Tips to Manage Kids' Money Post-Divorce
One area that can be a source of tension during with your co-parenting partner, can be the subject of money. Your kids’ money. Who manages it? Who makes decisions about if/how/when your kids spend it? Whether to invest it? Where to invest it? And the list goes on.
Given that money issues are usually key issues in marital discord and matters of divorce, it’s no surprise that how to deal with your kids’ money can be tricky.
These need to be agreed upon early by you and your ex so that clear and consistent boundaries are set for your child. It is also important that any special money put aside for the child is not mishandled by either parent. This can all be handled easily with a few simple rules, and communication.
1. If possible, work with your co-parent to determine whether an allowance shall be granted to your child. Who pays it, what if anything does the child have to do to earn it. If you and your ex can’t agree, then you can implement your own rules and expectations for when the children are in your care. If this is your only option, then keep in mind that just as your ex can’t control how you manage this while the kids are with you, same applies to you, when they’re with him. You many not agree with his/her rules, but you must respect them.
2. Any savings should go into a bank account in the child’s name. If a parent needs to be named on the account, both parents should be listed unless one agrees that the other can handle it. If the child is given a money gift from another friend or relative, it should be determined in advance how much she can spend and how much should be put in savings.