Talking about money can be about as awkward as talking politics at Thanksgiving, but unlike dinnertime politics, money matters don’t go away once the dishes have been cleared. The longer you avoid the talk, the worse the problem (and stress) gets, which only makes it more tempting to avoid talking about it. Thus begins the eternal cycle of high-stakes silence.
Sound familiar? It might — three in five people don’t talk about money. A money-free conversation may sound like the recipe for a happy home, or at the very least, polite dinner conversation. But consider this: 61 percent of Americans say they didn’t learn personal finance in school, and 52 percent say money was not discussed at home. No wonder people are Googling money questions more and more; it can feel easier to take financial advice from a stranger than begin a conversation with the people who matter most to us, the people who actually have stakes in our financial success.
So let’s get to the root of the problem. Research shows that people fear money conversations for three reasons. Stick with us to learn how to overcome each one skillfully, whether you’re talking to a partner, kid, or even a friend.
Fear 1: Talking about money will highlight different personal values.
It’s easy to say everyone’s on the same page about money — most of us know we need to spend less and save more — but when you dive into the ‘why’ behind your reasons for spending or saving, you can realize that not only are you on different pages, you’re reading different books.
Sure, you both want financial success (who doesn’t?), but maybe one person pursues it because they want to feel financially free, whereas the other craves the feeling of financial security. The values of freedom vs. security can lead to contradictory saving/spending strategies.
Or maybe you’re trying to teach your kid financial basics. You might value a structured, controlled approach while your child values independence. In both cases, the values seem like opposites. You can try to change the other person’s values, but odds are you’ll do more harm than good. No one appreciates being told who they are or what they stand for.
The answer: View differing values as an advantage, not an obstacle.
It all comes down to perception. When you look at these values and see a disconnect, don’t jump immediately into an either/or view. One value isn’t innately more problematic than the other; in fact, those values may just be part of why you love that person (or yourself).
Instead, ask yourself how you can create a financial strategy that honors both values. Someone who values financial freedom, for example, may not thrive with a weekly budgeting spreadsheet, but they might save in an instant for the ability to buy their own home or quit their 9-5 one day. If you, say, value security and want your partner to take your budgeting sessions more seriously, try framing it in a way that makes sense to them. Introduce an emergency savings or a new-home fund by showing them how saving money awards them with personal freedoms rather than focusing on how to limit their lifestyle.
(Read: 4 Steps to Lower Your Debt by January)
Or, if your child wants to feel financially independent, ask yourself how you can honor that value without sacrificing your own. Maybe you’re comfortable giving them a debit card as long as you can easily turn off the card later. Or maybe you don’t want them touching swipeable money until they know the pros and cons of credit — if so, try asking them what they want to know about credit instead of sitting them down for a lecture. (That’s the good thing about money; everyone’s interested in it, even kids.) You might be surprised to hear questions you both need the answers to.
When you look at your conflicting values as resources rather than obstacles, you set yourself up for a much easier, more productive conversation.
Fear 2: Talking will reveal bad money habits you (or the other person) aren’t ready to fix.
We all have our bad habits. That’s the thing about being human; no one is doing it perfectly 100 percent of the time. That’s also what makes a money talk so intimidating. We rarely enjoy pointing out others’ bad habits, and when someone points out ours? Forget it. Especially if we’re not ready to fix them.
What do you do when you need to point out the way someone else’s spending/saving habits are affecting you? Or, worse yet, how do you accept feedback gracefully when someone talks to you?
The answer: Look at growth in a non-linear way, both in yourself and others.
If you’ve ever heard the phrase, “Two steps forward, one step back,” you know what we’re talking about. Growth is going to be uncomfortable, both for you and the other person, and it will often feel like you’re doing something wrong. But if you’ve got your eyes set on financial success, you’ll have to choose growth over discomfort. If not now, then when?
There’s a term in psychology called a liminal space, which is a place of transition. You can think of it as the hallway between where you are now and where you want to go, when neither the past nor the future seem to fit you quite right. If you’re not sure if you’re in a liminal space, look for its hallmarks: discomfort and uncertainty. And if you’re feeling those, congratulations — you’re on the road to change.
The good news is that you’re probably overestimating how uncomfortable the money talk will be. Research shows that in romantic relationships, couples tend to focus on the drawbacks of talking finances rather than the obvious benefits, like added closeness or long-term wealth. While we don’t have stats for relationships like business partners or kids on hand, we’re willing to bet the same principle holds true: If you tackle the conversation with authenticity (no matter how uncomfortable it feels), you’re more likely to walk away satisfied with the outcome.
Fear 3: Money talks involve decisions with long-term consequences.
The very thing that makes a money talk so crucial to financial success is the same thing that makes it so intimidating: High stakes. Discussing finances is linked to building generational wealth, financial freedom, and transparency in relationships. Keeping quiet can lead to both short-term and long-term issues, and on some level, most of us know it. Financial success is built on making sound decisions, not just once but time after time.
Strangely enough, that pressure doesn’t make it any easier to start the conversation.
The answer: Take the pressure off yourself and your loved ones by leaning on the experts.
The decisions you make when talking about money will no doubt affect you. But that’s true of every decision, whether you’re choosing what to eat for lunch or deciding which savings account is right for you.
Making decisions confidently requires a dash of self-trust. If you don’t trust your ability to make strong financial choices, look back at the ones you’ve already made. You’ll see a slew of mistakes, just like everyone, but you’ll also find you made the best decisions you could with the information you had at the time.
Of course, the more information you have, the better prepared you’ll feel to make those decisions, and the more you’ll learn to trust your choices. If you’re an ICCU member, you can get a quick (and free!) education on big financial topics through MoneyEdu. Learn the ins and outs of credit, how to pay off debt, and even how to teach your kids about money.
When you learn to trust yourself and the right experts, you’ll see that talking about money is an opportunity, not something to dread. Every time you do it, it gets easier. If you’re not sure where to start, browse the MoneyEdu articles below to get some tips and tricks.
