As a bankruptcy Memphis TN attorney I’m often asked, “Will bankruptcy affect my kids?” In fact, many folks who are struggling with debt hesitate to file for bankruptcy because they’re afraid of what their family will think. Instead of fixing their financial problems, they resort to credit cards or loans when they fall behind, just so they can keep up appearances for their sons or daughters. However, as a father myself, I know children are very sensitive to the emotional and financial difficulties their parents face. If you are pretending your debt is not a problem in front of your kids, you may actually be increasing their anxiety.
So, will filing for bankruptcy affect your kids? The answer is yes, but not in the negative way you may be thinking. In reality, it could be the best thing to ever happen to your whole family.
Of course, discussing finances with children can be difficult. Here are some tips on how to talk about bankruptcy with your children, and some insight into why this could be the best choice for you and your family’s future.
Tips from a bankruptcy Memphis TN attorney on discussing bankruptcy with your kids:
Keep it simple and caring
Many financial experts advise parents to keep things simple when discussing finances with their children. You can tell your child that you are filing for bankruptcy without going into every intimate detail. Also, tailor your message to the age of your child. A teenager is capable of understanding more complexities and implications, whereas with young children, you’ll want to go by the saying “less is more.” Above all, be reassuring. Let them know your family has a plan and is working toward the solution together.
Be honest
When times are tough, children can sense something is wrong. So rather than letting them become worried by imagining the worst possible scenarios, be honest and address the issue head-on. If you are the victim of a job loss or unexpected medical debt, tell your children. Talk to them about your credit card debt, too. Showing them that you are taking control of the situation and not running away is a fantastic learning opportunity they can carry with them into adulthood.
Take the opportunity to teach valuable life lessons
Many parents are scared their children will see their bankruptcy as a failure or mistake. In actuality, there’s no better way to be an example. Our kids learn from watching how we deal with challenges. Something to keep in mind is that bankruptcy looks differently depending on how you react to it. If you meet it with shame, its impact on your life looks a lot darker. But if you view bankruptcy as a positive act (as facing your debt head-on and taking control of the situation), then you turn a challenge into an empowering learning opportunity. It shows your children that, like you, they have the power and agency to deal with setbacks.
Talk about forgiveness
Whether you’re religious or not, forgiveness is always a good value to discuss with your family. In fact, bankruptcy has its origins in this value. It was created around the belief that a person’s debts should be forgiven every seven years. One reason for this was to prevent the massive accumulation of wealth and power we see today. Like many religious figures, the U.S. court system also believes that debtors should have the opportunity to have their debts forgiven when necessary.
Bankruptcy can offer the life you’ve always wanted to give your kids
Whether it’s a family home or paying for your children’s education, bankruptcy can give you the clean slate you need to make those life goals a reality. When discussing your bankruptcy with loved ones, remember to talk about how your decision can positively impact your future.