Money Messages During Divorce: Think of the Children

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Divorce is a challenging, emotional, and transformative experience for everyone involved, especially when there are children to consider.

While splitting spouses are managing legal complexities, financial restructuring -- and their emotions -- it's easy to overlook how divorce is also influencing children's perceptions of money and their long-term financial well-being.

Even seemingly resilient children can be deeply affected, and it's crucial to proactively guide them toward a healthy relationship with money. For affluent parents navigating divorce, intentional strategies centered on values alignment, structured wealth education, and collaborative legacy planning are critical to nurturing children’s capacity to steward family assets responsibly.

This article offers practical strategies to support your children's financial development throughout and following a divorce.

The Impact

Divorce always creates change of some sort, and very often it creates instability.

Children may experience uncertainty, inconsistent parenting styles, and conflicting messages, which can affect their relationship with money. Even if they appear to be handling the situation well, the effects can be long-lasting.

Children of divorce aren't doomed to failure. However, they may face increased risks, and tension especially if conflict between parents continues after the divorce. These risks can impact their overall sense of security, their ability to form healthy attachments, and their identity -- all of which can have a significant impact on their financial attitudes.

Parents need to focus on their children’s overall well-being. Children's reactions to divorce can vary. Some might replicate their parents' financial habits, others might completely reject them, and some might rebel in other ways.

With intentional effort, parents can help shape and balance these reactions to the divorce.

A Sense of Well-Being

When navigating a divorce, prioritizing your children's well-being should be paramount.

This includes not only their emotional and psychological health but also their future financial stability. The messages and behaviors you model around money can significantly impact their own long-term financial outlook.

One challenge: divorced parents often have different perspectives on money. These differences may have even contributed to the divorce itself. Navigating these differing views and creating a unified front – even on the most difficult days of divorce -- can be tricky and emotional but is essential for your children gaining a sense of their own financial health.

The subject of money can be uncomfortable and sensitive, making it tempting to avoid direct conversations. However, addressing this topic is vital to provide children with a well-rounded, well-adjusted, and well-prepared perspective on the world.

Markers of financial well-being for children include avoiding a sense of entitlement, managing financial jealousy, maintaining ambition, and resisting over-indulgence. Instead, focus on instilling values centered on the responsible stewardship of resources, which fosters maturity, responsibility, hope, and a healthy pursuit of financial prosperity.

The Approaches

There are any number of ways to get this process started with children. Here are a few to get you started.

• Actions, not words -- Children learn more from what you “do” versus what you “say.” At a very early age, children can spot hypocrisy and recognize a “do as I say, not as I do” methodology. So, make sure your actions match your words when it comes to money. If you say saving is important, make sure they see you saving, too.
• Be Appropriately Transparent -- Saying things like "Your Mom never pays her child support on time" can hurt a child's relationship with the parent not in the room at the moment. Be careful about sharing too much financial information when children are too young to understand, and it is important to model respect for each other during this difficult time.
• Avoid Impulses -- There may be an impulse to shower kids with gifts during or after a divorce. Unfortunately, this may lead to a sense of entitlement and a lack of appreciation for the value of money. Instead, focus on experiences. Irrespective of divorce, it can be important to help your children build self-control and patience by creating a delay in getting what they want. For example, instead of buying them something right away, make them wait a day or two. This can make them appreciate it more!
• Use Allowances as a Tool -- An allowance is a great way to build lessons and values around money and resources. Make sure children have responsibilities that “aren't” tied to money, like certain chores or homework. As they get older, give them more control over their allowance and what they spend it on. Also giving a monthly allowance instead of weekly teaches children to budget throughout the month. Money lessons early in life will serve them well in adulthood.
• Prioritize Spending Changes -- Be open about any changes to your family's finances. “I know we used to go on more elaborate vacations, but now our circumstances have changed, and we can still enjoy our time and company vacationing closer to home.” If you can't afford to do certain things anymore, explain why. It’s important to avoid blame of your former spouse in this conversation as well. This can be a chance to teach them about being resourceful and finding creative solutions. Remember: family activities are important, so consider opting for experiences over material possessions when possible.
• Negotiate Competing Money Messages -- Many divorced parents continue to follow patterns of chronic conflict after divorce. Parents navigating divorce should try to refrain from engaging in post-divorce conflicts over appropriate spending habits, while encouraging a stable and supportive environment for their children’s future -- a future that, with effort, intentionality, and guidance, includes a quality relationship with resources and money.

The Bottom Line

Navigating the complexities of divorce can be an overwhelming and isolating experience, especially for individuals with complicated financial portfolios.

However, you don’t have to face this journey alone. Specialized professionals can serve as invaluable allies, offering not just financial expertise but also emotional and educational support throughout the process. By working with professionals, you can gain clarity, confidence, and peace of mind.

Charting a financial course during and after a divorce will help your children feel better and more confident about their own personal and financial futures.

Sharon Klein is President of Family Wealth, Eastern U.S. Region, for Wilmington Trust, N.A., Sharon is responsible for overseeing the delivery of all Wealth Management services by teams of professionals, including planning, trust, investment management, family education, family office, and private banking services. Sharon also heads Wilmington Trust’s National Matrimonial/Divorce Advisory Practice.

Marguerite C. Weese, Chief Operating Officer, Wilmington Trust Emerald Family Office & Advisory, helps individuals and families identify their philanthropic goals and develop an impactful, values-based strategic giving program. Marguerite facilitates workshops that utilize philanthropy to help educate and engage multigeneration. The Emerald team guides clients in the creation, implementation, and execution of complex financial, estate and succession plans.

This article is for general information only and is not intended as an offer or solicitation for the sale of any financial product, service, or other professional advice. Wilmington Trust does not provide tax, legal or accounting advice. Professional advice always requires consideration of individual circumstances. Wilmington Trust is a registered service mark used in connection with various fiduciary and nonfiduciary services offered by certain subsidiaries of M&T Bank Corporation. This information has been obtained from sources believed to be reliable, but its accuracy and completeness are not guaranteed. Opinions constitute the judgment of Wilmington Trust and are subject to change without notice.