The elder Walsh, 74, said he heard about his son's death while out walking his two greyhounds.
"Someone called. I said, 'What has Barry been up to this time?' He told me he died ... everything went woof," he said.
He said Barry Jr left behind his wife and two daughters.
Bruce Fuller said he saw his mate "Bazza" for the last time the night before he died.
"I saw him at the pub. He'd have to be the fittest bloke going around here. He was a great guy," he said.
Fuller said Walsh was popular around Budgewoi and mentored the town's youngsters.
"He trained the younger generation ... to keep them off the streets. He'd point them in the right direction," he said.
Wayne Gregory, who has lived in Budgewoi all his life, said the 52-year-old loved to party.
Tuggerah Lakes Police Chief Inspector Colonel Lott said Walsh was among 10 to 20 people socialising on the beach when he was fatally injured.
Walsh's devastated wife Jo had to be taken to Wyong Hospital and sedated but returned home yesterday.
Insp Lott said Walsh had discussed with his friends on the evening that it was "time to light it to try it out", with the illegal fireworks.
"Obviously his family are going to remember this for the rest of their lives," he said.
"No one wants to lose a loved one at any time and on New Year's Day especially. Obviously it could have been avoided - if he had not taken it upon himself to use the firework, it was an illegal act in itself, he would be with us today."
Inspector Lott said the death was a timely reminder that people should not take unnecessary risks.
Another NSW Central Coast man, 19, remained in a stable condition last night in Royal North Shore Hospital after a firework blew up in his face, injuring his eyes.
The teenager was to undergo vision tests after he attempted to light the cracker at Blue Haven, about 8km west of Budgewoi, at 12.20am yesterday.
A man also died in Victoria when a cracker exploded in his hand.