Broke Millennial Talks Money

1. Money conversations are crucial for all relationships

"Speech is silver. Silence is golden," says Dickinson. "People hate silence. We call it awkward. We try to fill it. There is hardly a moment of your day without sound."

Breaking the silence. Discussing money is often uncomfortable, but it's essential for healthy relationships. Whether with coworkers, friends, family, or romantic partners, open financial communication can prevent misunderstandings and strengthen bonds. To initiate these conversations:

• Start with "I" statements to express your concerns
• Use the "over/under" method to discuss salaries
• Practice negotiation skills in everyday situations
• Set clear financial boundaries and expectations

Remember, avoiding money talks can lead to resentment and missed opportunities. Embrace the awkwardness and reap the benefits of financial transparency.

2. Sharing financial information with friends requires careful consideration

"There are so many ways we talk about money without actually talking about money," says Lindsey Stanberry.

Context is key. When deciding whether to share financial details with friends, consider the potential impact on your relationship. Sharing can be helpful if:

• It provides motivation for debt payoff or savings goals
• It helps a friend negotiate a better salary
• It creates accountability for financial goals

However, be cautious about:

• Creating feelings of jealousy or inadequacy
• Inviting unwanted judgment about spending habits
• Altering the dynamics of your friendship

Instead of sharing exact numbers, consider discussing percentages or general financial strategies. Always frame the conversation in terms of mutual support and growth.

3. Navigate income disparities in friendships with open communication

"I try to be cognizant of the income disparity and not be a dick about it," jokes de Leon.

Empathy and understanding. Income differences among friends can create tension, but they don't have to ruin relationships. To maintain friendships across income levels:

• Be honest about your financial limitations
• Suggest budget-friendly activities
• Offer to pay occasionally, but don't make it a habit
• Avoid judgment about others' spending or saving habits

Remember that financial situations can change over time. Focus on the value of the friendship rather than material differences. Open communication about financial comfort zones can help preserve relationships and prevent resentment.

4. Set financial boundaries and learn to say no to social obligations

"You have to weigh which will win out: the embarrassment or the resentment. Is it going to be more embarrassing to own up to your financial situation or will you be resentful for three days because you said yes when you really can't afford it?"

Prioritize financial health. Learning to say no to social obligations that strain your budget is crucial for long-term financial well-being. Strategies for setting boundaries include:

• Using the counteroffer technique
• Sharing your financial goals to provide context
• Suggesting alternative, budget-friendly activities
• Being honest about your limitations

Create a "friend fund" to budget for social activities without compromising your financial goals. Remember that true friends will understand and respect your financial boundaries.

5. Discuss long-term care and estate planning with aging parents

"The biggest mistake people make is assuming this conversation doesn't need to happen until it has to happen," says Cameron Huddleston.

Plan ahead. Initiating conversations about estate planning and long-term care with aging parents can be challenging but is essential. Key points to discuss include:

• Wills and beneficiary designations
• Power of attorney and healthcare proxy
• Long-term care insurance options
• Location of important documents

Approach the conversation with empathy and focus on your parents' wishes. Frame it as a way to ensure their desires are respected and to alleviate potential future stress for the family. Start these discussions early to allow time for thoughtful planning and decision-making.

6. Merge finances thoughtfully when entering marriage

"Everyone has a prenup, it's just the default laws of your state," my attorney told me at the beginning of the prenup process.

Strategic financial union. Merging finances in marriage requires careful consideration and open communication. Options for managing money as a couple include:

• Completely joint finances
• Separate accounts with shared expenses
• Hybrid models with joint and individual accounts

Discuss:

• Individual and shared financial goals
• Debt management strategies
• Investment philosophies
• Budgeting approaches

Consider a prenuptial agreement to protect individual assets and clarify financial expectations. Regular "money dates" can help maintain financial transparency and alignment throughout the marriage.

7. Resolve money conflicts by understanding each other's financial scripts

"It's shocking that most couples never have that conversation and have no clue, really, what it was like for their partner growing up and the mindset they're bringing into the relationship," says Klontz.

Emotional money roots. Understanding your partner's "money scripts" – unconscious beliefs about money rooted in childhood experiences – can help resolve financial conflicts. Common money scripts include:

• Money avoidance
• Money worship
• Money status
• Money vigilance

To uncover these scripts, discuss:

• Childhood experiences with money
• Family attitudes towards wealth and poverty
• Biggest financial fears and goals

Use this understanding to approach conflicts with empathy and find compromises that respect both partners' financial values and concerns.

8. Adapt financial strategies for major life changes

"You can't just dive feet first because you could screw your relationship up," says de Leon. "I feel like finances are something you could rebuild, but the relationship is important. You can't put a price on that."

Flexibility is key. Major life changes – such as career shifts, having children, or retiring – require adjustments to financial strategies. When facing significant transitions:

• Communicate openly about desires and concerns
• Create simulated budgets to evaluate different scenarios
• Consider both financial and non-financial impacts
• Set clear timelines and benchmarks for reevaluation

Remember that financial decisions in these moments can have long-lasting impacts on both your finances and your relationships. Prioritize open communication and be willing to compromise to find solutions that work for all parties involved.

Last updated: November 19, 2024