You can talk to your friends about politics, religion, and relationships. But when it comes to shooting the breeze about money, there seems to be a shared code of silence. While it can be awkward at first, there’s a lot of value in discussing money with your pals.
So when is a good time to discuss money matters? Here are some tips on when it’s appropriate to talk finances with your buddies:
When To Talk Money With Friends
Sharing Costs. Before you agree to split the cost of a birthday dinner or wedding gift, make sure your friends are all on the same page about the costs. Using a P2P (person to person) payment app such as Venmo to split the costs with friends can help avoid potential awkwardness and uncomfortable hounding.
When You Have To Say “No”. A survey by the AICPA and Ad Council found that 78 percent of millennials modeled their financial habits after their friends. Crystal Hammond of SophisticatedSpender.com believes that your friends can even affect your credit score. So if you’re trying to pay off your student loans or adding more cushion to your savings, expressing this in a straightforward and clear way will help your friends understand why you declined a social invite.
Negotiating Your Salary. If you are negotiating your salary or figuring out an appropriate rate for a freelance job, getting advice from a friend with experience will ensure you get paid competitively. Although it helps if that pal works in a similar field as you, just talking about it with a trusted friend who can offer some personalized pointers can give you a boost in confidence.
When You Shouldn’t Talk Money With Friends
If You’re Feeling “Judgy”. “If you see your friend continuing to make poor financial decisions, don’t criticize,” says 30-year-old Tonya Rapley, a financial blogger at myfabfinance.com. “Offer to be their support system and work with them on achieving their goals.” If your friends can’t afford to go out to dinner or that concert, offering a bit of understanding goes a long way.
To Be Nosey. If you’re curious about how much someone makes or how much they spent on a new toy, don’t ask for the sake of curiosity. Instead, talk about money issues that affect the both of you so you have some common ground to start from.
Offering Unsolicited Advice. There are only a few things more annoying than getting advice you didn’t ask for, let alone unsolicited advice on how to manage your money. If you do this, you’ll likely come across as a know-it-all and your friend won’t listen to you anyway. What’s meant to be a well-intended suggestion could easily come across as proselytizing.
While finances are oftentimes considered a taboo subject, talking about money with friends can help you get better understanding of each other’s values and goals. You are both probably going through similar struggles, and talking through it can open the channels for meaningful chats and a better financial future.