One of my clients recently asked me whether she should discuss her short sale and plans for bankruptcy for with her children. She had been trying to keep the information from her children, who are 3, 5 and 9. Experience has taught me that children are way more perceptive than we give them credit and they usually know more than you may think. Poignantly, this client explained to me that her 9 year old had turned over a new leaf and seemed to be trying to be perfect.
If you are in a similar situation, I recommend you read an article concerning bankruptcy and children. http://www.chapter7-11.com/bankruptcy%20and%20children.html. As explained in the article, the worst things you can do are mislead and deceive your child. The experts almost all agree it is important to have a discussion with your children when financial problems arise. Of course, you may need to simplify the matters at hand as appropriate for the child’s age group.
After doing some additional research, my client decided to explain to her children that mom and dad were simplifying their lives and reducing their stress. She also reassured them that they are greatly loved, and things are going to get better. It is also important to let your children know that they have done nothing wrong and none of what is happening is their fault. Children tend to internalize and feel that they must have done something wrong. This would certainly explain why their 9 year old was trying to be perfect.
I call this handling a short sale with sensitivity and compassion.
Jon Terry
