Skip to Content
Tally logo

How (and Why) You Should Talk Finance with Friends

Money is one of the most taboo topics to discuss with friends, but it doesn't have to be. Here's how to talk about money with friends and why it's important.

June 3, 2022

It’s not exactly a secret that most Americans don’t like talking about personal finances.

Sure, you may have one or two wealthy friends in your circle who talk about money, but for most of us, finances are usually an uncomfortable topic to discuss, especially when it comes to money and friendship.

Indeed, according to arecent study done by OnePoll for Questis, more than half of Americans (56%) consider talking about money taboo. Most of us would actually be more comfortable talking about sex, politics, drug addiction, religion and even marital problems than money per anotherstudy by Capital Group. This study found household earnings, retirement savings and debt to be among the most taboo money subjects.

But what if we didn’t treat money as a taboo subject and discussed it openly within friends? What are the possible benefits of mixing money and friendship? Also, what’s the best way to bring up and discuss money with our peers?

Let’s try to find out.

Why Do Americans Dislike Talking About Money?

Several experts have tried explaining why Americans are so averse to money conversations.

Rachel Sherman, a sociologist at the New School in New York, for example, toldThe Atlantic that people often avoid talking about money simply because they feel bad about how much money they have. She says "not talking about it makes that feeling of badness go away."

John P. Vincent, a psychology professor at the University of Houston, shared more or less the same sentiments onToday.com. In his view, the discomfort with money discussions stems from a fear of judgment. Individuals without resources, for example, fear being looked down upon and judged as lazy, stupid or poor money managers.

Meanwhile, Caitlin Zaloom, an anthropologist at New York University, says that the money taboo comes from a widely held belief that "your value as a human being is somehow made material in your pay and in your account."

Zaloom says that if people were to publicly reveal their income, for example, they’d essentially be "exposing how they are valued by their employer and how their contribution is valued even more broadly, by the community."

Money and Friendship: Why Should You Talk About Finances with Friends?

Money can be a touchy subject in a friendship, but talking about it can have many benefits.

Become more informed about financial matters

Having conversations about money with friends can be a great way to become more informed about financial matters. 

You might learn about new products or services that can help you save money, or hear about investment opportunities that you wouldn't have otherwise known about.

In your discussions, a friend might share the budgeting tools or resources that they’ve found most effective for managing their money. Or they might tell you of the strategies they’ve found to be most efficient for paying off debt.

In a nutshell, you can get new, valuable insights and perspectives on personal finances and learn from each other’s experiences. This can help you make better decisions when it comes to your own money.

Break financial anxiety

According to Nicholas Arreola, chief behavioral scientist and analytics officer at CLS Investments in Omaha, Nebraska, venting about money to a friend can also help release bottled-up financial anxiety.

When we share our money worries with friends, for example, we might realize that we aren’t alone in our struggles — your friends could be facing the same challenges.

Talking about money can provide perspective, help you build a support network and perhaps find solutions for your shared problems.

Get support and encouragement for financial goals

Money conversations within a friendship can be a great way to get moral support and encouragement when it comes to working toward financial goals. 

If you have a friend who also has financial goals, you can work together to hold each other accountable until the two of you reach your respective goals.

How to Talk About Money with Friends

Find your “money talk mindset”

To ease into the topic of money in a friendship, wealth psychology expert Kathleen Burns Kingsbury recommends starting by finding your "money-talk mindset," i.e., your automatic thoughts and beliefs about money and then engaging with another individual on the same themes.

According to Kingsbury, asking yourself the following questions can help the process of figuring out your own money mindset:

  • What lessons (if any) did your parents give you on money conversations?

  • What are the easiest and most difficult money conversations for you to have?

  • What are some of your biggest fears when you think about money talk?

  • What do you think you'd gain from breaking your money talk taboo?

  • Which person do you consider safest to start a money talk with?

These questions, as Kingsbury notes, can help ease you into the conversation in a non-overwhelming way and guide a productive discussion about money.

Speaking of non-overwhelming, once you begin conversations on money, try not to go into the deep stuff right away. Start with a slow approach and build a foundation. 

Try, for example, talking about money in general terms, such as your favorite money-related sayings or how money affects your day-to-day life. Once you've broken the ice, start sharing more specific information, such as your financial goals or concerns, or asking deep questions.

Respect boundaries

When talking about money with friends, it's important to respect each other's boundaries. If there’s something that a friend isn’t willing to share or topics they aren’t willing to discuss, don’t push it. That’ll only cause friction and may result in them shutting down.

Be direct and honest

Finances can be a sensitive topic, but beating around the bush or tip-toeing around certain money issues when talking with friends is only going to make things more awkward and prevent the conversation from having any meaningful effect. Therefore, try to be direct during your conversations.

For example, offer to share your numbers (e.g., income, savings, debt, etc.) first. This can encourage a friend to share theirs and help move the conversation forward in a way that’ll be beneficial to both of you. 

Above all, be honest. If you're honest about your own finances, including your financial struggles, it’ll encourage your friend to be honest as well.

Be respectful

When broaching finances with a friend, you may not see eye to eye on everything. Even if you don’t agree with someone’s financial choices, avoid judgment and try to see things from their perspective. You can offer constructive criticism when necessary, but you should also be willing to receive it. 

Final Thoughts

The next time you're feeling awkward about talking about money with friends, remember the possible benefits you could gain from it—  becoming more informed about personal finances, breaking financial anxiety and getting moral support and encouragement. 

If you’ve never broached this subject with friends, use the tips outlined to get started. And for more insightful personal finance tips and tricks delivered straight to your inbox, be sure to subscribe to the Tally newsletter.