Wi-Fi and networks or someone connecting unauthorized to my hotspots?

Your Mac and other devices are signed in with same Apple ID and password on the same network using personal hotspot , in which password is not required Share your internet connection from iPhone - Apple Support

Note: You can connect the devices without entering a password when you’re signed in with the same Apple ID on each device, and you’ve turned on Bluetooth and Wi-Fi on both devices.

And internet sharing is done with your Childs friends Share the Internet connection on Mac with other network users - Apple Support

1. If you’re sure you want to turn on internet sharing, click Start. Otherwise, click Cancel.

WARNING: If your Internet connection and your local network use the same port (Ethernet, for example), investigate possible side effects before you turn on Internet sharing. In some cases, sharing your Internet connection disrupts the network. If you use a cable modem, for example, you might unintentionally affect the network settings of other ISP customers, and your ISP might terminate your service.

See some articles Recommended settings for Wi-Fi routers and access points - Apple Support

Connect to Wi-Fi on your iPhone, iPad, or iPod touch - Apple Support

Use a private network address on iPhone - Apple Support

Secure access to wireless networks - Apple Support

Note : change your wireless network password and don't share to anybody Change your Wi-Fi network’s name, password and security settings in AirPort Utility on Mac - Apple Support

Read If you need help with your Wi‑Fi password - Apple Support

Use stealth mode from Mac Use stealth mode to keep your Mac more secure - Apple Support ( your network name will not be visible to other surrounding devices that are in range of your network , however you can see their network names ) .

Why you contacted Apple I don’t know. This has nothing to do with Apple or it’s products. If your children have the password to your Wifi and they share it with their friends that is definitely a parental control issue. Give your children an ultimatum. If they give out the password you will cut them off from the internet. Depending on the WiFi router you have you can restrict the devices that can connect to it even if they know the password. You can also restrict the time of day and length of time each device is allowed access. Read the manual for your WiFi router carefully. If you are not the techie type then find and hire someone who can set it up for you.

Not to scare you but a stranger accessing your WiFi unauthorized can get you into serious legal trouble. So someone parks in front of your house, logs into your WiFi and starts downloading/uploading illegal content. That can be traced to your internet account and the police show up at your doorstep.

Make sure the security on your WiFi router is WPA2 or WPA 3 (only newer routers will have WPA 3). Change your WiFi router password and give it to no one. Let your children twist in the wind if they can’t be trusted. This will prevent any unauthorized access to your WiFi network. This action alone will resolve almost all of your issues.

And by the way, your WiFi router itself has a password for admin access. Change it too so your children can’t get in and change everything back.