Thrifty holidays? Involve the kids

If you're facing a tight Christmas instead of a white Christmas, talk to the kids about it.
Children know when their families are stressing about money, but they may not understand where you really stand. They may be imagining a situation that is far bleaker than it actually is. And they may not be hearing the messages you think you are delivering.
A recent study from Northwestern Mutual Foundation found that almost half of all parents felt the recession had made their families work together more closely on financial matters.Only about a quarter of kids agreed, and another quarter actually thought that financial pressures were making their families drift apart.
"Mom and Dad think they're connecting with their kids about money, yet their children say little has changed," said Northwestern Mutual Senior Vice President Meridee Maynard. She tells parents to take advantage of holiday season opportunities to interact with their kids about money, and to be aware of the holiday-spending examples they set.
"The kids are observing all of this, so I do feel like, right now, more than ever, you do want to make sure that you transmit to your kids that things are under control," she says. Here's how to be honest yet reassuring in the face of "Are we poor?" questions, and how to model some smart money behavior during the shopping season.
-- Talk early and often. If a parent loses a job -- or is worried about it -- it's good to call a family meeting and lay out a tight-budget policy. At that meeting, make it clear the family is going to cut back to be smart about money -- and not because they are in big trouble. Use the meeting to reassure kids that you have savings, skills and back-up plans that will protect your family from hardship.
-- Focus on fundamentals. Don't say (or think) that you are spending less just to save money. Set a goal to simplify the holidays so you can have more time and pleasure in them.
-- Don't say everything in front of the kids. If you're arguing with your spouse about unpaid bills or fretting about next month's mortgage bill, do it behind closed doors.
-- Ask for help in setting priorities. Solicit ideas from your kids about how to save money on the holidays. That will train them to understand that money is all about choices. Ask them to prioritize items on their gift lists. Offer choices like, "Should we go to a movie today, or buy a game and play it at home?"
-- Take them shopping with you. Model good shopping behavior. Use coupons, shop with a list, buy items on sale, and make tradeoffs between one item and another.
-- Help them handle cash gifts. If Grandma lays a $20 or a $50 on them, help them decide to save some -- Maynard suggests at least 10 percent -- toward a big future goal.
-- Have a wonderful season and as much free fun as you can squeeze in. (For extra ideas, download the "Simplify the Holidays" guide from the Center for a New American Dream, http://www.newdream.org.) If you tell your kids that "money isn't the most important thing" or "gifts aren't the reason for the season," they won't believe you unless they observe you enjoying those finer free things in life.
So take joy in the walks, the games, the baking sessions and the visits. Happy holidays!
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