How to Handle Money Effectively as a Blended Family
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Key Takeaways to Help You Handle Money Effectively as a Blended Family
1 - Know What Makes You Feel Financially Secure
I love Maslow’s hierarchy of needs, and as Stacy says, feeling secure is a necessity. Especially if you’re coming from a prior relationship where trust was broken or you’re solid in your system of managing money and big decisions as an individual, instead of a couple.
Identify what you need to feel secure. That could mean a certain size emergency fund, combining or not combining finances with your partner, or having some money that’s purely your own. Decide what you need so that you can communicate that to your partner and feel confident.
For many blended families, this includes creating a prenuptial or postnuptial agreement and setting up a complete estate plan. These agreements might not feel romantic, but they really are love letters to your family. With pre- or postnups, you’re committing to how you’ll treat each other, even if the relationship doesn’t go the way you hope.
With an estate plan, it’s making sure your spouse and your kids are taken care of and protected, no matter what happens.
When people feel unsafe, they make bad decisions. They’re more likely to pick fights, hide things, or build resentment. Knowing what makes you feel secure will put you in a good position to build a positive money relationship as a family.
2 - Make Sure You're Taking Care of Your Financial Future
Stacy mentioned today that many adults in blended families feel some kind of guilt and how often, that comes through as overspending on our kids. However, you have to remember to prioritize your own financial future.
Saving for retirement can be harder for blended families—especially if you’ve gone through a prior divorce or are starting to save and plan later in life. Set a target for how much you have to save and talk to your partner about the type of retirement you both want. Then create a plan for getting there.
This will not only put you in a better position in the future, but will also inform decisions about how much you and your spouse can help your kids with college expenses, whether you can afford private school, and more. What you choose to spend on your kids, you’ll be able to spend confidently knowing you aren’t creating more financial stress and anxiety for yourself in the future.
3 - Remember That Open Communication About Money is Especially Important for Blended Families
With a blended family, you’re taking two families and creating one. Old relationships, money stories and beliefs, and more moving pieces can make it hard to open up. But if you want your family to thrive, you have to actually be honest with your partner and truly blend your families.
Talk about what assets and income you and your partner have. What responsibilities are there? How will child support payments change? What are your goals, where will you live, and how will you budget together?
But you also have to talk about the softer things. What traditions are you both used to? How do you handle birthdays and holidays? What support do you want to provide for your kids as they reach adulthood?
Continue to keep the lines of communication open. There will be challenges that come up—exes that make things more difficult or different views on whether teenagers should work. But if you trust each other and commit to working together, you can find the right path for your family.
Links & Resources Mentioned
Connect with Stacy
Stacy Francis is the President and CEO of Francis Financial, Inc., a fee-only boutique Wealth Management, Financial Planning and Divorce Financial Planning firm dedicated to providing ongoing comprehensive advice for successful individuals, couples and women in transition such as divorce or widowhood. Stacy has over 20 years of experience in the financial industry. She is the host of Financially Ever After and the author of the white paper, Unveiling the Unspoken Truth: The Financial Challenges Women Face During and After Divorce.
Stacy is also the founder of Savvy Ladies™, a nonprofit organization dedicated to educating and empowering women to take control of their finances. Savvy Ladies has helped over 15,000 women through free one-on-one financial counseling, workshops and retreats.
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