My Finances

Did you know that money is the main source of potential conflict within a family? Not only do parents have to constantly contend with the desires of their children, but adults must also learn to distinguish between their own wants and needs. Here are a few reflexes you can work on to help yourself survive amidst the jungle of demands tugging at you from all directions.

Balance is impossible without planning

In a family, some members seek to build savings, while others are more inclined to spend using credit. The important thing is to strike a balance so that everyone feels like their choices are being respected and the family maintains its financial stability, as well.

Together, come up with a list of non-negotiable financial objectives, like paying off the mortgage, saving for education, planning for retirement or making significant purchases. Then find a way to save money systematically. That way, you can be sure it will be there when you need it.

The key is for both spouses to contribute financially to achieving the family's goals, in proportion to their income. Obviously, staying disciplined to respect the commitments you make together is essential for all of this to work.

Priorities for blended families

Making a family with your new spouse, your spouse's children, and your own can lead to certain issues on the financial front. To make the transition as smooth as possible, it's a good idea to:

• Have clear legal parameters regarding past spouses
• Draw up a cohabitation contract/agreement, if applicable, that defines the sharing of financial responsibility for family and child-related expenses
• Get life and health insurance that adequately covers all of the new family's needs
• Protect your children and your new spouse by making a notarial will and a mandate in case of incapacity

Leaving your assets to loved ones? Beware of the consequences!

If you wish to do this, you should know that this decision could reduce your standard of living, for example, if you encounter unexpected expenses during retirement, such as specialized health care.

Try and maintain a balance between your current financial obligations and your desire to give to your loved ones, both while you're living and after you pass away. Think about getting life insurance that will go to your beneficiaries without being taxed.

For further advice, don't hesitate to consult with one of the experts at Desjardins. They can help you better manage the emotions that come with making financial decisions for you and your family.