It’s taboo. That’s not polite. It’s personal. These are all things you’ve probably heard when it comes to money. It’s common to stay quiet about personal finances, but not talking openly about your financial plans can put your financial future at risk.
Unsurprisingly, it is reported that “only 9 percent of baby boomers frequently discuss money issues with those close to them.” transamerica. and, investigation According to a Wells Fargo survey, 44 percent of Americans believe that personal finance is the most difficult topic to discuss with others, ahead of topics such as death, politics, and religion.
However, avoiding talking openly about your finances can jeopardize your prospects for a safe and happy future.
Here are 10 reasons why talking about money is helpful, and some tips to start the conversation.
1. Talking openly with friends and family will increase your (and their) success
Peer pressure doesn’t end at junior high school. We feel pressure as parents, at work, and sometimes even when to retire and what to do after retirement.
However, peer pressure isn’t necessarily a bad thing. Peer pressure can also encourage you to develop better habits and make better decisions.
- Research shows that people who have friends with high financial intelligence are more financially intelligent themselves.
- And just as you’re more likely to exercise if your peer group is exercising, you’re more likely to save for a secure retirement if your friends are also saving. It will be expensive.
Personal finance is a big issue. By talking about it with friends and family, you can bring this topic to the forefront and help yourself and your loved ones. Too often, financial and retirement planning is done in secret or not at all. However, talking about it openly can make the problem more visible.
By talking about retirement, you can find new ideas for achieving financial success and ultimately feel more prepared.
2. Be able to avoid and solve problems
Common Cents Lab said: scientific american“In our interviews, we frequently encounter people who have accumulated crippling debt, missed savings opportunities, or are unaware of basic financial strategies to improve their well-being. I was embarrassed to ask friends and family for advice about money.”
Talking to people about your financial situation can help you solve financial problems.
3. Conversations about money reduce stress.
Think about what you would do when faced with a problem that is difficult to solve. You’ll probably talk to colleagues, friends, and family. Such a shift can elicit empathy, understanding, good solutions, and, in most cases, a more optimistic outlook.
The same thing happens with conversations about money. You’ll find out you’re not the only one struggling, and you might find some ideas to help you solve your problem.
4. Talking about money can give you valuable insight and advice.
When it comes to other areas of your life, such as work, relationships, and lifestyle choices, your friends and family may be the first people you turn to for advice and comfort. Why does financial advice vary so much? If you don’t reach out to people you know about your retirement finances, you could be missing out on important advice.
Your acquaintance may or may not have all the answers, but sometimes just talking can clarify your plans and give you a new perspective.
5. You’re more likely to follow through with your plans
Talking to friends and family about your financial goals increases your chances of success. It adds a layer of accountability to your plan.
a study showed that the number of deposits made by people who had the option to announce their savings goals publicly increased by an astonishing 3.7 times, and was subsequently monitored at weekly meetings.
When you commit to a goal and feel responsible to someone, it becomes easier to accomplish it.
6. It’s a good idea to be on the same page as your spouse
The biggest reason for divorce is money. Maybe it’s because the couple isn’t talking.research by Fidelity Investments We found that only 38% of couples discuss their financial strategy for retirement.
Involving your spouse or partner in financial decisions can be an important financial health strategy. Research shows that collaborative decision makers are less susceptible to behavioral biases and result in better outcomes.
7. Talking about money with co-workers can increase your income
It may be uncomfortable and taboo in the workplace, but discussing it openly with co-workers can increase your income. It’s important to understand how your salary compares to others in your field. And even if you avoid the nitty gritty numbers, talking about money and income can help you make a strong case for asking for a higher salary or looking for another job.
8. Talking to your kids about money will help them live a better life.
Our attitude towards money is formed throughout life and is influenced first and foremost by the example of our parents. By talking with your children first about your financial strengths and weaknesses, you can help them do better in the future.
Researchers found that people in households who talked openly about money were less likely to have impulse buying problems and had significantly less credit card debt.
9. And it’s important to talk to your children about your wealth (or lack thereof)
Although opinions vary, most financial experts recommend that parents be open with their adult children about their inheritance expectations. It’s also important to be honest if you anticipate needing financial assistance as you age.
Learn more about inheriting financial values and get tips for discussing money with your family.
10. You might be surprised what you learn from talking to your elderly parents.
It’s important to understand your parents’ financial situation, especially if you want to help them in some way. Also, the sooner the conversation begins, the more options you have for providing assistance.
According to Pew Research, about a quarter of adults between the ages of 45 and 64 are caring for an older adult. Of those providing assistance, approximately 58% help with errands, 28% provide financial assistance, and 14% provide personal care.
There’s no shame in talking openly about retirement
As teenagers, we may have been embarrassed to talk about personal things, but when we did, we discovered that everyone else had similar issues.
In middle age, we may have been embarrassed to talk about things like not being able to get ahead at work or problems with our children. But after talking, I realized that everyone else was experiencing the same kind of dilemma.
As retirement nears, you may worry that you’re the only one who hasn’t saved enough or doesn’t know how to generate retirement income or when to start taking Social Security. yeah. However, it is unlikely that you are alone.
Research shows that only a small percentage of people are actually ready for retirement. The rest of us are trying to figure it out. And we can help each other find the right answer.
How to start a conversation
ask a question
What is the secret to becoming a good conversationalist? Ask questions and listen to the answers.
You don’t need to share much about your financial situation to have a successful financial conversation. Try one of the following icebreakers.
- What is the worst financial mistake you have ever made?
- What did you learn from your parents about money?
- Do you have financial goals?
- Where can I get help with financial decisions?
Understand why you don’t want to talk about money
Maybe you feel embarrassed about having too much or too little money. Maybe you’re afraid of sounding stupid. Once you understand why you’re avoiding conversations about personal finance, you can address what’s holding you back.
Build and maintain your own financial plan
If you have a firm grasp of your financial situation, you may feel more comfortable talking about money. NewRetirement Planner helps you assess your own situation and fully understand all elements of retirement and financial planning. Retirement planning is more than investing.
Take a financial planning class
Want the ultimate confidence boost? Take it! retirement planning class! NewRetirement offers two different courses. One is an 8-week “Introduction to Planning” class, and the other is a “Dive Deeper” course with 16 different topics. Classes will be held on zoom (or you can watch the recording at any time). We also have live Q&A sessions so you can learn from your colleagues.
Get retirement club tips here.