Money is a complex subject that can stir up a lot of intense emotions especially when we’re talking to our loved ones. That’s why sometimes it’s easier to just ignore it, not bring it up, pretend it doesn’t exist. However, this inability to approach the money taboo could actually be costing you money.
In a survey of people living in the North-West of England, Legal & General found that more than half are completely comfortable talking about politics (57%) and religion (55%) with their partner, while only two-fifths say the same when it comes to discussing salaries (43%) and debt (38%).
The inability to discuss money means that financial planning in the home is just not happening and as you know from our How to Teach Kids about Money post budgeting is a vital process. Legal and General found that the ways people deal with money management include:
- Waiting for a problem to occur rather than planning ahead: 45% of people only talk about money when they have an immediate worry.
- Lying rather than admitting the truth: over one in five (23%) have told a white lie to their partner about how much they have in savings – the same number (23%) who have told a white lie about how many ex-partners they have.
- Not thinking about it and hoping for the best: a fifth (22%) say they don’t think about long-term financial planning, as they trust it will all work out.
Capitalism and materialism dominate our society so it’s not hard to see why money issues shape the course of personal relationships as well. In one survey polling 2,000 men and women, money more than sex, children or in-laws – was the most common conflict for couples.
Erich Fromm the social psychologist characterized our society as having an orientation in which greed for money, fame and power have become dominant themes in our lives. Money reflects power struggles, receiving and withholding of affection or desirable things, and can also be viewed as a source of pride and shame.
ITS COSTING MONEY
Keeping money as a taboo subject doesn’t just create conflict in the home it could also be costing you money. In an interview with Forbes Porochista Khakpour, a novelist and journalist discussed how because she didn’t want to talk about money on her first book tour she didn’t even know if it was appropriate for her to ask the publisher for cab money home from the airport.
The Legal & General showed that 41% of people (over 20 million adults) feel stressed about their finances. Showing that this problem affects the daily lives of millions of families up and down the country. Still there are that 41% of people who will only talk about money when they have an immediate worry, 22% of people lying about how much debt they’re in and 11% of people hiding credit card statements from their partner.
All of this means a lack of financial planning causing problems to be tackled too late resulting in short term solutions like payday loans which can end up costing thousands more than the initial problem.
HOW TO STOP
It’s the age old adage “Communication is key” but it’s hard to know how to broach the subject so here are some ways to get started:
Spending vs. Saving: Often there can be conflict when one-half of a couple is a spender whilst the other likes to save. So when it comes to buying learn to compromise; combine the saver’s ability to sniff out a good deal with the spender’s ability to commit to a purchase.
Single-Income Household: If one member of the partnership is feeling controlled by the other financially then start by broaching the subject at a calm time, not when you’re arguing about money, and explain your feelings. One technique that can help is setting a specific dollar amount for each partner’s discretionary spending or agreeing that you’ll discuss any purchase over a certain limit before making it.
Spending Priorities for the Kids: Talk about the real issues. For example, maybe you went to private school and think that will set your kids up for a successful future, while your partner went to public school and thinks that will make your kids more self-sufficient. Either way, just explaining the emotions underlying each of your beliefs will help you find common ground.
Debt: Don’t ignore it. Tackle it. Get aggressive and take care of it once and for all. Either way, schedule a time to sit down, crunch the numbers (how much debt you have, what kind it is, how much savings you have, how much each of you earns), and decide what’s realistic.