"Although both of Vonnegut's parents were fluent German speakers, the ill feeling toward that country during and after World War I caused the Vonneguts to abandon that culture to show their American patriotism. Thus, they did not teach their youngest son German or introduce him to German literature and tradition, leaving him feeling "ignorant and rootless". Vonnegut later credited Ida Young, his family's African-American cook and housekeeper for the first 10 years of his life, for raising him and giving him values. "[She] gave me decent moral instruction and was exceedingly nice to me. So she was as great an influence on me as anybody." Vonnegut described Young as "humane and wise", adding that "the compassionate, forgiving aspects of [his] beliefs" came from her.

The financial security and social prosperity that the Vonneguts once enjoyed were destroyed in a matter of years. The Liebers's brewery was closed in 1921 after the advent of Prohibition in the United States. When the Great Depression hit, few people could afford to build, causing clients at Kurt Sr.'s architectural firm to become scarce. Vonnegut's brother and sister had finished their primary and secondary educations in private schools, but Vonnegut was placed in a public school, called Public School No. 43, now known as the James Whitcomb Riley School. He was not bothered by this, but both his parents were affected deeply by their economic misfortune. His father withdrew from normal life and became what Vonnegut called a "dreamy artist". His mother became depressed, withdrawn, bitter, and abusive. She labored to regain the family's wealth and status, and Vonnegut said she expressed hatred "as corrosive as hydrochloric acid" for her husband. Edith Vonnegut forayed into writing and tried to sell short stories to magazines like Collier's and The Saturday Evening Post with no success."