5 Keys That Will Help You Merge Finances As A Blended Family

Typically, blended families are tough to balance and lead to a lot of friction, especially when it comes to money.  How do you merge finances in a blended family? There is no exact answer to how to do this, but with the help of these simple steps, you’ll find that merging finances is much simpler. 

About 40% of all new marriages in the U.S. include at least one person who was previously married, according to a Pew Research Center analysis. The complexities of blended families don’t fall short.

There are so many moving parts in blended families it can feel like you’re on a Ferris wheel. His kids, Her kids, and possibly our kids in the future.

The awkward conversation around having the “money talk” isn’t new but it can tend to be avoided. Disrobing financially can make you want to hide as you navigate through vulnerable areas.

It is uncomfortable touching on certain issues when it comes to finances and what each person brings into the marriage.

Start Fresh With A New Money Perspective

Our backgrounds concerning the relationship we have had with money in our past play a part consciously and subconsciously.

They shape how we currently respond to different financial scenarios.

There are things to consider at the beginning to keep you from having misunderstandings as you move into your future as a family.

Strife can enter into a relationship when potential disagreements start happening because things were not discussed around money.

Strife can enter into a relationship when potential disagreements start happening because things were not discussed around money. Share on X

Money issues contribute to a large percentage of divorces. Add to that higher divorce rates among those previously married and you have combined statistics that show you what you should pay attention to.

Starting off on the right foot will help you establish a foundation of trust with your spouse. Having full disclosure about debts owed puts everything out on the table.

Is there credit card debt? Is there student loan debt still owed? Are there any tax obligations that would catch your spouse by surprise? Is there child support or alimony that needs to be paid?

If there are secrets about money it could breed mistrust within the relationship. It makes them question If there is a secret around finances I wonder if there are any other secrets. Secrets plant seeds of doubt and breed insecurity.

When mistrust is there, the openness and vulnerability required for a couple to grow strong and closer to each other begin to close.

It might be little by little, but insecurity will separate them from being on the same page together because there wasn’t transparency.

Starting off on the right foot will help you establish a foundation of trust with your spouse. Having full disclosure about debts owed puts everything out on the table. Share on X

Your Money Personality

Think about your money personality. We all have one. Are you by nature a spendthrift with a mentality that screams, Live it up because it’s not going with us!

Or… Are you conservative and like the security of saving? The nest egg of money in case of an emergency gives you peace and creates a cushion of security for you.

Your money personality matters and affects your partner whether you’re a spendthrift or a saver.

Have you always had big Christmases and indulged your kids during Holiday events? Big Birthday Parties?

Do you go big or go home on special occasions? Your new spouse needs to know this and not be surprised by it when it happens.

Maybe you paid your kids for chores, but your new spouse didn’t, they see it as everyone lives here so we all contribute. No one gets paid for cleaning the house they live in. This might not seem like it could ruffle feathers until one set of kids get lavish gifts and hefty allowances, but it isn’t the case with your spouse’s kids.

The other set of kids doesn’t get paid for chores and gets small, reasonable gifts for birthdays and Holidays.

Your spouse’s idea of gifts could be more with a budget in mind, which is considerably lower than your extravagant gift-giving. This can create jealousy among the kids that live in the same house. Comparing their gifts with their step-siblings creates animosity and jealousy

What drives our financial behavior often stems from issues that are deep-rooted. Fear and trust.

There can be residue from the past where money was used as a tool to have power and control over you.

Maybe you were the one controlled by someone being in control of the money or you could have been the one doing the controlling.

It’s wise to do some internal searching and investigating about your behavior so it doesn’t affect your current relationship.

If you don’t uncover the root of it, concerns about this happening again can cause fear and insecurity around money in your relationship.

What drives our financial behavior often stems from issues that are deep-rooted. Fear and trust. Talking with your spouse about your concerns around finances will help uncover some potential reactions or struggles you didn't know… Share on X

Talking with your spouse about your concerns around finances will help uncover some potential reactions or struggles you didn’t know were there.

Addressing them with each other or going to counseling will help you work to get to the root so it doesn’t become a point of contention later.

Having A Financial Vision

Having a financial vision will help you curtail any potential issues because you’ve made a decision to set goals and put a plan in place.

Minimizing things that are concerns now end up getting maximized and causing problems later.

It’s hard to hit awkward things head on but if you do you will preserve the unity with your spouse and keep walking in the same direction, united and not divided.

Plans provide security because it’s a financial roadmap that leads you where you want to be as a couple and family.

With a plan, you are able to sort through the seemingly small things to the complex things that will require your attention.

The dedication to put things in order by getting a plan together is not only wise but shows your spouse you’re willing to do what it takes to make your relationship strong.

5 Things You Need To Know About Managing Money In A Blended Family

Here are 5 things to consider in how to manage finances in a blended family.

1) Be Open And Transparent About Money

Do We Openly Discuss Finances and Disrobe Financially With No Secrets About Money?

Budget isn’t a bad word until one of you decides it is. Then things get sketchy because you aren’t walking together but pulling against each other.

Talking about money is being kind and respectful to each other. It keeps you on the same page, validating your partner.

Not being on the same page financially is like getting in your car and driving in the opposite direction hoping you’ll end up at the same destination. It doesn’t happen. Hope isn’t a plan.

Questions like, Who is going to pay the bills? Do we do it together or is one person gonna take on the task every month?

If you talk openly and frequently about things that revolve around your financial situations you will ultimately experience a more peaceful atmosphere in your blended family.

Clear communication will help you navigate the pitfalls many blended families face over financial decisions that need to be made. To avoid having discussions about it will only contribute to confusion and misunderstandings.

Discussions about money decisions being made together will help you stay on the same page.

No secrets around money. Secrets backfire. Mistrust is bread and insecurity lingers when secrets are discovered. Honesty requires transparency that helps forge stronger bonds and trust in the area of finances.

Disrobing financially is difficult if you have accumulated debt you regret and past spending habits that you now have remorse over.

Is there is an open-ended conversation and a plan to tackle the debt that both you and your spouse are on the same page about? If so, it will allow you both to experience peace as you work towards a common goal.

Hiding it from your spouse will only cause division. Celebrate your progress and wins together.

2) Consider A Togetherness Agreement

Ron Deal, a marriage and family therapist and co-author of “The Smart Stepfamily Guide to Financial Planning,” recommends to couples He counsels to consider doing a Togetherness agreement.

Here’s how Ron Deal defines it:

A Togetherness Agreement (TA) helps your plan to succeed. A TA is a detailed financial vision of your life together.

Essentially, it involves putting everything on the financial table — your assets, debts, dreams, and obligations — and deciding how you can meet your needs and facilitate the permanency of your marriage. 

Ron Deal

Finding unity by coming together and agreeing upon different areas involved in combined finances is much more palatable than bringing up a prenuptial agreement.

We genuinely are better together as a family when we are all on the same page. It removes the obscurity around finances. We aren’t guessing because everything is wide open with a plan in place.

Earlier, I mentioned the many moving parts to a blended family resembling a Ferris wheel.

There isn’t a more complicated situation than the family who doesn’t open all the doors to see what’s inside so it can be addressed with a plan.

When no plan is the plan, multiple family members get hurt by something that could have been avoided. It’s worth the effort to do something proactive for your family so financial issues aren’t a threat in the future.

3) What about Wills and Trusts?

Did you come into the marriage with a trust or significant 401k for retirement? Did you have accrued assets before you married your spouse?

Seeking legal counsel you both agree upon will keep you from experiencing a headache with adult children down the road.

It will help avoid potential rivalry between bonus children and biological children.

Whatever it is, deciding as a couple is the key. Being in unity about the decision cannot be overstated.

If there are assets that are willed to your biological children and some that are willed to your spouse’s biological children make it clear legally so confusion is removed.

Documents bring clarity and clarity is kindness when things are muddy and gray.

Neglect doing this is detrimental. Putting it in place will save everyone a future headache. Probate courts have no vested interest and don’t personalize it. It’s business to them. But personal for you. So put the right legal documents in force.

They are the result of things that were left to themselves, now, the only one dictating your assets is the court system.

4) Do You Have A Financial Vision

There is a biblical statement: Without a vision people perish. They cast off restraint. When we have a financial vision it motivates us to pay attention to what needs our attention or discipline. (Proverbs 29:18)

It’s tempting to think, “Things just have a way of working themselves out.”

They don’t always. In fact, without a clear vision and plan for a blended family, there is the potential of everyone getting hurt because no plan was considered for the future. If one of you dies then what? Where do the assets go? What happens when both of you die?

Do you have a shared financial vision for your future? Are you both working towards that goal? Do you track what’s coming in and what’s going out?

What would happen if someone got sick long-term? Getting appropriate insurance and setting emergency money back will give you peace of mind. It’s good to hope for the best but also plan for the worst.

Things happen. Unforeseen things at times, so living prepared will contribute more strongly to your foundation.

5) A Monthly Financial Meeting To Stay On The Same Page

Spreadsheets aren’t fun but they are your friend. You need to nerd out once a month. This will keep you and your new spouse accountable to your vision and plan for your family.

You might have a joint account you pay bills out of together and two separate accounts. Whatever works best for your family and situation is the goal. Unity and peace is the goal not controlling each other.

Splitting hairs over the method is not necessary, but measuring your results together is the win. Being able to see yourselves making progress.

Are you staying on the same page? Are you experiencing animosity over finances as a couple? Are you on the same page monthly about what is being spent on the children?

Having a monthly meeting removes question marks about where you are financially.

Having a monthly meeting removes question marks about where you are financially. Share on X

Having a monthly meeting keeps you connected and discussing where you need to adjust and what areas you can grow in.

Monthly meetings keep the vision you have as a family in front of you.

The most gracious thing you do for your family is deciding how to merge finances in a blended family.

For detailed instructions (and a worksheet) on how to manage your money better, read this.

Final Thoughts On How To Merge Finances In A Blended Family

In this article, we talked about five keys on how to merge finances in a blended family.  These tips will help you manage your money in a way that creates unity and avoids tension.

Blended families are hard enough as it is, and now you have to find a way to merge incomes when there may be two or more adults in the home. This can be tricky, but putting together a plan will help you avoid pitfalls that can damage your relationship. 

Even if you are happy and excited about your new life as a blended family, it is still important to talk openly about money because it could cause friction down the road.

Quick Recap

• Start Fresh With A New Money Perspective
• Your Money Personality
• Having A Financial Vision
• 5 Things You Need To Know About Managing Money In A Blended Family
  • 1) Be Open And Transparent About Money
  • 2) Consider A Togetherness Agreement
  • 3) What about Wills and Trusts?
  • 4) Do You Have A Financial Vision
  • 5) A Monthly Financial Meeting To Stay On The Same Page

Putting these things into consideration will help you avoid potential pitfalls and misunderstandings by dissecting your finances together and deciding the direction you want to go as a family. 

What’s Next?

Where To Find Help