Managing money and relationships
Talking about money with people you really care about can sometimes be a delicate subject. In the worst cases, it can lead to disagreements and resentment if you’re not on the same page regarding your financial circumstances. That’s where learning to have healthy conversations with loved ones is crucial to managing both your personal and financial well-being.
The five-step approach
This approach is one way to structure your conversations. Think of it as a set of ground rules to keep the discussion moving to the most sincere and positive outcome. Let’s go step by step:
Step 1: Lay the foundation
Consider the atmosphere before starting the conversation. Don’t do it after a fight, for instance. At this stage, you should keep things relaxed and not related to a specific issue. Try conversation starters like “I’ve been reading this Learning Hub series and it’s really interesting” or “I learned about this cool concept called “purpose of money.”
Prioritize this conversation at a time and place that’s quiet, private and without distractions. Think of scheduling it as a date where you can bring up money more easily and improve the chances of having a productive discussion.
Step 2: Determine what you want
The goal is to create a connection and listen to what the other person is saying. This can be challenging when there are emotions to consider, but it’s important you approach the conversation as an ally – not an opponent.
A good rule of thumb is to ask “What” not “Why.” Instead of “Why are you so stressed?”, ask “What’s this about for you?” That could bring focus to the bigger picture, like job security or retirement plans. Listen to what the other person is saying and validate it. This sets the tone for them to do the same.
Step 3: Develop the plan
Contribute towards a solution. This should be a joint exercise, with both people brainstorming and contributing ideas. Chances are the conversation will lead to something deeper than just spending too much. Sometimes tension isn’t actually about money. It might revolve around larger themes like power and control, or something smaller like forgetting to take out the trash.
Try to find common alignment on your values. Both of you can answer the question “What is money for?” Find out where you’re on the same page, where you’re not, and empathize with the fact that your answers might differ. Do your best to be honest and transparent about your values and goals around money.
Step 4: Take action
Set expectations! Make a commitment to do something concrete. For example, you could agree to discuss before you spend $100, but set aside $50 per week for fun money. This builds a concrete plan between the two of you and provides a common goal to work towards.
Make sure to set SMART goals together, and you might find that taking action on them strengthens your relationship – a win-win.
Step 5: Stay engaged
Have regular check-ins to see what’s working and what you can improve on. The key is to maintain momentum and keep building that trust (even if it takes a lot of practice). Make it clear that you’re in it together.
Key takeaways: how to try to improve your relationships
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When you think about your relationships, which ones would be improved if you had an easier time talking about money?
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If a particular relationship comes to mind, give the five-step approach a try.
Words of encouragement: don’t avoid the money conflict
Conflict is part of every relationship, and it’s best to address it when it first starts. A lot of people would describe themselves as conflict averse. They may think it’s better to just avoid the conflict, but it’s not. The more you address the topic of money, the better you’ll get at resolving issues around it.