Dear Charlotte,
I see tons of advice about how to talk to your significant other about money, but what about your friends? I’m 24 and single and no one in my social circle talks about money, ever, except to complain about feeling broke. I get anxious about my finances a lot (paying student loans and rent in New York, plus trying to get rid of some credit card debt, etc.) and I’d probably feel better if I had someone to vent to or talk me through it when I’m panicking. I think a lot of people rely on their parents for this, but I’m not very close with mine, and neither of them are very good with money, anyway.
Whenever I’ve tried to bring this up with any of my friends, though, they seem uncomfortable or change the subject and then I just feel worse. I’m thinking of two of my closest friends in particular — one of whom is my roommate — who seem to know a lot more about this stuff than I do. Is there a way to bring it up without it being so awkward? I keep reading all this stuff about how important it is to discuss these things, but I have no idea how.
In my experience, people avoid discussing money with their friends for four reasons: 1) They’re afraid of sounding stupid; 2) They were taught that it’s rude; 3) They suspect they have more money than their peers and don’t want to be resented for it; or conversely, 4) They worry they have less money than their peers and will be pitied. And no one wants to be stupid, rude, resented, or pitied! So instead, they say something meaningless, like, “Ugh, I need to stop spending money,” and you say, “Me too,” and you both leave it there.
Sadly, these concerns are pretty well-founded. The first time I tried to talk to a friend about the salary a potential employer had offered me, she interrupted me mid-sentence: “Oh, it’s okay, you don’t have to say what it is,” she said, cringing and giggling like I was about to show her my toenail fungus. I was terribly embarrassed. We were 22, trying to navigate our first months post-college, and I’d clearly bumbled across some kind of grown-up boundary. I apologized for oversharing and didn’t talk to any friends about my salary again until almost a decade later.
And I’m in good company: According to a survey by Merrill Lynch, 61 percent of women would rather talk about their own death than their finances, and 45 percent say they don’t have a financial role model. A survey by Visa shows that women are more likely to bring up kids, sex, relationship issues, and weight (come on!) with their friends than money.
Ideally, you’ll get to a place where you can talk with friends about hard numbers. Rent, salary, how much you expect for your next bonus — women still shy away from these figures, but communicating about them is the only way we’ll gain a truly accurate portrait of what to push for.
Having conversations about money correlates directly with financial confidence and independence. Research has found that families with high “financial socialization” — open discussions about earning paychecks and paying the bills, with parents modeling said behavior for their kids — tend to produce young adults who make smarter, more educated choices about their own cash flow. This is basic psychology: It’s easy to know, in the abstract, what you should do (spend less, save more, pay off debt, etc.), but it’s much harder to grasp the mundane, day-to-day choices that those goals require (keeping track of your bills, eating noodles instead of steak, re-wearing the same outfits even when you’re bored of your wardrobe and want new things, etc.). Exposure to the latter from family, friends, and peers makes all the difference when you’re trying to do the grunt work of replicating good habits in your own life.
However, if your parents didn’t talk much about money (and it sounds like yours are in that boat), you aren’t doomed. In fact, your eagerness to “catch up” in the financial socialization department shows a self-awareness that most people should be so lucky to have. But until they do, you’ll have to be creative in your approach, as your friends — like many adults, especially women — are hardwired to keep this stuff to themselves.
“Money highlights differences between people, so it’s a constant source of comparison on a deep level,” says Amanda Clayman, an L.A.-based financial therapist. “We are social creatures, and we’re constantly looking for cues and signals that give us information about who we are and where we stand relative to the group we’re in.” Admitting and/or acknowledging financial dissimilarities can be perceived as “dangerous to social cohesion,” as Clayman puts it, because it’s associated with jealousy, resentment, or just plain confusion. “Within our society, we don’t have a lot of language for understanding that dynamic, so we tend to avoid it,” she explains.
To dodge that mess, Clayman recommends that you examine your own objectives before you bring this subject to the floor. It sounds like you’ve done that a little bit already, but try to get more granular — maybe even make a list of goals (pay off your credit card debt, save up for a new sweater, understand retirement savings plans, whatever) that you’d like these conversations to help you accomplish, as cheesy as it sounds. Saying you “just want to talk about money more” is a pretty broad, so it might sound intimidating or downright odd if you announce it out of the blue. And definitely don’t ask, “How did you afford that?” Smaller, more digestible questions are your best foot in the door.
I suggest starting with a compliment: “I’ve noticed you seem really on top of your bills. How do you organize them, and how did you learn?” People are much more willing to talk when you’ve given them some authority and buttered them up. They might deflect your compliment at first (“Oh, hardly!”), but reiterate your genuine curiosity (“No really, I’d love to know”). Make them feel smart and magnanimous, and they will be. And if anyone gets weird or uncomfortable, just say, “Sorry — I’m just trying to be better about money,” and move on. It’s their loss.
Your friends will probably be more than happy to help if you articulate what you need from them specifically. Such as: “Can I just vent about my bills for five minutes?” Or, “Do you ever get stressed about your student loans? What or who helps you when you do?” Or, “Want to come over and watch a movie with me on Friday? I want to hang out with you, but I need to stretch this paycheck through the weekend, so I need to stay in.” Chances are, they’ll love that you asked, and be relieved at your candor — and your frugality. Everyone likes saving money, particularly when they don’t have to initiate it.
The key is finding a small group of people you trust in these matters and whom you want to consult regularly. In my own life, cultivating these relationships has saved me — and helped me earn — thousands of dollars or more over time. But remember: This is an area that makes people nervous. They fear your judgment. You have to coax them out with empathy, curiosity, and the premise that they’re helping you — in other words, honesty. If these are good friends, they’ll value that.