Expectations of your child
It's important that you have the same expectations of your anxious child that you would of another child (to go to birthday parties, make decisions, talk to adults). However, understand that the pace will need to be slower and there is a process involved in meeting this end goal. You can help your child break down big tasks into smaller steps that your child can accomplish (first go to the party with your child and agree to stay as long as your child is interacting with others, next time stay for the first half hour). You can help role-play or act out possible ways your child could handle a difficult situation. Saying it out loud makes kids more confident and more likely to try the strategy when your child is alone.
Build your child's personal strength
It's important to praise your child for facing challenges, trying something new or brave behavior. Some children like big loud exuberant praises, others like a quiet pat on the back. There is a lot you can do to help build your child's competence. Search to find avenues where your child can show he is good at something (music, art, sports). Also be sure your child has jobs around the house that show your child is contributing to the family.
Letting your child learn to do things on his/her own
While tempting, it is best not to take over or do it for your child. While this might help your child feel better right now, the message your child is getting is that you don't believe your child can do it. Then your child will start to think the same way about him or herself. Try not to get caught continually reassuring your child that everything will be okay. Teach your child to answer his/her own questions and provide the reassurance him/herself. You can model how you think through and respond to your child's questions.
Helping your child handle his own feelings
It is okay to let your child experience some anxiety. Your child needs to know that anxiety is not dangerous but something your child can cope with. You can let your child know all feelings are okay and it is all right to say what you feel. Anxious children sometimes have a hard time expressing strong emotions like anger or sadness because they are afraid people will be angry with them. It's okay to take time for yourself even if your child wants to be with you at all times. You are modeling for your child that everyone needs some time to themselves.
Passing on your fears
Try to keep your fears to yourself and as best you can present a positive or at least neutral description of a situation. Let them know that it is safe to explore. It is not helpful to laugh or minimize your child's fear. But humor does help one deal with the world, so show your child how to laugh at life's absurdities and mistakes.
Don't confuse anxiety with other types of inappropriate behavior. It is very important to set both expectations and have limits and consequences for inappropriate behavior. Parents who have reasonable expectations of their children and clear and consistent limits and consequences for behavior along with love and acceptance have the most competent, self confident and happy children.