Tell the truth: Did you emit an audible moan when you ripped open the third-quarter statement from your 401(k) plan? Have you and your spouse had a heated argument over how much was charged on your joint credit card last month? Do you work in the financial, auto or another industry making headlines about lay offs?

Don’t think you can hide the financial stress from your kids. They’re more perceptive than perhaps we’d like to admit. Regardless of the ages of your children, “It’s a safe assumption that if you and your spouse are stressing about money, they are picking it up,” says Eric Tyson, author of “Personal Finance for Dummies.”

While even a teenager probably doesn’t grasp the issues surrounding the current problems with the economy (most adults couldn’t tell you either), the messages they’re getting from the media, at school, and possibly at home are that things are bad, going to get worse, and could last a long time.

A friend of mine who works for a money management firm -- and whose job is quite secure -- was taken aback recently when his 16-year-old son came home from school one day and asked, “Dad, are we going to be OK? Will I still be able to go to college?”

According to Dr. E. Mark Cummings, professor of psychology at Notre Dame University, “The most important issue for a child is psychological and emotional security. Can they rely on their community and their family to be there for them? Disruption in the financial markets suggests they might be less safe.”

In other words, it’s not about whether the family ski vacation will have to be cancelled or how many presents they can expect this holiday. “What disturbs kids is not the dollars and cents of it, but that mom and dad are upset with each other,” says Cummings. “Children are very sensitive to conflict between dad and mom. If there’s fighting, anger, it will affect a child much more significantly than what’s going on in the outside world.”

If you’re facing financial problems, don’t dismiss a child’s concerns or avoid the issue. If a parent has been laid off, you can’t hide that from a child because they’re going to know something’s different if dad’s home all the time. “Don’t say ‘It’s not a problem,’” advises Cummings.

While you want to speak frankly with a child, remember to keep the details age-appropriate. Moreover, how you discuss this issue is just as important as what you tell her. The message you want to convey is that, although mom and dad are are going through a tough time right now, we’re going to get through it together and the family will be fine. 

“When parents have problems or challenges, kids are quite aware,” says Cummings, whose research focuses on the impact of marital conflict on children. Kids want “a sense that their parents are doing their best and are confident. Be honest in a reassuring way.”

That’s easier said than done, of course. Even before the current economic downturn, financial issues ranked among the most common sources of marital strife. 

“In general,” says Cummings, “Money causes conflicts which are more pervasive, problematic, recurrent, and unresolved. If mom and dad are upset with each other, it affects a child’s sense of security in the family. They’re more likely to be anxious, depressed, or have problems in school.”

Tyson, a father of three, maintains that, “In many ways, a long-term financial slowdown can be a blessing in disguise” because it gives parents an opportunity to teach basic financial lessons. “Educate your kids that the market goes up and down and that even though mom and dad are stressed about this now, you will be able to go to college.”

It’s also a chance to talk about the need to live on a budget and save for a rainy day. Tyson’s latest book, “Let’s Get Real About Money!,” includes a chapter on money issues for families. ”Kids are bombarded with messages about spending money,” he says. “If you don’t teach them about living within their means, they’re not going to get it anywhere else.”

If an 8-year old is clamoring for the latest Wii accessory, Tyson maintains it’s perfectly fine to say, “We have to be careful about how we spend our money.” If you’re dealing with a teenager, expect to go into more detail. However, that doesn’t mean spreading your pay stubs and bills on the kitchen table so you can explain your household bills to a 14-year old.

In fact, you might even consider enlisting a child’s help. Tyson suggests the following script: “Mom and dad are making some cutbacks in our spending and we need your help.” You might be surprised at the reaction you get. “Most kids will be amazingly supportive and want to pitch in and help out,” according to Tyson.

“The big challenge is for parents to handle the money issue between them constructively. Keep things in perspective. Don’t get too upset with each other,” says Cummings. The goal is to demonstrate that they “are finding a solution as best they can, while maintaining their love and affective with their partner. If kids see that, they’ll be fine.”