How to involve every member of the family in money decisions

Not adding your family members to money decisions can create resentment, unhappiness and a sense of discontentment. This is why it is imperative to involve your family in money decisions. Here's how.

financial decisions

We often see that money decisions are made by one member of the family, in most cases, the one bringing in the moolah. Other members, such as dependent parents and kids, do not have much say. This creates resentment, unhappiness and a sense of discontentment. This is why it is imperative to involve your family in money decisions. 

Here are six tips to do it.

1. Keep the conversation positive: One of the biggest mistakes people make is making financial conversations awkward, uncomfortable and negative. This need not be the case. When your kids demand an expensive game or your spouse is looking for a costly gadget or jewellery, do not instantly shut them down. Instead, have a rational conversation with them as to what is possible at that point in time and what is not. 

Also ReadFour Red Flags To Avoid Poor Financial Decisions

2. Get family buy-in for big expenses: Any big expense should be a family decision. Want to buy a new car, 85-inch TV or give your home a makeover? Get everyone, from your parents, partner, to your kids, involved in the decision. Encourage everyone to do their research online. Set a family meeting time where all members can share their inputs, deliberate and decide on which car or TV would be best for the family.

3. Learn to let go: Do not go to war for every money decision. Choose your battle wisely. If you are stringent with every expense, it is bound to create resentment. If a purchase doesn’t really hurt your pocket, embrace it. For example, if your partner wants to engage in light online shopping or your child wants to go out to eat, go for it. You will be surprised at how much happiness these small gestures bring in.

4. Set financial goals together: Responding to every family request with a threat is an absolute no-no. Do not tell your kids you cannot send them to a good college or take them on vacation if they want to buy something right now. This does not work. Instead, when setting financial goals for the family, make them part of the process. If a big Europe trip is what everyone is dreaming of, set up a travel fund and tell them some of the sacrifices they will have to make for it to happen upfront. 

Also ReadHow To Create A Vision Board For Your Financial Goals?

5. Create accountability: Money decisions are not the sole responsibility of the people bringing in the funds. Every member, even if they are a dependent, needs to share accountability for how and where money is spent. This needs to be communicated well in a positive setting. Every year, review the family’s finances and the money decisions taken. Tell them what goals you all were able to achieve and what needs to be done for the coming year. Be as open and transparent as you can. 

6. Choose democracy over authority: No one likes a dictator. Seek advice from your parents, discuss things with your partner and hear out your kids. They will feel that their opinions matter and, more importantly, bring peace and happiness to your family. It will also help inculcate financial responsibility and discipline in the family. After all, nothing works better than equity and justness. 

These simple tips can prove to be highly effective and make money decisions easy. Try them.

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