How to talk with family about money

Jason E. Siperstein

In a survey of 1,200 Americans, the Capital Group, an investment manager, found that people are more comfortable talking about marital problems, mental illness, drug addiction, race, sex, politics and religion than they are about money.

But money and household finances are among the most important topics that families and couples should be discussing, especially during periods of economic stress. Open, honest conversations about finances can produce a range of benefits for the people involved, including reducing stress and anxiety, and aligning couples and families around common goals, which in turn better positions them to fulfill those goals.

Here are some suggestions for starting and sustaining a healthy dialogue about financial issues:

• Air your aspirations. What do you and your spouse or partner aspire to do with your lives and your money? What goals do you have for the near, middle and long term? How do you envision your lifestyle now and later in life? These kinds of questions can help frame the discussion. Once you’ve made a list of your goals, prioritize them. Be sure each person has an opportunity to explain their goals and priorities, and to ask questions of each other in a non-judgmental, non-threatening way. This helps to establish common ground.
• Take it seriously, but make it non-threatening. Try to make the discussion fun. Maybe have a nice glass of wine to get started.
• Wade in gradually. Don’t feel the need to solve everything all at once. Choose a few topics to focus on first.
• Practice. The more frequently a couple discusses money, the more comfortable they are likely to become with those conversations. Always remember to schedule the next “money talk” before concluding a discussion.
• If the conversation takes a turn for the worse, mutually agree to table it. Don’t be afraid to call a meeting early. Talking about money can get heated, and it is important to make this exercise enjoyable and repeatable.
• Share resources. To develop common ground and a common language around money, start using the same household finance apps (like Mint, for example). Share books, podcasts and other sources of knowledge about household finance, investing, etc. Then discuss some of the key things you have learned from these resources.
• If you have kids, get them thinking about money, too. Talking about simple money issues with even young children lays the groundwork for healthy, transparent discussions throughout life. Eventually, those discussions should include issues such as wealth transfer, end-of-life considerations and other weighty intergenerational topics. These issues are likely to be easier to discuss if parents and children already feel comfortable talking about money. Here again, it’s important to carve out time in advance to have these discussions. Invite everyone to bring questions and refer to all the items above to frame the discussions.
• Enlist the help of a knowledgeable, objective financial professional for expertise and guidance, and as a sounding board and a neutral third party. For their financial know-how, perspective and experience, and their ability to help sort through issues you can’t resolve and to answer questions, a financial professional is an invaluable resource. To find a Certified Financial Planner in your area, check out www.PlannerSearch.org.

 JASON E. SIPERSTEIN, CFA, CFP, is the president of the Financial Planning Association of Rhode Island and president of Eliot Rose Wealth Management.