(NC) Money matters can be tricky when adding a new partner, stepchildren or extended family members into a household. According to a recent TD survey, 66 per cent of Canadians living in a blended family say they face financial challenges, and 47 per cent find juggling these challenges stressful.
The top three financial challenges people face are determining who pays for ongoing household expenses, managing different views on the budget, and determining saving priorities.
Having an open discussion ahead of time will lay the groundwork for a well-functioning household. Here are some tips from TD on how today’s modern families can navigate common financial household hurdles.
Determine household priorities. Schedule time to sit down and discuss the future. What are your financial goals and priorities? Your blended family hopefully provides a larger support system, which can keep you accountable, help you to reach your goals and let you lean on them when needed. Consider speaking to a financial planner who will create an action plan to achieve both long and short-term objectives.
Compromise on managing the budget. It’s important to build a budget together to ensure everyone is on the same page about allocating money. Remember that each person comes into the home with different values about money — someone might be a spender who enjoys indulging, while another feels it’s important to save every penny. Developing a budget together will make surprises less likely.
Decide who pays for ongoing expenses. One person is usually better at the day-to-day management of costs. When there are new additions to the family, new expenses need to be sorted as well. These include which parent will cover the children’s sporting activities, whether or not child support is owed to previous spouses, or bigger ticket items like braces and post-secondary education. It’s okay to designate one person as the lead or bill payer, but others should be involved to know what’s going where. Since it’s rare each family member earns the same income, it’s best to determine ahead of time how much each person will contribute to both day-to-day and long-term expenses.
Find more information online at td.com.