Don't be hands-off on money TALKING TO CHILDREN

BY KIM BAER

Summer camps are getting axed.

Summer vacations at the beach are being traded for fun in the 'burbs.

These topsy-turvy financial times have parents putting the kibosh on non-essential expenses.

Eighty-six percent of parents who responded to a recent survey on Momcentral.com, for instance, planned to cut camps or vacations because of the economy.

These aren't the only items on the chopping block: 48 percent of 1,197 survey respondents reported that they have cut back on other expenses for their children.

The kids may not be jumping for joy right now, but family and personal finance experts see a potential bright side for our offspring in all of this curtailing.

"I think that maybe these difficult financial times are a good opportunity for us to teach our children to be financially responsible," wrote Holly Schiffrin, a psychology professor at the University of Mary Washington and a certified parent coach, in an e-mail.

Rearing financially responsible children requires parents to model wise spending, explain the difference between needs and wants, and teach them about saving and budgeting.

This informal financial education can begin as soon as a child is old enough for an allowance, according to Tom Howlin, a business professor at Germanna Community College who teaches personal finance.

The first step is for parents to review their own spending habits, said Sara Dimerman, an Ontario-based family therapist and author of "Am I A Normal Parent?"

"As parents, we are our children's primary role models," Dimerman said in a phone interview. "They do what they see from us, rather than what they hear from us."

Modeling wise spending in daily life is worth more than hours of lectures.

Look for those "teachable" moments, such as when you see an item you'd love to buy and your child is with you.

Let your child see you resist the temptation.

"Say to your child, 'You know, I really love that item, but I'm going to have to wait,'" she said.

Be wary of whipping out the plastic in front of your child.

"If we are going into stores and seeing something we like and putting it on credit, spending money we haven't already earned," Dimerman said, "we are modeling something we may not mean to model."

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Keep discussions positive, advises Sara Dimerman, an Ontario-based family therapist and author of "Am I A Normal Parent?"

Rather than saying "we can't afford this anymore," for instance, try "it's not in our budget."

If you're cutting out sleepaway camps or summer trips, be sure to replace them with less expensive activities, said Stacy Debroff, chief executive officer of Momcentral .com.

"Make it fun," Debroff said, "so that it doesn't feel like a takeaway, but like a different type of adventure."

Let your child see you making changes, such as packing a lunch instead of eating out, Dimerman said, or shopping at a less expensive grocery store.

Be careful about having serious financial discussions, Dimerman said.

"Children will often jump to terrifying conclusions about what will happen in their lives," Dimerman said.

If you have lost your job, for instance, keep the discussion brief and reassuring, Dimerman said.

Try something like this, she said: "It's hard on me to have lost my job, and it might be a difficult few months, but I am optimistic I can find more work. We are together as a family and we can work through this."

Date published: 3/31/2009

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