Do you find it difficult to talk about money with loved ones? You’re not alone.
A few years ago, an old acquaintance who was moving to Sydney pinged me on Facebook to ask how much rent I was paying and how much I managed to save every month so she could plan her household budget. I remember being horrified at the question. Didn’t we all know it was impolite to discuss personal finances with friends and family? And even more so with old acquaintances? I obviously chose the polite route of ignoring her message.
Fast forward a few years and here I am, writing for a personal finance website, encouraging people to talk about their financial situation. I’ve come a long way from thinking money conversations are best avoided, to now strongly believing that open and frank discussions about money can be liberating and open doors for gaining financial knowledge. Think about it – if you never talk about it, how will you ever learn about it?
Apart from being considered an ‘impolite’ subject for discussion, part of the stigma attached with money conversations also comes from the fact that ‘finance’ for many of us has been a scary topic. While some of us just don’t know enough about it, others think of it as too hard. And who wants to look stupid in front of their friends? So the safest option is to just not talk about it.
In fact, according to a recent survey, money is a bigger taboo than sex, religion or politics. More than half the people surveyed ranked personal finance as the most difficult subject to discuss with family, friends and colleagues.
“We’re moving towards the holiday period when people, typically, are more likely to get together with loved ones than at any other time in the year.
But the survey shows that what they are least likely to be discussing is personal finance – including income, taxes, pensions, debt, savings and expenses.
“Money remains the biggest social taboo,” says Nigel Green, the founder and CEO of deVere Group that conducted the global survey.
So how do we break this taboo around talking about money?
Improve your knowledge about money.
Like they say, knowledge truly is power. Spend some time each week trying to improve your understanding about money. Subscribe to a personal finance blog, tune in to financial shows on the television, sign up to a finance course or listen to financial podcasts on your way to work. Whatever you do, keep it consistent and try to look for mentors or people you can ask questions about whatever it is that you’re trying to learn.
Set yourself some financial goals.
Depending on your financial situation, set yourself some realistic financial goals for the new year. Think about what you want to achieve financially – start by asking yourself some questions about your top priorities:
- do you want to kick debt?
- do you want to save a deposit for a new house?
- do you want to understand how you can make the most out of your superannuation?
- do you want to learn more about the best avenues for investing your money?
Then spend some time each day learning how you can achieve that goal. And don’t be afraid to talk to your family and friends about it. They can not only help you stay on track towards achieving your goal but may also be able to share their knowledge or experience in a similar situation.
Talk about money.
Finally, the only way that we can normalise this conversation about money is by really talking about it. There’s nothing embarrassing about discussing finances with your spouse or your friends. In fact, so many of our daily decisions are based on our current financial situation, it would just make life so much simpler if we could all be honest about it.
For instance, if you could just tell your friends you can’t afford that fancy new place this weekend because you’ve just bought your mum an expensive Christmas present, they wouldn’t feel bad about you bailing out of the plan.
What’s more, all this secrecy around money only helps perpetuate an unfair environment.
“When money is an awkward topic of conversation, it is easier for people to get an unfair deal. These people typically tend to be women, younger people and ethnic minorities. Silence about money issues can often allow the unfairness to continue unabated,” says Green.
We use money every day, it’s an essential part of our lives. So it’s high time we get more comfortable discussing it.
If you have any personal finance questions that you want answered, tune in to ‘Ask Kochie’, the Facebook Live session with David Koch every Tuesday at 1.30pm.
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