Kids can learn lessons from difficult recession

ORLANDO, Fla. (MCT) — When Judith Edmond talks about personal finance at school, it's more than just another academic subject. The recession nearly left her homeless last year. The 18-year-old single mother says her family almost lost their house to foreclosure. To help save the property, she and her 10-month-old son moved in with her aunt so her mother could make extra money renting out Edmond's room.

"Everything costs so much now — clothes, food, Pampers and all that. The economy is bad," the high school senior said recently. "I work at Universal, but I can't get more hours to make any extra money. It's really tough."

Edmond is experiencing the nation's financial crisis up close and personal, but the slumping economy affects young people at all socioeconomic levels and in all age groups, experts say.

"It's obviously on their minds, from what they're saying and the questions they're asking," said Rosanna Jacobsen, an Orlando banker and president of the Florida JumpStart Coalition, a nonprofit group that conducts personal-finance courses in schools.

"What happens when you write a bad check? What does bankruptcy mean? Can you get in trouble and go to jail for that?" she said. "The questions often have a personal tone, like they're hearing these things or actually living them at home."

Even young children can sense when their parents are wrestling with financial problems. Just talk about money in a roomful of second-graders, Jacobsen said, and you'll discover how closely they observe and listen to their parents.

"One little girl, probably 7 or 8 years old, told me, 'When we don't have enough money, my momma will just charge it,' " Jacobsen said. " 'But when the bill comes in, I don't understand how it gets paid or who's going to pay it.' "

The recession, which this month becomes the longest on record since 1921, has been an especially rude awakening for some teens used to affluent lifestyles. Cash-strapped parents suddenly can't afford to bankroll their children's expensive clothes, cars, high-tech toys and other big-ticket items.

"I've seen some pretty bad reactions," said Laura Grashow, a Miami psychologist who specializes in children and families. "There's a lot of resentment, with the child blaming the parents, not the economy, for their financial problems.

"Sometimes, it's just adolescent rebellion. But sometimes, it's a problem in the family dynamics. Put together, it can be a strong cocktail that leads to a lot of acting out."