In the United States, government-issued child support payments cover only 53% of the expenses associated with raising a child.
This leaves co-parents to manage the other 47% to pay for things like medical bills and extracurricular activities independently, with one parent often footing the bill upfront and seeking reimbursement from the other. This process frequently sparks disputes and arguments between co-parents, who typically communicate via text, message or email.
Jacklyn Rome, founder and CEO of FinTech firm Onward, understands this struggle firsthand.
“I saw my own parents get divorced when I was 14,” Rome told PYMNTS in an interview. “For them, as for most people, money tends to be the number one cause of arguments among divorced and separated parents, and often gets used as a power lever among two emotionally charged people.”
Inspired by her personal experience, Rome launched Onward in January 2020. The platform provides co-parents with a centralized tool to track shared expenses for their children, offering a streamlined solution to the often-challenging financial conversations and decision-making processes that accompany co-parenting.
“The idea [is] to reduce stress and tension among divorced parents and their children [with the goal of] improving the quality of their life, reducing stress in the homes that the kids grow up in, and making sure that the kids have everything that they need to thrive,” Rome said.
Once both parents are on board, they can input their expenses on the platform, categorizing them as needed. This includes not just direct child-related expenses — according to data from Onward, medical and extracurricular activities are the most significant categories — but also household expenditures such as mortgages or phone bills.
The app also allows parents to suggest equitable splits for each expense, based on their individual circumstances or divorce agreements.
Features such as receipt uploads and expense notifications streamline the process, ensuring transparency and accountability. “We keep a record of all of the different expenses so that if co-parents need to go back into court [at some point], they’ll have all of those records available to them,” Rome explained.
Furthermore, the app provides analytics on spending patterns, offering co-parents insights into how they’re allocating resources. With this holistic view of their financial responsibilities, Rome said co-parents are in a better position to make informed decisions and work together more effectively for the benefit of their children.
While Onward’s primary user base consists of co-parents, Rome noted that the platform’s appeal extends beyond this demographic.
For instance, unmarried individuals sharing parenting responsibilities have embraced the app, finding it instrumental in managing their child-related expenses. Additionally, couples experiencing relationship strains are utilizing Onward as a preemptive measure to streamline financial arrangements.
Even couples in stable relationships, recognizing the benefits of collaborative financial management, have turned to Onward for assistance. This growing trend has prompted the launch of Tango, a separate app tailored for couples to jointly manage their finances.
Rome explained the rationale behind the decision to create a distinct app rather than expanding the existing one, saying: “Sometimes, it can be [uncomfortable] to see features for couples if you’re divorced or vice versa.”
Looking ahead, Rome pointed to significant changes in relationship dynamics as playing an important role in shaping the expense-sharing and couple finance landscape.
For instance, with individuals marrying later in life, both parties often come into the marriage with established careers and financial independence. This trend has led to a preference for maintaining separate finances, she said, with nearly 70% of millennial couples choosing to keep at least some aspects of their finances separate.
“All of this makes the way that couples perceive money, analyze their finances and maintain transparency across their various accounts much more complicated,” Rome said. “It becomes increasingly challenging for couples to consolidate all financial information in one place, hindering the ability to make informed decisions on managing finances.”
Additionally, family structures are evolving, with more couples choosing to have children outside of marriage or not to marry. According to Rome, this trend introduces new dynamics to separation and divorce, highlighting the need for innovative solutions to address the financial challenges associated with these non-traditional family arrangements.
Another challenge is the difficulty some individuals face in persuading the other party to join them in utilizing the app — a reluctance which often stems from one party resisting simply because the idea originated from their partner.
One of Onward’s priorities this year is to assist co-parents in navigating this terrain.
“We’re focusing on improving the single user experience to help people whose [former] partners are not willing to use the app with them to still get value out of it. This includes getting paid back, tracking expenses and keeping records even without their partner’s involvement,” Rome said.
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