a budget calculator for kids to use with their allowance money as a first step to learning this valuable skill. 

What is Inflation?

Inflation is on everyone’s minds right now as we suffer at the pump and in grocery stores. Think of every trip to the gas station and down the dairy aisle as a mini lesson in economics.  Need help teaching your kids about inflation? Check out these adorable kids explaining it in a fun way. 

What is a Long-Term Investment?

This is the perfect opportunity to explain that long-term investing is meant to weather the volatility of the market.

What is a Bear Market?

Your child will feel very grown-up if they know the difference between a Bear and a Bull market. 

What does Value mean to your family?

Value means how much things are worth compared to their price. The value placed on something varies by family. This is the perfect opportunity to teach your family values as you decide what to buy and what to forgo. 

Learn more about how the My First Nest Egg app works in this guide for parents and kids.

3) Tighten Belts Together

Everything is better when you can do it together, and this includes tightening belts and saving money. 

Families are like sports teams. Everyone needs to be focused on a singular goal. 

And everyone needs to be willing to do what it takes to get you there. 

The good news is that kids love to be on a team. It gives them a sense of belonging and purpose. Giving them an opportunity to help the family can be good for their sense of pride and achievement – without causing emotional or financial stress.

So how can kids help the family tighten their belts?

As a family, decide where you shop for most of your wants. For our family, it’s Amazon. From there assess past purchases and find ones you probably could have done without. Come up with a family plan for how to limit those expenses in the future. 

Kids always seem to be coming home from school with a new request. How many parents have been ambushed on a Monday with notice of “Superhero Day” on Friday? 

Amazon and Target to the rescue! 

But what if we couldn’t just click a few buttons to buy the Wonder Woman shirt? We would have to make one or find a hand-me-down. 

The truth is, we’re all better off learning how to be crafty and thrifty, and a troubled economy might just be the best time to pick up this skill. Saving money can become a fun challenge.

4) Replace, Don’t Erase

No one likes being told that they can’t do something. Especially when they’re 7. But as money gets tighter, families will find themselves making choices that could be disappointing for children. 

Instead of telling the kids no, search for less expensive alternatives which provide similar experiences.  

Here’s the cool thing about kids. They don’t know what they don’t know. 

And they’ve only been around for a fraction of the time as adults, so there’s a lot they don’t know. 

There are so many fun, free things kids love to do. Here are some of our suggestions to help find inexpensive replacements for expensive activities. 

Find Your Local Kids Calendar

This is a perfect time to find local resources which list cool family activities and opportunities. Almost every city has a free resource online which lists free or inexpensive events for kids. 

Just search for “free kids events near me.” You’ll see a list of great opportunities.

If you can’t find one with a quick internet search, start with your local library. Libraries often have free activities for kids, including book readings and STEM days. 

Old Movies Are Cheaper (and often better)

Does your family love to go to the movies? This is an ideal time to introduce your kids to the matinee classics which often come with a greatly reduced price tag. 

This is especially true around the holidays when you can often find Hocus Pocus or Miracle on 34th Street at your local theater. 

Local School Theaters

When our oldest was a toddler we discovered the magic of high school musicals. No, not High School Musical. Actual high school musicals. 

We happened to be staying with a friend whose child was in their school play. Tickets were $5 for adults, and kids were free, and we tagged along. 

Our daughter sat in rapt attention for two straight hours. Ever since then we’ve tried to find local school productions to entertain our kids. 

Professional plays and shows are way outside of our budget, and kids don’t really care how awesome the props are, or whether the actors are very convincing. 

They just love the story, effort, and watching kids be dramatic. 

Vintage is In

Do your kids love to shop at the mall? It’s time to go vintage and start checking out local thrift and second hand stores. 

Fortunately vintage has been making a comeback and all jeans now look preworn. If this is a hard sell initially, start by shopping for them and finding one or two on trend pieces which you know they’ll love. 

Free Kids Days

Are amusement parks your thing? Look online and in local newspapers for free kids’ days and months. 

San Diego celebrates kids in October with over one hundred free attractions (including the San Diego Zoo!). 

Many amusement parks offer reduced prices and promos – some even partner with local libraries and schools to offer free admission for reading achievements. It’s just a matter of searching for and finding the best deals. 

Time is the Best Experience

73% of American kids want more opportunities to bond with their families. Kids love spending time with their parents. Showering your children with your time, love, and attention will create more lasting memories than anything you can buy. 

  • Take your children to the park and push them on swings. 
  • Plan a nature hike and look for plants and leaves. 
  • Create scavenger hunts for bugs and animals. 

There are an infinite number of experiences you can create for your kids with very little money, if you’re willing to put in the time.

This is the perfect time to be creative in what your family does for entertainment and fashion. 

It might not be easy at first, but it certainly could spark a love for simplicity, the 80’s, and nature. Everyone needs more of those in their lives. 

Make sure to talk to your kids about the money you saved, and the fun you had. 

5) Come Together

Difficult times often present opportunities for families to come together, because we need each other more than we might in more fortunate circumstances. 

A lot of siblings who grow-up without a lot of means learn to rely on each other. 

You don’t hear too many stories of the ultra wealthy crashing on each other’s couches, pooling resources to get an apartment, or splitting the bill for a Costco run. 

Necessity forces a bond which can last a lifetime. 

Sharing Expenses & Bonding

When I graduated from college and headed to law school I chose a school in a city where my older brother lived. He and I split an apartment (he had a well paying job so it was an 80/20 split in my favor). 

He took care of me. Because he could and I needed him. 

Later, after I graduated from law school, my little brother needed a place to stay and my husband and I took care of him. 

No family is perfect, but those years of needing one another to succeed and get by can strengthen the bonds formed in early childhood. 

Hard Times Build Character

Character can be forged in the fires of difficult times. Everyone is your friend when things are going well, but true character shines in necessity. 

In a family, this is an ideal time to learn to share and pool resources. Your children can learn to ask themselves what they truly need and how they can come together to help the family. 

Building a pitch-in mentality with your kids will benefit them all throughout life. They will be better friends, spouses, employees and employers. 


Everyone knows the old Irish prayer about being able to change what you cannot accept and accepting what you cannot change. We mere mortals can’t control monetary policy, the supply chain, or sales at Target. 

However, we can control our attitudes. 

Kids already have a hard time with attitude regulation. It’s why Mr. Rogers gave them permission to stomp their feet – so they don’t slug their siblings. 

They have big feelings in little bodies. If we think there’s a lot we can’t control, look at kids. They can’t even control when they use the bathroom – half the day it requires adult permission and a hall pass. 

So much of life is attitude. As Robert Frost famously said, “The best way out is always through.”

Our kids are going to experience money troubles and bad economic times, just like we have.

Now is the time to talk to them about money and how to get through hard times with a smile and a healthy attitude. 

When you emerge on the other side you just might find that your family is closer and more resilient than you ever imagined.