My Financial Communication Sucks: 4 Steps to improve your conversations about money
We are taught from a very young age to never talk about money. A cross-cultural phenomenon, it’s considered crass, rude, and unkind to discuss finances openly. And that protection of financial conversations makes sense if you are in a public group of strangers. However, even within our own families — the people from whom we should be learning how to have these discussions — the financial conversations are surface-level at best.
It is no wonder, then, that when we are often ill-equipped to have financial conversations when we enter into long-term relationships and marriages. Here are 4 steps to help improve your financial communication in your marriage or long-term relationship.
Take stock of the lessons you carry from childhood about money.
We carry within us lessons about money that we received from watching our parents, school friends, and various media that we consumed as children. It is important to identify what lessons you carry within yourself about money and categorize them into tow groups: Group A — Good ideas that you agree with and want to keep; Group B — Unhealthy ideas that you carry and need to edit.
Identify where you are along the YOLO/Carpe Diem ←→Frugal MacDoogal Spectrum.
Every person tends to have more of a ‘seize the day’ or a more financially frightened relationship with money — and these different people frequently end up married to each other! It is important to know where you are on the spectrum so you can appreciate the strengths and liabilities that each perspective brings to the relationship (for a deeper dive on that, click here for YOLO/Carpe Diem and here for Frugal MacDoogal)
Take Stock of CURRENT Financial State of Relationship.
The “Financially Anxious” heart is soothed by data. At times we argue about money based upon anxieties without having the data at hand to understand the problem concretely. This can be horrible for starting good, productive conversations about how to move forward. To understand where you are going, you must know where you are beginning. Taking stock of the current financial state of your relationship can include doing a Prospective Annual Budget to ascertain the flow of money annually throughout the household, taking stock of any debts, and looking at what the concrete income (post-taxes) is in the household.
Be Specific with Financial Hopes of Relationship.
It’s all too easy to state that the aspiration is to “just make more money” to help with the financial status of the relationship. But this way of thinking can backfire because it feels never-ending and nebulous. Getting very specific with the goals can help. After looking at the flow of money annually (see step #3), you can then say, for example, “We need to make $35,000 post-tax more per year to pay off all our debt”. This number is much more concrete and then can be broken down into a monthly amount, which then can be brainstormed together about how to make that additional income. Without specificity, goals are always going to be out of reach. Specificity makes the goal real, visible, and ultimately tangible.
Improving Financial Communication can feel like a daunting task, but it does not have to be. If you — or someone you know — needs help having these conversations, reach out! If I am not a good it, I will help you find someone who is!
Click Here to Schedule a Session
Or you can email me a question here: DrZepeda@FinancialTherapyTexas.com