Guest Author - Terrie Andrade
I wish I'd said it first, and I don't even know who did: The only problems that money can solve are money problems. ~Mignon McLaughlin, The Second Neurotic's Notebook, 1966
The financial rules, laws and practices are constantly changing in society and the world’s economic situation ebbs and flows, but the importance of money in the home is always forefront. Most failed marriages, regardless of the socio-economic status of the couple, include money issues. Second or subsequent marriages are even more vulnerable to financial stress and pressure when child support and/or alimony are introduced into the budget. Stepfamilies are torn apart by the inability of parents to agree upon and establish an equitable division or sharing of resources. All too often these matters were either never discussed or were given less attention than the flowers and cake for the wedding.
Women today have better control of their earnings and clearer vision and financial aspirations than perhaps any other time in history. But even in these enlightened times the subject of blending them into a partnership frequently does not come up until after the honeymoon. The discussion may be awkward and certainly unromantic, but not talking about money is a big mistake. Attitudes about spending are important revelations in a relationship and will figure strongly in the success and security of your future together.
Whether you had the “money talk” early on or still need to do it, be assured that the matter is one of an ongoing nature. Money belonging to both of you should be managed by both of you and there’s no time like the present to begin.
Budgeting for a stepfamily household may take several months to achieve some accuracy in terms of needs and costs. It may be easier to initially appropriate a percentage of available income until the actual expense becomes more able to be anticipated. Nevertheless, a plan for shelter, food, clothing, transportation and security (health care, insurance and taxes) is a good place to start. Use the internet for obtaining basic budgeting samples or create your own format. Decisions about disposable income (what’s left over) may prove to be the most difficult because they are driven by individual values regarding saving, giving and entertainment. This is a good time to discuss your thoughts on allowances for routine tasks or special achievements of the children. Negotiations and compromises will be necessary. What are your ideas about an emergency fund? Do you cross bridges only when you come to them?
Obviously the personal income, assets and obligations that make up your new household will dictate the expenditures in your budget, the success in adhering to it will require a commitment to living within the family’s means and existing agreements. More battles are fought over how money is spent than the availability of it. The pitfalls of money management are as varied as the parties who experience them. There is no one-size-fits-all formula for bliss; but there are several practical points to consider in your pursuit:
•Be honest and forthcoming about your financial situation. Disclose debts, outstanding obligations, assets and resources you bring to the relationship.
Request a pre-nuptial agreement to protect property (savings, investments, real estate or inheritances) you do not wish to have included in your joint finances.
•Review divorce decrees and support agreements for amounts and duration. Become educated on how your combined earnings or modified custodial arrangements will affect these terms. This includes verbal agreements and informal promises you have made.
•Determine how you will file taxes, alter beneficiaries and plan for life changes such as disability or job loss or even the unanticipated death of a spouse or ex-spouse. Will you keep, change or modify your last name?
•Discuss goals such as homeownership, education funds, career advancement plans, retirement and inheritances (especially where grown children are involved). Consider your faith-based contributions and your position on giving gifts.
•Be certain to talk about everyday business such as whether you will have joint or separate bank accounts… or both. Who will be responsible for paying the monthly bills? Will you have personal funds for impulse purchases or traditions such as weekly manicures and lunch with the girls? How these matters were handled in the past will play a role in how you want them dealt with in the future.
•Do not hesitate to consult professionals if your situation is too complicated or sensitive for the two of you to resolve on your own. Whether it’s legal, financial or simply and impasse or inability to agree, seek help before it becomes a crisis.