The importance of money conversations
September 26, 2019
Research by Wells Fargo found that 44 per cent of Americans consider personal finance the most challenging topic to discuss. That seems strange when there are so many other difficult subjects such as politics and religion.
Financial issues are essential to our lives. Financial decisions are how we allocate wealth to provide a desired standard of living. So, talking about finance isn’t just about money, it’s about our lives.
Why is something that affects entire lives be such a sensitive subject?
Time magazine reported that 40 per cent of couples do not discuss money issues before getting married. Financial issues can include career choices, buying or renting accommodation, vacations, and having children.
Marriage is often about shared values. Without a constructive conversation about values and how to prioritize major decisions, in my opinion, that union doesn’t have a strong foundation.
If lack of communication on money issues is the problem then the solution is to start having financial conversations.
Friends and family can be a good starting point. According to Scientific American, a study done in 2009 found adults are less likely to have financial problems, such as high debt and impulsive spending, if they were raised in a household that spoke freely about financial issues.
Money conversations can have a positive effect when attempting to save. According to a 2011 study, Under-Savers Anonymous, those who publicly declared their savings goal, and monitored it weekly, saved almost four times more than the general population.
One possible justification of not discussing financial issues with your spouse is that one of you doesn’t have any interest or ability in this area. A study by Bateman and Munro, An Experiment on Risky Choice Amongst Households, found that couples who discussed finance together were less likely to have financial risks.
Money and how you spend it will have a great impact on your life.
Discussions about money are important and can lead to positive financial outcomes. I encourage everyone to open up and talk about their financial issues.