Friendship and Money: The Layers of Talking Money with Friends | EP61

Friendship IRL Podcast - Episode 61 - The Layers of Talking About Money With Friends With Financial Coach Sarah Roller

Mixing friendship and money can be a tricky subject to broach, but I firmly believe that having open conversations about money with friends can be incredibly beneficial. There are various layers to discussing money with friends, and it doesn’t always have to involve divulging specific numbers. It’s common to shy away from financial conversations due to fear of judgment, comparison, potential tensions, or emotions that may arise. However, by utilizing the different layers of money conversations outlined below, you can gradually ease into discussing finances and financial goals with your friends.

Supporting your friends through financial challenges, helping them achieve their money goals, and being a part of their personal finance journey can deepen your connection with them in a meaningful way. This article aims to provide practical advice on how to have constructive discussions with friends about financial realities, money aspirations, and financial literacy. Opening up about money with friends also allows for a better understanding of each other’s life choices, setting financial expectations within your friend group, and offering support in making necessary financial trade-offs. By incorporating proactive communication strategies, making thoughtful compromises, and adopting a non-judgmental perspective on money matters, you can infuse your friendships with empathy and understanding when the topic of finances arises.

About the Guest : Sarah Roller

Today’s guest is Sarah Roller, a financial coach who helps women and new parents proactively manage their money. Her personalized plans allow clients to enjoy life now while also working towards their future goals.

Sarah’s business was born from candid conversations with a coworker turned friend about their pay and approaches to money. Even though these conversations were vulnerable, they were eye-opening. She quickly saw that they had different approaches to money, and over time, they created a judgment-free space to dig into their previously unspoken financial questions.

Sarah now brings this same openness and understanding to her financial coaching practice. She knows money remains an uncomfortable subject for many and strives to create a safe space for clients.

Be sure to check out Sarah’s free download, Unexpected Expenses Spreadsheet, to ensure an unexpected expense never derails your budget. While you’re over on her side of the internet, check out her articles and financial tips.

Understanding Friendship and Money

There are numerous reasons why people tend to avoid discussing money with friends, deeming it a taboo subject. However, there is great potential in having open and productive conversations about money with friends to help each other reach financial goals.

Although discussing money with friends can sometimes lead to feelings of shame or frustration due to differing financial situations, it is important to remember that everyone has unique life visions and financial priorities. By openly discussing how money is being used as a tool to achieve these goals, friends can better understand and support each other.

Approaching conversations about money with an open and curious mindset can lead to a deeper understanding of friends’ goals, choices, and life transitions. When done thoughtfully, discussing money with friends can strengthen relationships and bring individuals closer together.

I have seen firsthand how powerful it can be to mix friendship and money at whatever layer you choose. What are the layers, you ask? Let’s dive into the layers of talking money with friends.

The Layers of Talking Money With Friends

When it comes to opening up about finances with friends, it can initially feel uncomfortable and expose a sense of vulnerability. However, it’s important to remember that you don’t have to dive into sharing specific dollar amounts or account balances immediately. Take your time and ease into the conversation at a pace that feels comfortable for you. Start by discussing general financial topics or sharing your personal experiences with money management. As trust and comfort levels grow, you can gradually delve deeper into more detailed financial discussions. Remember, the key is communicating openly and honestly while respecting each other’s boundaries and privacy.

Layer 1: Acknowledging that Money is On Your Mind

Simply stating that you’ve been thinking more about money lately or that finances have been on your mind opens the door. It signals to friends that you’re receptive to having financial conversations without divulging specifics.

Layer 2: Discussing Financial Resources

Next, you can discuss financial resources you’ve consulted or found interesting, like budgeting apps, credit card point strategies, retirement calculators, etc. Ask friends why particular resources work well for them to uncover motivations and constraints.

Layer 3: Sharing Money Goals

Tell your friends about the financial goals you’re currently working towards, such as saving for a down payment, paying off debt, or building up a travel fund. Sharing your money goals with your friends can help them understand the reasons behind your decisions that may affect your social life, such as skipping a group trip, cutting back on weekend outings, or reducing your monthly expenses. This open communication can prevent misunderstandings and strengthen your friendships by creating a supportive environment where everyone is aware of each other’s financial priorities.

Layer 4: Diving into Money Mechanics

Dive into the types of financial accounts being utilized, bill negotiation tactics, salary vs benefits tradeoffs, and other structural elements without naming dollar figures. Discover new options and accountability.

Layer 5: Talking Numbers

With close friends, you may choose to disclose certain numbers such as salaries, spending habits, net worth, and retirement plans. However, it’s important to remember that numbers only provide a partial picture – for example, knowing someone’s salary doesn’t reveal their monthly cash flow. Instead of just focusing on numbers, consider delving deeper into how these figures make them feel, how they align with their goals, and other meaningful conversations that foster openness and curiosity in a supportive way.

Remember – You don’t have to talk about money with any friends. Or you might open up to level one or two with a friend. You might talk more in-depth about money with a defined friend and never talk openly with a close, present friend. That says nothing about your friendships. Always discuss money at a level that feels comfortable to you.

However, I would encourage you to work towards talking about money with some friendship, as it can be incredibly beneficial. Not only does it help you connect with others, but it can also accelerate your financial progress when you are working together with friends to achieve your goals. Don’t feel pressured to reach a certain level of money talk with every friend, as each relationship is unique. Just focus on finding those individuals who are on the same page as you when it comes to financial discussions.

Navigating Wealth Disparities and Friendships

When talking about finances with friends, it’s important to remember everyone perceives money differently based on their background and experiences. The same dollar amounts can elicit pride, shame, or neutrality, depending on the individual.

For example, one friend may feel overwhelmed by $5,000 in credit card debt, whereas another sees $5,000 as a small debt they aren’t concerned about. Though the number is the same, the emotions and contexts differ greatly.

Friends may also have vastly different money goals at the same life stage:

  • Your friend saving for a down payment through extra freelancing gigs may need to postpone dinners out, while you put spare money toward travel.

  • A friend focused on accelerating retirement savings could have a very different view on buying a second home for vacations compared to you.

  • Someone building a business on the side has distinct cash flow needs from someone focused on paying off student loans.

When these money goal differences surface through changes in behavior or spending, it’s important not to take it personally. Accept and respect that season of their financial journey rather than judging against your own goals.

When friends set new financial goals, it may require them to make adjustments in how they participate in your friendships. This could mean passing on activities they used to readily agree to, such as expensive dinners or weekend getaways. When discussing money with friends, it’s important to communicate about compromises and explore shared experience roots that respect both friends’ financial limitations.

Planning Budget-Conscious Activities

When your friend group includes both big spenders and budget-conscious folks, coordinating hangouts can get tricky. No one wants to constantly be the one to suggest cheaper activities or hold back extravagant friends. And budget-focused friends don’t want pity invites or only to be included as an afterthought.

Here are some tips to smoothly navigate event planning across different financial situations:

  • Use apps to split uneven expenses rather than always defaulting to splitting evenly. Removes bill anxiety for those watching costs. (My favorites are Splitwise and Plates)

  • Rotate who suggests outings so that there are always various options for different preferences and budget constraints instead of always deferring to the friends with the biggest budgets

  • When you are the one suggesting friend hangouts, remain conscious of price points based on their habits, not your own wallet. Plan some hangouts specifically to embrace budget-friendly favorites together rather than highlight financial differences. Potlucks, picnics in the park, window shopping date, board game night etc.

  • Give a heads-up to your friends when you have a new financial goal that will change your spending habits. If you have to back out due to costs, don’t just say no. Explain why you have to pass this time. Friends will understand life stages and individual priorities.

Most importantly, always lead with a positive and proactive attitude about money. Make sure to communicate your financial goals with your friends and be respectful of their goals as well. Encourage accountability within the group to ensure that everyone feels included and valued. By working together towards common financial objectives, you can enjoy fun activities without breaking the bank.

Being Friend’s Financial Support Systems

Money challenges and successes profoundly impact our lives. Yet most keep them private without trusted spaces to share freely. Friends who are working on their financial wellness can become invaluable support systems for one another.

Whether working toward massive goals like early retirement or just trying to pay off nagging credit card debt, we all experience financial highs and lows. Friends who open up break down barriers and build compassion. Judgment gets replaced by encouragement.

Support shows up in many empowering ways:

  • Listening without assumptions when rarely discussed money stress gets shared

  • Offering accountability through gentle check-ins on progress toward savings goals

  • Providing helpful perspective when friends obsess over income comparisons

  • Celebrating wholeheartedly when financial milestones get achieved after years of effort

  • Asking thoughtful questions to understand behind the scenes of major decisions

  • Exploring various strategies attempted rather than prescribing opinions

  • Being vulnerably honest about similar struggles and lessons learned

Next time finances feel bewildering, don’t forget friends can offer just the right dose of reassurance, reality checks, and revelry to push through. Give and gain strength as financial support systems together.

Is money causing problems in your friendships? Disagreements might flare up around directly splitting expenses, not returning small debts, pressuring friends towards financial decisions, frequently cancelling due to money reasons, or perceived judgement on how one handles their finances.

When money conflict arises with friends, address it by:

  • Step back from heated moments to give yourself time to cool down. Instead of fixating on the immediate issue, try to understand the underlying reasons for the conflict. Stay curious and focus on the “why” to navigate money-related disputes effectively.

  • Listening fully to understand all perspectives without getting defensive

  • Recognize that discussions about money can be sensitive and be willing to apologize for any mistakes on your part

  • Be open about your budget constraints or changes in financial goals that may affect your social activities with friends.

  • Express gratitude for your friends’ understanding, flexibility, and support as you navigate these money-related challenges together.

  • Collaborate on finding compromises that respect each other’s differences while preserving the friendship.

Effective communication, empathy, self-reflection, and creativity are key in resolving money-related conflicts with friends. Addressing the issue’s root within the relationship makes it possible to strengthen the bond and move past the disagreement. It’s important to remember that financial situations can change over time, impacting friendships, so maintaining open dialogue about tensions is crucial to preserving the connection. By approaching money conflicts with understanding and a willingness to work through them together, friendships can endure life’s fluctuations and grow stronger.

10 Strategies for Financial Harmony with Friends

Maintaining financial harmony with friends can be challenging, but by establishing clear boundaries and communication, you can navigate these relationships with ease. Here are 10 strategies to help you achieve financial harmony with your friends.

  1. Openly discuss money priorities to understand individual contexts behind decisions.

  2. Share money wins and stresses from a place of vulnerability

    Set group expectations upfront for how hangout expenses will be split
  3. Rotate picking cheaper/pricier activities based on different budgets
  4. Explain specific tradeoffs when turning down invites rather than just saying no
  5. Ask questions to learn the motivations behind financial choices before judging
  6. Celebrate milestones and progress friends make toward money goals
  7. Consider others’ financial comfort before pushing expensive ideas
  8. Occasionally check in on accountability toward mutual savings goals
  9. Welcome perspective from friends if you seem fixated on financial comparisons

What other strategies for navigating friendship and money would you include? Leave a comment below!

Final Remarks

While money isn’t always the easiest topic to navigate with friends, it can be incredibly powerful. Always prioritize conversations with curiosity and seek open-minded understanding. Be proud of your friend’s successes, provide reassurance during times of financial uncertainty, and cheer for each other on the journey towards your individual money goals.

Frequently Asked Questions

What are some common challenges when it comes to friendships and money?

Typical money-related friendship challenges include reluctance to discuss financial constraints openly, making assumptions about friends’ financial situations, pressuring each other towards expensive activities, and judging financial decisions differently than one’s own. These can breed resentment, confusion, isolation, and even feelings that the friendship is threatened when unaddressed.

How can one maintain a healthy balance between friendship and finances?

It takes proactive, empathetic communication about financial priorities and tradeoffs to balance friendship with varying personal finance needs among friends. Set expectations about activity spending upfront, explain your money goals early when declining invites, ask clarifying questions before critiquing money moves, and share pride in each other’s progress to maintain compassion.

Is it possible to preserve friendships amidst significant wealth differences?

Yes! As long as both friends are focused on supporting each other’s money goals, planning budget-conscious activities, and staying supportive as any friends work to change their money landscape.

How should one approach resolving conflicts arising from money issues in a friendship?

Absolutely – share activities equitably based on different comfort levels utilizing bill-splitting tools, rotate picking pricier/cheaper hangouts, remain conscious of what’s financially feasible for others when suggesting ideas, and talk through money decisions vulnerably without judgment. Mutual understanding preserves connection when friends have different financial situations.

Profile Photo for Alex Alexander a blonde haired white woman smiling at the camera. She is in her 30s with her hair down and curled and wearing a grey sweater.

Hi! I'm Alex.

I am just a person who has spent an extraordinary amount of time trying to understand some of the relationships that I hold most dear. I invite you to join in on the conversation below in the comments section below.

Ask questions, leave comments, share critiques or give advice. All are welcome.

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Hi. I'm Alex.

I'm just a gal who cares deeply about community + friendship. Why? Well, I didn't have a healthy support system growing up.

So I built one... out of friends. I believe a healthy support system is the ultimate self-care.

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