My husband is both a full-time high school biology teacher and a part-time college biology professor. During the summer, we're out almost $1000 a month while he is on break from the local college. Given that neither of us are fabulous budgeters, summertime expenditures are practically nil and that means explaining some harsh realities to our son.
At the end of the school year, I sat him down and explained to him that we don't have much money in the summertime. He knows that Dada doesn't have to work two jobs for a little bit, but he also knows Dada is still going to work every day (and for far too long, considering his 100 mile round-trip daily commute), so things were still a bit foggy for him. I explained that the extra things that we usually get to do and buy won't be happening for a couple months. Instead of going to the "dinosaur museum," we'll go see the free puppet show at the library. Instead of hitting the "craft store" once a week, we'll hit the library for their free craft day. We won't be able to buy movies on iTunes, we won't have pizza on Friday night, we won't be able to go here or there. We'll still have fun, it just won't be all the same fun and maybe not as much of the bigger excursions or buys.
His reaction? "OK." That was it. I was honest with him. I was real with him. He was OK with that.
He forgets sometimes. He's four. I remind him and he goes right back to being OK with it. "Oh, ya, I forgot," as he scurries off to find another way to entertain himself.
The point? Just be forthright with kids. They can handle it. They get it. They aren't as selfish as we make them out to be. In fact, they're pretty cool.
I'd write more, but my son has just started building a "tall, tall tower" out of the couch cushions (for free) and, according to him, he needs help stabilizing it. Free fun, learning, and bonding, comin' up!