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How To Fix Your Dysfunctional Family Finances

by Neal Frankle, CFP ®, The article represents the author's opinion. This post may contain affiliate links. Please read our disclosure for more info.

If you feel like your family is a little off center when it comes to money, you aren’t alone.  I’ve met very wealthy people who find it difficult to strike a balance and I’m convinced this isn’t just a function of how much money they have.  Even though I feel like my family is fairly secure, each member of the clan thinks about finances a little differently.  This can create problems when it comes to deciding how to spend, how much to save and how to invest.

We are still in the process of working all this out and my guess is that this process never ends.  Here’s the plan I am going to suggest we put in place:

Step 1 – Prepare

Each family member privately writes down what they like and dislike about their own financial behavior. That includes the money we earn and spend. The writing will include a self-assessment of our understanding and attitudes about money too. Then each person writes about how they imagine these behaviors impact the other members of the family. If there are negative consequences for others, each person writes what they think they should do to fix it.

Then each person answers the same questions about each of the other family members.  On top of that, it makes sense to share at least some financial numbers with everyone so they have context.

Step 2 – Show Time

The family has a pow-wow and each person shares their writing. First, they talk about their own financial strengths and weaknesses. Then each person in the family will speak about their feelings about the others. This must be done in a loving non-accusatory manner or it will blow up. That’s one thing I am concerned about.

Once everyone has a turn to speak each person responds to the others’ concerns and tells them:
a. what they are going to do about it or
b. why they think it’s not a problem

Hopefully, this will lead to some dialogue. If we reach an impasse, we’ll just defer and focus on those things we do agree on that need addressing. We’ll need an impartial moderator to make sure this works.

3. Accountability

Last, each member of the family picks an accountability partner and sets up bi-monthly meetings. They agree on a plan and they track the person’s execution along that plan. They celebrate success and come up with a strategy to address whatever is lacking.

4. Family Progress Meetings

Each month we’ll meet as a family to discuss the successes and the failures. We’ll encourage each other to keep up the good work and try to help each other overcome obstacles. We’ll go back to step 2 and allow everyone to chime in on those things they are working on, what they appreciate about the other people and what changes they’d still like to see.

I don’t really know if this is going to work but I’m going to give it a try. Don’t get me wrong. There are a few things that aren’t working but we don’t have a crisis. This isn’t a huge problem for my family thank goodness. But my experience tells me that small problems can blow up over time if not addressed. The solution is communication, understanding and action.

I’m kind of excited about this process. Do you think this will work? What changes would you make to this plan?

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Who is Neal Frankle

Neal Frankle

I'm a CERTIFIED FINANCIAL PLANNER™ Professional with more than 25 years of experience. I feel very blessed and hope to share my personal financial experience and professional wisdom with readers of WealthPilgrim.
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Retirement financial education for people age 55+ seeking to retire well and for those retired seeking to enjoy a better retirement.  We discuss retirement planning, retirement investments, taxes in retirement, retirement spending, IRA and 401k distributions and we will personally answer questions that you pose in the video comments.

While so much financial information is about preparing for retirement, what about managing your finances in your retirement years? That's exactly what we cover at Retirement Crusaders.

Neal Frankle is a retired registered investment adviser. Larry Klein is a retired financial advisor and retired CPA. They have 70 years of financial advising experience to share so that you have your best retirement years.

Retirement financial education for people age 55+ seeking to retire well and for those retired seeking to enjoy a better retirement. We discuss retirement planning, retirement investments, taxes in retirement, retirement spending, IRA and 401k distributions and we will personally answer questions that you pose in the video comments.

While so much financial information is about preparing for retirement, what about managing your finances in your retirement years? That's exactly what we cover at Retirement Crusaders.

Neal Frankle is a retired registered investment adviser. Larry Klein is a retired financial advisor and retired CPA. They have 70 years of financial advising experience to share so that you have your best retirement years.

YouTube Video UCoU0buhwVplzXrsyf342nOg

Retirement Crusaders

June 10, 2022 1:19 PM

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Retirement financial education for people age 55+ seeking to retire well and for those retired seeking to enjoy a better retirement.  We discuss retirement planning, retirement investments, taxes in retirement, retirement spending, IRA and 401k distributions and we will personally answer questions that you pose in the video comments.

While so much financial information is about preparing for retirement, what about managing your finances in your retirement years? That's exactly what we cover at Retirement Crusaders.

Neal Frankle is a retired registered investment adviser. Larry Klein is a retired financial advisor and retired CPA. They have 70 years of financial advising experience to share so that you have your best retirement years.

Retirement financial education for people age 55+ seeking to retire well and for those retired seeking to enjoy a better retirement. We discuss retirement planning, retirement investments, taxes in retirement, retirement spending, IRA and 401k distributions and we will personally answer questions that you pose in the video comments.

While so much financial information is about preparing for retirement, what about managing your finances in your retirement years? That's exactly what we cover at Retirement Crusaders.

Neal Frankle is a retired registered investment adviser. Larry Klein is a retired financial advisor and retired CPA. They have 70 years of financial advising experience to share so that you have your best retirement years.

YouTube Video UCoU0buhwVplzXrsyf342nOg

Retirement Crusaders

June 10, 2022 1:19 PM

Subscribe
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