Talking to your loved ones about money can be stressful. It can feel impolite or uncomfortable to discuss your finances when we’ve been taught that it’s a taboo subject. But it doesn’t have to be that way! We’re sharing eight steps you can use to have positive money conversations with the important people in your life.

About a third of adults with partners say that money is a major source of conflict in their relationship, and a report from 2019 found nearly a quarter of parents were hesitant to talk to their kids about finances. Talking to your loved ones about money might be hard, but the benefits are worth it. When you’re having frequent conversations that are useful and effective, money shouldn’t cause angst, stress or anxiety. 

Here are eight steps for having positive money conversations with your loved ones.

  1. Accept the initial awkwardness
  2. Listen with kindness
  3. Schedule regular chats at a time that suits everyone
  4. Keep your conversation distraction-free 
  5. Recognize you all hold unique views about money
  6. Set goals together
  7. Budget your way to happiness 
  8. Keep asking questions

Accept the initial awkwardness

Money has always been viewed as a topic best left behind closed doors, along with religion and politics. On top of that, everyone has a different personality, background and life goals. With your differences, conversations are bound to be challenging at first! 

But, remember how on any first date, getting to know someone can be this incredibly awkward thing, but the more you spend time together, the less awkward it feels? It’s the same with money! The more you talk about it, the less uncomfortable you will feel and the more natural it becomes.

Listen well, and with kindness

The most obvious step in talking about money is listening to what the other people in your conversations have to say. It’s the best way to find common ground for you all to work from.

Employ some active listening to fully understand what they’re trying to tell you. Pay attention, show them you’re listening with cues like nodding, and provide feedback on what they’ve said. 

Be sure to also reserve your judgment, as finances can be an emotional and personal topic. If you listen with an open mind, they are more likely to be honest with you. 

From here, building trust and shared goals will come, and soon you’ll find nothing is off-limits when it comes to money. 

Schedule regular chats at a time that suits everyone

Let’s face it. In a relationship or family, one person - let’s call them the Family Chief Financial Officer, or CFO for short - is usually more ‘into’ money than the rest. 

That is absolutely fine. 

But it’s vital that even if the Family CFO is doing all the day-to-day budgeting and bill paying, all family members understand what’s going on.

To do that, you have to discuss money and you may have to set aside time to do it. What that looks like differs from family to family. It could be:

  • A two-minute chat while you sit down to dinner at night;
  • A weekly catch-up on a Saturday morning over coffee; 
  • A meeting on the 1st of each new month to set some goals for the coming month.

Choose a time that works for you all. The key is that you both have to come into the conversation ready to chat. 

Keep your conversation distraction-free 

Pick a distraction-free meeting place that everyone agrees on. 

Writing a list of what you want to chat about also helps keep the conversation on track.

Here’s a sample agenda:

  • I listened to a podcast about ‘prepping for retirement’ and it made me think, “are my parents happy with their investment fund set-up, or do they need a relook?”
  • I saw a great deal for an allergy-friendly vacuum cleaner, which we need! Should we go ahead and purchase it now?
  • Deb at work passed me a discount coupon for Amigos. Shall we have dinner out? Have we budgeted for this?
  • We updated our will recently, but have we shared it with the rest of the family?
  • Christmas. Agh! Have we started saving money for this yet?

All this day-to-day life admin is worth chatting about because you will bring your own perspectives to the table. This can only help you all make better decisions.

Recognize you all hold unique views about money

No matter where you’re from, most people will credit their upbringing for shaping their money habits, both good and bad. Psychologists have found that money can impact our behavior and morals, regardless of our economic situation.  

Recognizing each other's perspectives around money will really help you understand the ‘why’ behind your partner’s actions and words. But it’s equally important to acknowledge any negative money behaviors and address these. The beauty of being an adult is that you get to write the script.

Keep what you find helpful, be excited about your future, but let the rest go.

Set goals together

Few people go on holiday without knowing where they are going. Yet with money, we often amble along with no clear idea of where we are headed, making it very easy to get lost along the way.

It might be that you and your partner really want your mortgage gone as quickly as possible, yet you have signed a 30-year mortgage with your bank, which will prevent that from happening. By discussing this and setting a goal together, you can make extra payments and become debt-free far sooner.

Or maybe your kids are thinking of starting a family, and you would like to retire early to help look after their children. By discussing this and financially planning for it in the years leading up to grandparenthood, you can make this a reality. But only if you set it down as a goal.

The key is to think and work as a team, even if you have some goals that are different from each other. Just talk them through and compromise, reach an agreement and make a plan. 

Budget your way to happiness 

Budgeting can sometimes cause the most angst, but it doesn’t have to be at the top of your list for how to talk to your loved ones about money. You need to get the communication flowing first.

Once you can see everyone’s position, motivations and goals, setting a budget should flow quite easily. 

For example, if you are spending $75 on lunch a week, but as a couple, you and your partner have decided to pay off your car loan quickly, then it becomes a relatively obvious choice for you to start bringing your lunch from home. You’d then divert what you would’ve spent buying lunch to the car payment instead. You will feel far happier with your homemade lunch when you can then track the progress of your shared goal to pay off the car.

A budget isn’t a restriction. It’s spending on the things that make you, as a couple or family, collectively happy. 

Keep asking questions

At your regular money catch-ups, remember to keep asking questions and reviewing the status quo.

  • Have your goals changed?
  • Are you sticking to your shared goals? 
  • Have you not budgeted enough, or too much, in one area? 
  • Does everyone have access to the information they need?

Tweaking and changing are all part of a healthy process. It will take time before you see the strengths and weaknesses in your plan, as well as your behaviours around money. 

Keep talking these through, and before long, any stress and anxiety you feel around money will start to leave you.

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