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Blending Finances Is no Easy Mix

Blending families and blending finances can be difficult. Many blended families come together after having been single -parent households for some amount of time. And in that time, they may have encountered debt and credit issues, or witnessed their savings, investments and retirement funds reconfigured after a separation or divorce. Once together, families can be wary about how and what to combine, and often possessive about what they brought in. This reaction is normal, but not discussing the new financial structure can be detrimental to the relationship and hard on the family. New family structures provide an opportunity for new traditions: initiating a Family Annual Meeting (FAM), an open discussion about financial management and plans, can allow family members to be honest about expectations and identify mutual goals.

If there’s one thing all couples can agree on, it’s that they want to be debt free. But how to get there, and what to sacrifice in the process, isn’t always so agreeable. With blended families, the considerations are even more complicated. Couples desire to create a clean financial slate together, and put money towards things that benefit them directly as a new couple and family structure. But many people bring financial responsibilities from previous relationships and family dynamics into their new family unit, and over time that old baggage can lead to resentment. Child and spousal support payments or contributions to debt reduction or step-kid’s education funds can be trying for new partners.

Credit counseling and debt counseling or working with a Trustee or other professional can take some of the tension out of the discussions. For many, it’s difficult to not feel frustrated by what might seem like unequal contributions. For example, if one person comes to the relationship having saved for their children’s educations and the other hasn’t, it can feel unfair to put more money towards education funds rather than spending the money on items that feel personally rewarding. How to share in those contributions is a worthwhile discussion to have.

Beginning a life together by discussing  debt reduction and debt options might feel like a downer, but avoiding the topic of debt, expenses and savings only increases the financial and emotional tensions. Couples benefit from knowing what they spend, and sharing that information is the first step to managing personal and collective finances.  Regular FAM follow up meetings provide an opportunity to explore spending habits.  It’s also beneficial for the entire family. Open discussions about finances allows kids and teens to pick up on healthy financial processes and adopt them as their own.

By avoiding the tough topics, parents can solidify for their kids that the topic of money and debt is taboo and that it shouldn’t be discussed, enforcing that finances are something to be feared and avoided. When people are uncomfortable managing their money or talking about problems they’re unlikely to seek the help of a qualified professional if the need arises. Having a FAM opens the lines of communication on a regular basis and ensures that your partner and your children feel like they’re on the same team. This perspective can reduce blaming and shaming and increase cooperation.

And remember that it’s ok to tell your kids that you don’t have the money for something—sometimes when families blend together, kids think there’s automatically twice the spending money. They forget that there are usually twice the household and living expenses as well, and even if there is extra money, it shouldn’t automatically be earmarked for purchases. Paying down debt, saving for retirement and contributing to investments can be a family affair. Doing so can show children that being a saver is as much fun or more fun than being a spender.

How does your blended family talk about finances? Do you have family meetings? #FamilyFinances

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