Investing: Talking about our money

March 19, 2013 

It is time that you talk about your money. No, I'm not proposing you broadcast your wealth, or lack of it, to the community. I'm suggesting you talk about how you feel about money and what it means to you.

If you are single, an honest talk increases your self-knowledge and points out areas that could use some improvement. If you are in a relationship, talking about money can make you happier while avoiding breakdowns, high stress and increased debt.

Most people don't know how to constructively talk about money but everyone can learn.

Why don't people talk about money? Some reasons include our past experiences and biases, fear of looking incompetent or losing control. All of these fears and past learnings can be dealt with and used in constructive conversations. Before starting, experts suggest you agree on some ground rules and do your homework.

In your first conversation, agree on what you will do if tensions escalate. If you are not used to discussing money, it may take a few tries before it goes smoothly.

Jointly agree on a way out, such as delaying the talk for 24 hours if one person is not ready to continue. Agree to respect each other's views by not interrupting and avoid judging an idea before it has been explained.

To prepare for yoursecond conversation,do your homework by understanding how you think about and use

money. Each person can evaluate themselves by using tools such as Money Habitudes (www.MoneyHabitudes.com) or the Getting to Know You, Your Co-Spender and Money sheet by Ohio State University Extension (http://bit.ly/XPWlST).

When you talk, compare notes so you understand where the other person is coming from and where they are today. Once you understand and acknowledge their point of view, you can work on your first goal.

If you can't decide where to start, work on the definition of short-term and long-term goals. Then jointly choose a short-term goal, such as how to save money for an upcoming vacation. Short-term goals are a good place to start, as you will see results quickly.

When you understand how you feel about and use money -- your money personality -- you can see where you match up and are different from your partner. Both people can use their strong points to improve the situation.

If you don't feel comfortable with money, you owe it to your relationship to spend time learning how to manage your cash, debts, savings and investing for the future. You can learn together on the Internet, in workshops or by scheduling a meeting with a money coach.

Money is an indicator of how much we can control in our lives. If our finances are out of control we will not be happy. Having different money personalities, you may not always agree but ignoring money often leads to spending more and enjoying it less.

Learn to have constructive conversations with your partner and you can strengthen your relationship.

Tom Roberts, CFP and owner of A New Approach Financial Planning in Lakewood Ranch and Sarasota, can be reached at 941-927-9590 or Tom@ANewApproachFP.com.

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