Financial Advice for Blended Families

When families merge, you’re bringing more than just yourself and your kids into a new marriage; you’re bringing your financial habits, too. Why not start fresh with financial advice for blended families to ensure a smooth transition. Remarrying with kids can be a veritable minefield when it comes to finances. And everyone has heard horror stories about ugly money disputes after a parent or spouse dies. But you can protect your family if you enter your new marriage with a workable game plan for finances. Obnoxiously unromantic? Maybe. But too many people go into new marriages with blinders on and regret it terribly. Here are some of our finance tips for blended families.

financial advice for blended families

Make your own rules

The first thing to remember about managing your finances as a blended family is that there is no right or wrong way of doing things. Some married couples decide to combine everything and others keep it all separate. We will discuss both options in more detail later, but for now, all you need to know is that you should build a strategy that fits you, your spouse, and your family specifically. Sit back and enjoy (as fun as finances are lol) financial advice for blended families.

Meet with a professional

You should always discuss everything regarding financial matters before you walk down the aisle, whether this is your first, second, or tenth marriage. Even better though, is if you can meet with a professional financial planner. Getting the opinion of a neutral third party who is knowledgeable about money matters will help you make sure nothing gets overlooked. Additionally, the conversation will facilitate dialogue about uncomfortable, unromantic, but very important things. It’s better to have someone on the outside lead the conversation so neither partner can shy away from the subject matter.


Some couples decide to combine their assets upon marriage. If you are the most compatible couple to ever exist, this option makes the most sense as you’ll always keep the lines of communication open—simply because you’ll have to. If you’re deciding to combine resources, you should discuss your monthly budget, decide what’s an appropriate amount of money you can withdraw without asking, and discuss who will be paying bills. Remember that combining everything can be very tricky territory, especially if one person retains control of all the finances.

Keep separate?

If you decide to keep your money separate, you protect yourself from the possibility of the relationship ending. You also avoid being financially dependent on someone else. Does one of you still pay spousal or child support? Are you spending more money on “their kids” than “your own kids?” Are any of these things going to bother you one day? So many things can potentially lead to resentment when families merge. This is a major reason why you should be open to the possibility of drafting a prenuptial or premarital agreement.  And before you scoff at something that has unfairly received a bad reputation, understand why they’re important. Prenups protect both of you, as they make it clear which assets should not be divided in case of death or divorce. If you keep your assets separate, you’re protecting yourself and your children from potentially debilitating outcomes. And remember: doing that doesn’t mean you have any lack of commitment to your new spouse.

Something in the middle?

The very organized couples can work with a blend of both options. You can decide together which expenses you’ll pay for together and have a certain shared account. A popular option is having a shared account for joint expenses and keeping separate accounts for the children you came into the marriage with. All families are different, so find the plan that works for your personality types and relationship dynamics.

Estate plan

When entering into a new marriage, especially with kids, it’s imperative to discuss your situation with an attorney. Navigating the murky legal waters of complex family finances requires professional advice—especially when it comes to ensuring your wishes are carried out exactly after your death. Problems with estate plans, wills, and trusts are where things tend to go bad very fast for unprepared families. Everyone knows someone who died leaving a financial mess for their surviving spouses or children. Who do you want to inherit your assets? Get it written down, signed, and notarized! Blending families is complex. Don’t try to do it alone. Consult your attorney.

Tax Implications

Most people do not put much emphasis on the tax benefits or impacts that come with blending families, but these are crucial to consider. First, couples should try to avoid filing as “married filing separately” because this prevents them from receiving many beneficial tax credits and deductions. For example, a couple filing “married filing separate” would only receive half of a “child care expenses credit” than they would have received filing jointly. Also, filing separately will bump you into a higher tax bracket than if you had filed a joint return. In some cases, both parents of a blended family can claim Head of Household, but this is much less common. Your best option is to speak with a tax advisor before making any decisions on how to structure your assets. Our CPAs at FC360 Tax Services are here to answer any questions you might have and guide your tax planning process.

When blending families …

When blending families, the most important thing you can do is present a completely united front with your spouse. So before you get married, talk about everything—spending habits, saving habits, parenting styles, down to who you want to inherit your assets. Newly married couples with kids must be united when it comes to just about everything financial. Otherwise, children and stepchildren will quickly learn how to manipulate each parent and turn spouses against each other. There’s nothing inherently easy about blending families. But families can best find success by being open, honest, and knowledgeable about potential pitfalls and how to avoid them.

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