I just migrated to Family Sharing from this setup. You can't see each others locations unless you opt in, and you aren't any worse off from the shared app store account setup.
Each had separate iCloud accounts. All used a single shared_app_store@address.com account for iTunes and Apps.
1. Create a new user account in System Preferences > Users & Groups
2. Log in Mac as that user.
3. Go to System Preferences > iCloud and sign in with that shared_app_store@address.com account
4. Log in to Mac as user that will have billing control - the "Organizer"
5. Go to System Preferences > iCloud > Set Up Family and enable
6. Change "Family Purchases" to the iCloud account of that user
7. Invite shared_app_store@address.com to join the family and enter the password to set up
8. Log in Mac again as the new user account created in step 1
9. Go to System Preferences > iCloud > Manage Family
10. Choose the Me user and ensure "Family Purchases" is set to the shared_app_store@address.com
11. Log out of this Mac user account. You can now delete it.
12. Log in again to Mac as user that has billing control - the "Organizer"
13. Invite the other iCloud accounts. On their device, go to Settings > iCloud > Family > Me and change their "Family Purchases" to the iCloud account of that user
14. On all devices, go to Settings > iTunes & App Store > and sign out of shared_app_store@address.com and sign in as the user's individual iCloud account
15. Open Apple Music, purchase the family plan on any device (and it's okay if you had already purchased it under the shared_app_store@address.com account)
16. All users will have individual profiles, and can play simultaneously.
Don't fear anything:
All purchased apps and music work as before and keep updating correctly
There is no downside compared to the shared_app_store@address.com approach.
Behind the scenes, that's what it's doing anyway.
I also have a more points with this, so I invite others to clarify or add their own opinions.
In-App purchases will not work or transfer from the original shared_app_store@address.com to the individual accounts.
Moving forward, purchases for each person will be tied to their account so they retain their purchases if they ever leave the family account (eg. my daughter when she gets older will retain all purchases made by her).
I think the longer I wait the more issues will have. I am going to do some house cleaning on my apps and determine exactly what may happen if I do this.
I may setup test on my iPad and change the shared account to the normal account and see what happens. From what I can tell, I should be able to revert to the original shared account if something bad happens.
The only two people sharing my account are myself and my wife (both kids have their own account and they have their open purchase history). I don't want my wife's music history messing around with mine on Apple Music.
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