Starting a debt management plan is a positive step towards regaining financial security. However, it will also mean that your family can no longer use credit cards to live beyond its means. Because you’ll have to curb spending, you’ll also have to start saying “no” to some of your kids’ purchases. They may struggle with the changes, but you can minimize friction by taking some of these steps:
Tell Your Children What’s Happening
Some parents want to shield their kids from every family challenge, but children often feel better when they know the truth. Tell your children about your debt management plan, but keep these keys in mind:
- Keep it age-appropriate: Let them know that you’re working to get up-to-date on your bills. Tell them that it means spending less money, but reassure them that they’re safe and that they won’t lack essential items like food and clothing.
- Avoid blaming yourself: Use the pronoun “we.” Say, “We have been overspending” or “We need to eliminate our debt.
- Avoid making promises: It’s easy to give your kids false reassurance by telling them that your tight budget will end soon. Unfortunately, you don’t know what the future holds. Also, you don’t want to return to the habits that got your family into debt. Acknowledge their fears, but avoid making promises that you can’t keep.
Involve Them in the Decision-Making
Let your kids negotiate items that they’re willing to give up in order to cut family spending. For example, they may be willing to mow the lawn and let the landscaping service go if you keep paying for music lessons. Also, involve them in on-the-spot decisions. At the grocery store, ask them whether they’re willing to give up name-brand cereal in exchange for a bag of chips.
Share Your Family’s Progress
Let your kids see that less spending is making a difference. If you get involved with a financial expert like Credit Guard, talk to them about the lessons that you’re learning personally. Show them how you’ve progressed on paying down credit cards or how much money you’ve added to your savings account. By involving them every step of the way as you get out of debt, you’ll help them to avoid similar problems later in life while teaching them the importance of an effective and efficient debt management plan.