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Financial wellbeing

How to have difficult conversations about money


Dee O'Callaghan, Financial Coach - Financial Wellbeing Collective

08 Dec 2022 • 5 mins
couple researching

Money can be a sensitive topic – we often don’t like to talk about money as it can make us feel vulnerable or judged. Relationships with money differ from person to person, our upbringing, personal situations and career are just a number of factors that impact how we feel about finances. These varying relationships with money can lead to friction in personal relationships, particularly when it comes to spending.

For example, Rachel is invited out to dinner with her friends next Saturday. She’s already starting to feel anxious about it as her friends typically spend a lot of money on expensive drinks when they go out and then split the bill equally. Rachel can’t afford these drinks but still has to help foot the bill for her friends’ expensive taste. 

So how do we speak with friends and family about this touchy subject without causing tension?

1. Prepare your speaking points.

These conversations can be nerve-wrecking, to ensure you stay on topic and get everything off your chest it’s helpful to prepare speaking points. This means if the conversation does get heated or your nerves get the better of you, you still have your points to make sure you explain your point of view as clearly as possible.

Prior to Rachel calling her friend Sara, she writes down the three main points she wants to explain. They are:

- Although she loves going to these dinners, she’s beginning to find them stressful as they’re expensive.

- She doesn’t drink the expensive drinks her friends order which can often double the cost of the bill.

- She would like to only pay for what she orders instead of splitting everything equally as it’s not in her budget.

2. Start the conversation

Starting the conversation about money can be the most difficult step. We tend to stress about situations before they even happen, but you may find it goes better than you anticipated. Think about how you’ll feel if you don’t have the conversation, what will feel worse?

Rachel is nervous to pick up the phone and make the call. But she thinks she’ll feel better getting this off her chest. What would happen if she doesn’t? She’ll either continue to go out to these dinners and go over budget, which will lead to stress and resenting her friends. Or she’ll stop going to these dinners without explanation which would confuse and hurt her friends’ feelings. She decides having the conversation is the best option for her.

3. Remain calm and actively listen

When you have said your piece, leave space for the other person to respond. Listen to them carefully to understand their thoughts and feelings. Try to remain calm, you can’t control people’s reactions. You can only control what you say and how you say it. 

If they disagree with you, ask them why? If they make a good point, acknowledge it. The aim of these conversations is that both parties find a resolution to the problem.

Prepare what you may be willing to compromise on, at the end of the day you’re looking for a win-win situation. If you prepare for the likely counterargument, it will put you in a better position to find a solution for both parties.

After Rachel has explained how she is feeling, she remains quiet until her friend Sara has responded. At first, Sara is surprised and a little hurt. But after Rachel asks why she feels that way, it becomes clear it’s because she had no idea how Rachel was feeling. Rachel explains it’s been difficult to bring up this topic as she tends to avoid confrontation. Sara understands and is happy to make these changes so Rachel can stay within her budget.

End it well

After the conversation, acknowledging that you had a difficult chat is a helpful step for both of you to move on. Highlight the positive outcome and how the conversation was beneficial to you. This allows both parties to close the chapter on this event and move forward with the relationship.

At the end of the call Rachel says she’s glad she’s had this discussion; she was nervous about it but already feels a lot better. Sara agrees and says she’s happy to know how Rachel is feeling and just wants her to enjoy the time she spends with the friend group. Now they can continue to look forward to the dinner on Saturday.


Want to strengthen your money management skills?

Did you know, Keystart also offers a free financial coaching program with the Financial Counselling Network. Eligible customers can access free one-on-one coaching sessions to help improve your money management skills.

Financial coaching service with Keystart

Keystart recommends that you seek your own independent financial advice prior to making any decisions about your financial needs. Any examples given in this post are provided for illustrative purposes only.