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Financial Planning For Blended Families

Dec 5, 2018 | Children & Education, Everyday Finances, Women

A recent survey found that Americans overwhelmingly consider family as the biggest source of meaning and fulfilment in their lives [1]. Today’s modern family is often a blended one, typically as a result of divorce, death, or relationships later in life. It’s wonderful to see families unite. However, when two families merge, so too must their value systems, traditions, parenting approaches, finances, and more. SageVest Wealth Management considers financial planning for blended families.


Blended Family Finances As Partners And Parents

Your kids observe your behavior and learn from your interactions with life, parenting, money, and more. It’s important to be on the same page with your partner to avoid relationship, parenting, and financial conflicts. Blended families must also consider how co-parents can influence your kids’ and step-kids’ lives and attitudes towards money.

Understand Your Own Money Personality And Parenting Style

Evaluate your own money personality and parenting style by considering what influences your behaviors. Look back at your own childhood experiences. Do you approach money and parenting as your parents did? Or, are you different because of their styles? Consider your life outlook, value system, and personality traits too. Understanding how you behave helps you interpret how others relate to you.

Understand Your Partner’s Money Personality And Parenting Style

Don’t just assume that you understand your partner. Take the time to have meaningful discussions about how he or she grew up with money, how parenting decisions were formulated, and how your partner feels about experiences in childhood or prior relationships. All of these variables impact current decisions that you now make together as partners and as parents of a blended family.

Accommodate Differing Co-Parenting Styles

If an ex-spouse’s parenting and financial decisions differ from your own style and beliefs, it’s even more important to explain your core values to your kids and to solidify those values in your actions. Focus on the positives, not the negatives, and find ways to be a good role model.

Find Collective Family Values

Work together with your partner to determine:

  • where your family values align.
  • where they differ.
  • how prior family dynamics might influence your child’s outlook.

Focus parenting decisions on areas where your values overlap, and find amicable solutions where they diverge.

Financial Planning For You, Your Kids, And Your Step-Kids

Deciding how to allocate financial resources for your child’s benefit and your own long-term goals such as retirement is a common parental struggle, regardless of family structure. These decisions begin when kids are younger, generally climax when it’s time for college, and sometimes persist longer if kids need assistance as adults. In blended families, your financial decisions extend to your step-kids too. Balancing your own needs with those of your kids and step-kids can be challenging.

Identify Your Kids’ And Step-kids’ Needs

It’s expensive to raise children. Many costs are essential, such as food, childcare, and school supplies, but there’s an endless list of optional expenses too.

The Funding Decision

Every parent needs to decide what’s in the best interest of their children, by:
– balancing needs versus wants.
– contemplating the values you’re imparting.
– considering the financial education you’re instilling.
– remembering longer-term needs and goals e.g., college.

The Equality Decision

When you’re part of a blended family, your goals and resources might differ from those of your partner. Unless you’ve adopted a fully unified approach to finances and parenting, you’ll likely need to balance your needs or desires to provide for your own kids with providing for your step-kids too. This requires collaborative discussions to address:
– how decisions affect joint household finances.
– how parenting differences will be explained to children.

Relative To Your Needs

Every financial decision you make on behalf of your children must be relative to your own finances. All parents want to provide for their kids, but your financial security is equally important. Remember that your retirement’s closer than your child’s retirement, and that your kids can get loans for college, cars, and houses, but that you can’t get a loan for retirement.

Relative To Your Resources

Similarly, your financial goals for your kids and step-kids must be realistic, relative to your resources. Financial planning can help evaluate your financial standing and understand the impact of your money and parenting decisions, e.g., how much longer you’ll need to work in order to send your kids to an Ivy League school. Financial planning helps to frame decisions, providing the information you need to make collaborative and money-wise decisions in support of yourself, your partner, and your blended family.

Relative To You And Your Partner

Many individuals in blended families elect to maintain separate finances. This allows you retain financial independence and decision-making. However, you’ll also need to plan as a couple too, ensuring that you’re on track to sustain yourself and your relationship once your kids are grown.

SageVest Wealth Management works with all types of family structures, developing customized financial strategies that support your individual, parental, and family objectives. We also counsel clients on the complexities of estate planning for blended families. Please contact us for more information on how we can support your family’s financial needs and wealth goals.



Prepared by SageVest Wealth Management. Copyright .
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