Family Finance Meetings: When To Have Them & Why

By Robert Blakely, CFP®, AIF®, ChFC®

Summer vacations are an opportunity for families to grow closer to each other and to build life long memories.  It’s also a great excuse to schedule and discuss financial well-being and preparedness since important topics like this are often overlooked. As a financial planning firm, we often schedule periodic reviews with our clients throughout the year to plan, reassess strategies, and refine direction based on changes to our client’s needs. So, wouldn’t it make sense for families to have the same conversations among each other?

You work hard to teach your kids what they need to become well rounded and successful adults. You teach them which foods are good for them, how to play fairly with friends, and encourage them to build a strong work ethic and moral compass. You do these things because you recognize that the lessons, they learn today will ripple outwards through their lives as they move on to their own careers, their own families, and their own challenges.

Why not work just as hard to teach your family to build strong financial habits?

Letting these difficult conversations slide may be easier, but when you rob your children of their ability to learn from your mistakes, you doom them to learn from experience. The cost of poor money decisions your child makes in their twenties could permanently dampen their lifetime earning potential set them back decades. Families who make a concerted effort to have financial discussions and pass on healthy habits have a better opportunity to grow financially stronger than those who avoid the talk.

Family finance meetings aren’t just for those of us with kids, however. Statistics tell us that one in five couples who filed for divorce last year cited finances as the reason that they split. Whether we like to admit it or not, money plays a role in just about every aspect of our lives. Your financial resources will directly impact the vacations you take, the insurances and protection you can afford, the opportunities you can provide to your spouse, and everything in between. You and your significant other can stay in sync on spending and other related finances by having regular healthy planning discussions.

How do we broach what sometimes can be difficult financial subjects with loved ones? The simple answer, like most things in finance, is that there is no one size fits all solution. Not only do people, and their family relationships differ greatly between individuals, but value itself is subjective. What’s important to one family may be far down on the list for another. What one couple might find to be a perfect solution could create additional stress for another. The answer starts with open and honest communication.  That’s how we approach it with our clients at Blakely Financial.

Create an environment where each member of the family can discuss where the finances are today, and where they would like them to be in the future. With a goal clearly stated, the task and the conversation become simpler. The question to ask yourself is this. “How do I create a forum in which each member of the family has the opportunity to clearly offer their input on the family’s financial picture?”

For couples try sitting down once a month, opening a bottle of wine, and reviewing the credit card statement. Create a judgement free zone, where line by line you review spending habits and come to agreement on things you’d like to do more or less of. Keep in mind that the objective here is not necessarily creating a budget or identifying wasteful spending, its simply to recognize, and reconcile each person’s view of the family’s finances.

Some families may choose action steps and start setting goals and outlining responsibilities of each party. Most will find that simply having an opportunity to look at the big picture, together, strengthens bonds and gives everyone more insight into why the other is doing what they’re doing. Open and honest dialogue creates certainty of where the family’s finances stand, that alone reduces the chances of becoming overwhelmed and disorganized which is typical when discussing finances.

Financial teamwork strengthens bonds by cultivating a sense of camaraderie and a mutual appreciation for each other’s work. If you and your spouse can calmly and openly discuss spending and savings habits, you will be well on your way to not only financial balance but a healthy happy relationship. Seeking advice and guidance from a financial professional is also a great addition to conversation. This will quickly set yourself apart from the average American household.

Those with children, discussing dollars and cents may seem a little more difficult if the people at the table are more worried about superheroes and sleepovers than they are with financial responsibility. Once again this will need to be a discussion that couples have together on how best to involve children in the family finances. Keeping everyone at the table after dinner to discuss a savings goal may be a good place to start. Beginning with something tangible, a reward even, may also lead to some interesting discussion.

Bring the family together to decide on where next year’s vacation might be, discuss the costs associated and in simple terms draw up a savings goal for your trip. Each month discuss how much you were able to save, how much you have set aside, and how close you are to achieving your goal. Encourage your children to contribute small allowances and thank them for doing so. When trip time comes around, recognize that you are only able to enjoy this experience because of the hard work and patience you showed in saving up.

Something as simple as creating a basic family budget, where monthly amounts are discussed amongst everyone at the table can begin to introduce your children to the concept of planning out income and expenses ahead of time rather than taking them on as they come. In an era where most families are living paycheck to paycheck, you will be giving your children a head start to communicating about finances. As many people learn the hard way, we inherit many of our habits and behaviors from our parents, good and bad. Even if your children are only loosely connected to the discussion, they will be internalizing some very important skills. You will be giving them exposure to prudence, cooperation, and communication, valuable traits that will serve them well for the rest of their lives, and their children’s lives. And building “Legacy” lessons is crucial.

Regardless of how you decide to broach the subject, or who is sitting at your table, the important thing is that you have the conversation. Whether it’s an in-depth budgeting discussion, or a brief few minutes after dinner to talk through the bills this month, you really can’t go wrong by discussing your family’s finances in a calm and constructive way. You and your partner will be stronger and happier for it, and your children will be internalizing critical life lessons about how to handle money, how to treat a spouse, and how to discuss difficult subjects with loved ones.

The importance of having the family finance conversation cannot be understated. Money is threaded through everything that you and your family hope to do in in your lives, and it can make or break you. Don’t procrastinate or let tensions boil over concerning finances.  Be a family that cooperates and plans together. This Summer schedule in a “Family Financial Meeting”. You will be able to experience more, together, for generations to come.

Blakely Financial, Inc. is an independent financial planning firm from High Point, North Carolina specializing in Financial Planning, Investment Management, Retirement Planning, Estate Planning, and Charitable Giving Strategies.

Robert Blakely CFP® is a recognized Chairman Level Advisor, affiliated with Commonwealth Financial Network, and founder of Blakely Financial, Inc,. who focuses on comprehensive wealth management. rob@blakelyfinancial.com