Financial debt can be a source of stress in the family, but a study of Pediatrics found certain types of debt was positively linked with children’s social and emotional well-being.
While children whose parents carried unsecured debt such as credit card balances were more likely to have behavioral problems, according to the study, other types of debt such as home mortgages and student loans were tied to fewer child behavior difficulties.
Authors of the study, “Parental Debt and Children’s Socioemotional Wellbeing”, said debt that allows for investment in parents’ education and homes may provide access to more stable neighborhoods and better schools.
Unsecured debt, which tends to have high interest rates and be used for short-term consumption rather than long-term investment, may indicate economic distress. The authors said this, in turn, can create anxiety that affects parenting interaction and child development.