In the context of the Swedish welfare state, the issue of child poverty has over the past decade become increasingly prominent within the political agenda. Most research on child poverty has been based on statistics and research on children’s everyday life and their experiences in situations of economic hardship has been in demand in international as well as Swedish research. The aim of this thesis is to explore and analyze children’s experiences of living within economic hardship as part of their identity work. In addition, it highlights how their agency can be understood as a way of dealing with their situation, as well as how child poverty – and the child position in a welfare state setting -  is understood and conceptualized by the society they live in.  The analysis was based on an interview study involving seventeen children between the ages of 6–18 in families living on or below the limit for receiving welfare benefits. The purpose of the interviews was to explore how these children experience economic hardship at home and among same-aged children, focusing their own strategies and agency. The thesis uses the field of childhood sociology as a theoretical starting point, and the empirical findings are analyzed with an interactionist approach which highlights the meaning of interaction and agency in relation to identity work. The strategies deployed by the children in this study was interpreted in the context of the limited space for agency that the child position entails as well as how their positioning as children, by themselves and others, creates a new understanding of the way poverty is managed by them. This thesis seeks to problematize the issue of child poverty in Sweden by stressing its complexities.  The thesis also emphasizes that it would be a simplification to label these children as merely stigmatized since the status of poverty as a stigma for children can be questioned.