Eight Tips to Help You Have Tough Conversations About Money

Money is a touchy subject that doesn't usually come up easily in conversation. 

However, there are some occasions when we need to have challenging conversations about money with someone close to us

Examples might include: 

• Your aging parents tell you they're moving into assisted living because of their worsening health.
• Discovering your partner has been dishonest about his/her spending habits or credit card debt. 

Whether dealing with an elderly loved one's finances or a relationship, these 8 tips will help make those conversations easier.

1) Bring someone with you for emotional support

This person can be a friend, family member, financial advisor, or therapist. 

All of them can support you both during the money talk and afterward. 

With some ground rules in place, they can help ensure everyone's point of view is shared. 

And if things get tense, having a third person there may act as a buffer to prevent things from escalating too far.

If you're uncomfortable with someone in your family or social circle, consider a financial therapist or a certified financial planner who has experience mediating these kinds of conversations and can help keep the conversation productive without letting it spiral into an argument.

TIP: It is a good idea to try to have this difficult personal finance discussion in person and not over the phone.

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2) Listen as much as you talk

One of the best ways to open these conversations is to ask the other person what they want and need instead of just telling them what you think. 

You're not the only person in this conversation, and you can't put all of your needs first. 

You want to get what they need, too, so it's best that everyone has a chance to speak their mind without feeling judged or attacked for their stance or for the amount of money involved.

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Open-ended questions like the ones below are a great way to work through financial decisions with an open mind. 

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Ask them about things like: 

• What are their goals for the future and how do they feel about their current financial situation? 
• What are some things that would make them happier in life right now? 
• What are their ideas regarding a specific plan moving forward?

Once you’ve discovered their goals, ideals, and plans then tell them more about your own goals, ideals outcomes, and plans on this topic. 

If you don't have a plan for your money issues, then the next steps are to be honest about that with the other person and discuss what it would take to come up with one together. 

It might not seem like such a big deal at first but without a game plan or some agreements in place, things can get messy fast!

TIP: Take some time to think about things ahead of time and clearly outline what you’d like to happen in the conversation, what your financial goals are in the conversation and with in the future, and what a plan moving forward might look like. It can be helpful to through what enough money means to you. 

3) Listen without judgment

Remember that in a long-term relationship, the other person's feelings are just as important as yours in these conversations. 

Everyone has a story and a unique reason for doing what they do. May be hard to see your partner's good intentions for the way they are approaching money. 

They deserve to feel like they're being heard without feeling attacked or judged.

This doesn't mean that you can't share your own feelings about the situation, too. 

One of the most essential skills in a productive conversation is to acknowledge the other person. 

Acknowledge what they say and how they feel, even if you disagree will help you get through tough money conversations. My experience has been that until people feel heard and understood for their position and perspective they have a hard time hearing a different perspective. 

Acknowledgment doesn’t mean agreeing, it simply means that you’re assuring the other person that they’re being heard. 

TIP: Rephrasing what you’ve heard the person say and repeating it back to them is a simple and effective way to acknowledge the other person’s thoughts and feelings and let them know you’re listening. 

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4) Be open about your thoughts and feelings 

No one wins in conversations that are guarded and closed. 

In order to foster a safe space with the other person, it’s important to enter into the conversation from a place of authenticity and realness. During these important conversations it is a better idea to try hold mutual respect for each other. 

This might mean sharing with the other person how uncomfortable you are or talking to them about times in your own life where it's been difficult to manage money. 

When you share your personal world with the other person they will often let their guard down and be more honest with you. 

TIP: Vulnerability begets vulnerability. So don’t be afraid to be a bit vulnerable with the person you’re talking to. 

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5) Don't make promises that you can't keep

It’s essential that you’re both able to trust what the other person is saying in these types of constructive conversations. 

Once you’ve established authenticity and allowed yourself to be vulnerable, as we discussed in the last point, it’s important that everything you say is true and honest. With money being a taboo subject for many it is important that active listening is used to clarify what each of you is committing to for your financial decisions.

Be honest with the other person. Whether that’s about your capacity to pay their bills or loan them money or about how much debt you have and what you’re struggling with financially. 

Part of fostering great communication with another person is the willingness to be honest. 

If you’re willing to take on some of their responsibilities, also be clear and honest about exactly how much time you’re willing to dedicate to these tasks.

Another part of great communication and honesty is the ability to set boundaries. 

You can’t honestly say “yes I’ll do that for you” unless you set a container around what doing that thing means exactly. 

For example, perhaps you’re willing to help them find some good investments for retirement. However, you’re only able to dedicate about 4 hours to do this and then you will have to have them speak to a financial advisor. 

That’s perfectly okay if you communicate that ahead of time. However, if you tell the person that you’ll “figure out their retirement investment plan for you” then they’ll expect you to keep going until the investments are made. And this may be much more time and energy than you’re willing to put into it. 

Be clear about what you can contribute upfront and don’t be afraid of disappointing others by saying “no” to what you can’t commit to. 

It’s more important to be honest about what you’re willing to do rather than trying to spare their feelings. 

Ironically, sparing someone else’s feelings by not setting boundaries or telling them the truth can often cause mistrust because it’s not honest. 

TIP: Be clear on exactly how much time and money you’re willing to contribute to solving the problem you’re both having. Consider what you’re willing to do upfront but also be willing to hear what the other person needs. Don’t be afraid to take a step back from the conversation and return later if you need time to think about whether or not you can fulfill what they’re asking for. 

6) Cultivate financial empathy

Not everyone’s financial situation is the same. 

Everyone has a different financial reality. 

So when you're thinking about your financial situation, be sure to consider that the other person’s situation may be far different from your own. 

This will give you an opportunity to try to understand why they're acting the way they are.

It's important for you to understand the other person and their motivations, even if they don't come from a place that you consider logical. 

We all have underlying beliefs and stories about money that motivate us to act differently. 

We all want different things out of life so remember that other people might not see the world in the same way as you do. Be sure to show them empathy for whatever they’re going through. 

These conversations are not just about money. Be prepared for some of them to include discussions of emotions and general well-being as well!

TIP: Be patient with each other, and don't be afraid to ask questions. Try not to get angry when someone doesn't agree or does something that makes sense but is hard for you.

7) Take the Time and Space You Need

First, be sure to ask the other person if they’re up for a conversation about money. When you make this request, be very clear that it’s vitally important, and also be clear about how much time you’ll spend having the conversation. 

“I need to talk about our retirement. This is important to me. Can we set aside 45 minutes to discuss this on Sunday afternoon?”

Second, respect that you can't force someone into doing or thinking about something they don't want to do without considering their feelings.

If the other person pushes back against having the conversation, listen to their concerns and feelings. Then, reiterate its importance to you and ask them for a day and time that would work. 

Third, take breaks whenever you need them during the conversation. If you both feel emotionally overwhelmed, come back when you are better able to discuss this topic again.

Fourth, be prepared ahead of time. Write down your questions before the conversation and what needs to be discussed to keep you focused. 

TIP: Write down how they responded to each question you have so that you can accurately remember what happened later. 

8) Use good communication strategies

Good communication strategies can be beneficial for tough conversations about money where your trying to find common ground.

One of the best strategies is not blaming the other person and using "I" statements. 

When people have conversations about difficult topics, like money, they often blame the other person for things being the way they are.

This often involves one person saying, “You spent too much on the credit card” or “You’re always so irresponsible.” 

Instead of blaming, try turning the tables and talking about how these things have impacted you. 

Say, “I’m uncomfortable and afraid of the amount of credit card debt we’re carrying,” or “when you spend a lot, I get afraid for our financial future”. 

This way you share what’s true for you instead of blaming the other person. 

You’re also creating financial intimacy with the other person because you’re talking about your honest thoughts and feelings instead of just throwing stones. Want more guidance on how to foster financial intimacy, then? The Couples Guide to Financial Intimacy is for the two of you.

Would you like more 1 on 1 professional support? Then Therapy-Informed Financial Planning is for the two of you. I invite you to schedule your free 30-minute discovery call today.

Wishing You Healthy Love and Money,

Ed Coambs

MBA, MA, MS, CFP®, CFT-I™, LMFT

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