Hi guys- I'm new here and ready to take control of my finances.

We are badly in debt, like many people. My major stumbling block right now is my children. If it were just me, I would have no problem cutting back, making sacrifices, etc. What's making me sad and fearful is the idea of my children going without. How do you cut back on Christmas? How do you explain that you won't be making the yearly family trip to the beach? How do you look them in the eye and tell them you're canceling the cable? How do you say no to the youth church trips and movies with friends and dance team?

How many parents are here? Most are willing to make all kinds of sacrifices for their children- including shouldering debt so that their kids can have the things they need and want.

Has anyone here struggled with this?

I don't pretend to know what it's like to have children, but saying "no" will not only help your pocketbook, but it will help them in the long run. They will, hopefully, learn to value people and relationships more than "stuff," and perhaps have their imaginations nourished in coming up with unconventional ways to have fun. I know that the things you list are important to you and your family, but honestly - going without cable is not "going without." Unless it's really your only major extravagence and you live in a really bad neighborhood, work two or more jobs, and simply want your children to have a lot of things to do inside the home while you're gone b/c it's not necessarily safe for them to go outside. I would give it to them straight and tell them that sacrificing might be painful, but it will pay off in the long run. Try to involve them in things that will help you reduce your debt, for example, coupon clipping, eating out less and teaching them to cook, etc. You're doing them no favors by having a lot of consumer debt and teaching them that they can have everything they want at the swipe of a credit card.

Things they need: understandable

Things they want: not understandable.

I grew up in a poor family. Sure, as I kid I wanted to eat at Chuck E Cheese and have Legos and Nintendos and stuff. Sure I was upset when my parents said no. That is, until Istarted to earn my own money and I saw how things worked.

Going into debt to please children is an easy way to start a cycle of debt that lasts generations

Hi...I know what you mean exactly. We have three kids and I told my husband just today that's it so easy to go without for yourself but you always feel bad for the kids. Now, we are not what I would say badly in debt. We have our mortgage on our house, one on a piece of property we bought, the orthodontics bill we pay every month at no interest and roughly 1,000 dollar plumbing bill we just got today...

And I struggle with it everyday. I guess we've always lived maybe a 'simpler' life than some although I'm not sure anyone realizes it until we go out and compare. They don't have video games, or Gameboys or Wiis but that's because we as parents couldn't stand the noise or endless staring that seems to go with it. But that doesn't mean they don't ask. We tell them you will never have a Wii, a DVD player in a car or an Ipod in this house. We even said no to the grandparents buying them one. They are 9, 10 and 11 by the way. Boys too and so far no interest in fancy clothes (do boys ever have this interest???) or anything like that...

But it would be exceptionally hard to say no soccer this year, or swim team or baseball. It would be hard to say no, you can't go on the fieldtrip with church or scouts...it would probably honestly make me feel very very sad because in my mind those are not consumables. It's not a video game that will break or a trendy thing they'll get tired of. They keep active, they learn skills and teamwork, they know how to take a loss and be gracious winning....my boys love those activities.

I honestly think kids change the debt/saving playing field. Because even if we save about 13-14% a year with 401k and Roths...I'd be aggressively paying down the mortgage and being way way more liquid every month....it's not a question of spoiling them, it's a question of balancing it all together...they do get free music lessons at school and there is a free parks and rec program in summer in our little rural area...

If you are badly in debt, and that's different for everyone, but if you are in danger of losing your house or can't put food on the table, then it's time for super drastic measures...I don't know how old your kids are, but if they are little, it's real easy to start making change, talk up a picnic in the park or the big slide there and they'll eat it up, if they are older, I don't think you want to scare them and say we will lose your home because that may make them feel unsafe...but when you say badly in debt, how bad?

And how old are your kids?

The trick with kids is the find what ever you do 'normal' as they grow up. So if Christmas isn't a huge deal with lots of presents they don't really notice 'they are doing without'. The ideal way to do this is when they are young, but you can start at any age.

So give them less activities with others and give more of yourself. Scouts are cool, but time with Dad/Mom doing something else frugal can be even cooler. The trick isn't to spend less on them, but give them more of yourself. My 3 year old son just LOVES to help his dad do anything. Building, fixing, gardening, watering...he's right there 'helping'. We go for family walks each night and often stop at the school playground to play. I swear it's the best part of his day and it's free!

He doesn't care what I spend on him for Christmas, he just loves the fact we find him a cool toy. Hell some of best gift I've given my nieces and nephews were on sale for dirt cheap. They LOVED them because we really try to find something they will enjoy. It doesn't have to cost more than $20.

Set limits and make your kids stay within them. Say they get $200/year each (or what ever number you decide you can handle) for activities and if the can't afford to do both scouts and soccer they will pick the one they like more. They will understand at some point that they can't have everything all the time. You will teach them living below their means and give them a true leg up in life.

Tim (Father of two)

it sounds like you are making these things important, so they think it must be so.

I agree that spending time is what matters most, and as well know, that's free. When they were little, all we did was spend time together at the park or creek or at the beach (we at the time lived 2 miles from it) and we still strive for it as much as can, we volunteer our time inccesantly...but I will say that as they get older they start to look outward a little, maybe every year that they get older.

It would be hard (and I may be wrong) but that was more of the question it seems to me, and I can be corrected, to say no when you're ten year old comes home and says his best friend wants him to play soccer with him and can he? That said, if you have to say no, you have to say no. There's a limit. We'll frequently say no. It's too much money, too much time, too much driving...whatever it is and they have to live with it. They have been to their fair share of yardsales to find everything from sport equipment to toys to books...

We got rid of cable mostly because it's a waste and they were wonderful about it. No complaints...and Christmas has never been an overdone deal. Lots of homemade things and coupons for special time at the batting cage with dad (free), stuff like that...

The activities I mentioned don't cost a lot, 50 bucks say per kid (I don't mean to say 50 isn't a lot, but it's not say hundreds) and we frequently get a third child discount, and they have fundraise or do volunteer work to help offset costs...the difference is I wouldn't go into debt for it. And we don't. If there's truly a financial need, there are scholarship programs for all of them and we've donated to those so kids whose families need it can still play or participate.

But it would hurt to say no, if you had to...Sharon

I appreciate the replies. Let me first say, I know that we have to have limits and tell our children no sometimes. I'm not trying to get out of doing it- and I don't want anyone to get the impression that our kids are spoiled.

We have four kids- all girls, 15, 11, 8, and 5. Just clothing and feeding them is expensive, no matter where you shop. Even if you limit each child to one activity (we do), that still is expensive because for us it is the cost times four.

What I was really looking for here was some dialogue with people who've been where I am and had to sit down with their kids and say, "We're gonna be making some changes."

How did you do that? How did it go? Did you give them some choices?

I know this is a great opportunity to teach our kids about need versus want, etc- and I'm looking forward to that. But as another poster said- you don't want to scare your kids either.

We aren't in danger of losing our house or anything- and we're capable of digging ourselves out of this hole because we make decent money- but we won't get out of the hole unless we stop our current spending habits.

So, just wondering if anyone had experienced this aspect of having to explain these changes to their children without scaring them.

Kathy

We are in a similar situation, although with only 2 boys, 16 and 12. I think it's important to talk to the kids on their level, rather than one big conversation with all of them. The 5 year old is probably the easiest to make changes with, the older ones get used to a certain level of consumption and it's harder to cut back. Wants vs. needs is a big topic of conversation around here, and it takes a lot of repetition for it to sink in. I think that setting up an honest budget for the kids' expenses and sharing it with them is helpful. If they know that they have $200/year to spend on activities, they may make different choices than if they think the money is unlimited. They may also get into bargain hunting for things like clothes if they know the total dollar amount they have to spend.

Once they're all on board that there are going to be changes, then maybe a monthly family meeting to go over the kids' budget might be helpful. I personally don't think they need to know your total budget or how far in debt you are, just how it pertains to them and their spending. I'm also big on charts and visuals, so I might make a big poster with both monthly and yearly budgets for the kids activities and let them see where they are in the spending. That way when they ask for another activity you can refer back to the visual and let them figure out if what they want fits into the budget.

As hard as it is, you should teach them to be realistic about the cost of their activities. As an example from my life, signing up for soccer isn't just the cost of registration, it's the cleats and the uniform and the trophies and the pizza party at the end of the season (not to mention the time driving and going to practice and games ).

I don't have any great ideas for the Christmas thing. There is an older book, Unplug the Christmas Machine, that you can probably get at the library that may help. We've always had relatively modest holidays and it helps that we don't celebrate Christmas so the hoopla surrounding it isn't as strong. Often the kids have one thing they really, really want and if its out of our budget we'll try and figure out a group way of financing it (between us and grandparents we can usually make it happen). My kids have also (miraculously) learned to save up their allowances and gift money and have purchased for themselves a lot of things that we won't buy out of principle (the xbox360 for example).

Good luck and thanks for raising an important issue.

I tend to agree with Sweetart. Because of the big differences in their ages, you will most likely need to have seperate conversations with each.

But I would not hold the conversation until you have set a realistic budget. Ensure the budget includes a seperate budget for each child, allowance, clothing and activities. We skipped this step the first time we tried to fix our debt and it turned into a sinking black hole in our budget. Also, when I mean realistic... be realistic. Stopping everything will make them resentful, but cutting back will make it easier to accept. Maybe instead of killing the cable completely, par down to just the basic. Instead of the trip to the beach, figure out what type of family vacation you can take for half the cost. Our first year, we traded our annual Florida trip for a week of camping in our home state. We spent the week canoeing, caving, horseback riding, hiking, rock climbing and swimming all for less then half the trip to Florida. I know we may have prolonged our debt repayment, by not cutting out everything.. but we'll still be debt free in 3 more years (5 years total) and it made it easier to keep the whole family on board. Besides, I learned to cut coupons to allow us to keep a family vacation in the budget.

I know for us, our kids were much younger when we started (6 and 7) and are close enough in age that we treat them litterally the same. We highly value sporting activities, but knew we had to limit them to a degree, so we keep both our children to one activity in the spring and one in the fall. We set them up on allowances that they must use for any toys, and knick knacks that they want. We keep this one small at $10 because of their current ages (8 and 9), but I actually hand it to them at the beginning of each week. Then I also keep a misc fund for each month to pay for activities that come up (pool trips, scout outings, tournaments, fairs, etc). This one I hold on too, but let them know how much is left when they come asking to do something.

As far as talking with them, we kept it honest but simple. That we needed to cut back on spending, to ensure that we would be able to give them the things they needed growing up. That we had to realize we can't always get everything that we want, but that if we were smart and careful with our money we could enjoy life and have lots of fun! Then we just simple explained to them their part of the budget.

How about cell phones, seems every kid I see has one in their hand talking or text messaging ?

Personnally, we've taken a hard line against cell phones for our children. While still young (8 and 10), it amazes me how many of their friends currently have phones. I just have not found a parent of a teenage child who hasn't had horror stories about cell phone bills. Most that are successful, run with the prepaid in order to regulate the bills, but then I find it hilarious, because the kids generally only have service 2 weeks out of the month because they run out of mins so fast.

Cell phone billing is too complex for kids to easily grasp, nor do I want my child to get tied to their friends that easily. I see too many kids having all kinds of issues with them and plan to avoid them as long as possible with my children.

Thanks for all the great replies and ideas! I think there isn't a "one size fits all" answer. I believe there's a way to really figure out what's important to our family and what things we can do without- when you have kids (and even a spouse) it's going to take compromises. It may take families longer to get out of debt than it will take individuals, but it can be done.

Regarding cell phones- cell phones are cheaper (where we live) than a land line. We got rid of our land line and have a multi line cell service. Our 15 year old daughter has had a cell phone for two years. It costs $10 a month for her to share minutes with me. We just got a line for our 12 year old (because she is starting middle school- when kids, particularly daughters, are going to be away from parents for greater amounts of time, $10 a month is worth it-it's a safety issue). So, I have myself and two daughters on my plan- we share minutes and DO NOT HAVE TEXTING. We have roll over minutes with att and we never go over our limit- and we have the lowest plan they have. Not every child needs a cell phone (my 9 year old doesn't have one) but that is up to parents to decide.

I have to take a different stance than some. I see a lot of parents wanting to get\give their children whatever it is that they themselves did not get when they were kids--whether it be more toys, more money, more gifts, whatever. I'm not directing this towards kcahenson, but what can happen in these situations is that the kids can get to the point where they get spoiled and come to expect material stuff from the parents as the norm and then feel entitled to everything. Think about it... just about every generation wants to give their children whatever it is that they themselves didn't have when they were growing up. Well, add up a couple of generations afterward, and you can imagine it's gonna get skewed somehow. I'm not saying don't ever buy or do anything for your kids, just don't overdo it with the spending. Sometimes it's not a bad thing to do without.

By the way, I grew up poor but will be making a conscious effort to not spoil my kids when and if I have them. It doesn't mean I love them less than other parents. I will just educate the children early on about responsible financial spending. When times are tough, everyone has to cut back and do their part.

As for not having money to buy presents for Christmas, what is wrong with making your own presents? Sometimes those gifts are more special because someone has made it especially for you.

i grew up in a family of five kids. in the late 80's my dad's private practice (doctor) almost went under. to save it, he and the other partners all took a voluntary 50% pay cut.

my parents sat us down (I was about 9, my little sister 8, my other siblings all in their teens) and told us that things were going to have to change for a while. they calmly stressed that this didn't mean there wouldn't be food or that we'd have to move out of the house. they told us that we wouldn't be going on vacations for a bit or doing all of our usual activities. also that Christmas wasn't going to be all about big presents anymore and that we all were going to use this time to become stronger as a family. they also stressed that anything we really needed would be provided the same as always.

we the kids freaked out a little, but after a week or two we realized that things weren't really that different. we didn't mind christmas/birthdays with less. i think that year we actually all worked on presents for each other with dad in the shop.

i think if the kids are old enough, you just need to be honest but not dramatic with them. they'll understand. kids are pretty adaptable and as long as they realize that budget cutting doesn't mean they have to starve or might be displaced, they'll likely adjust fine in my experience.