Americans aren’t known for shying away from hot button conversations. From the constant political spin on 24-hour news stations to our obsession with celebrities and reality television, we pour ourselves into current events, ongoing controversies, and people’s lives. And, we have strong opinions on them.
We seek endless advice and validation on raising children, arguments we have with friends, and which new restaurant we should try. But our openness knows boundaries because, for some reason, most conversations grind to a screeching halt when someone gets close to approaching the topic of money.
Why We Don’t Talk About Money
According to a survey conducted by Wells Fargo, nearly half (44%) of study participants found talking about money more controversial and difficult than even traditionally thorny topics like politics and religion.
But, are we doing ourselves any favors by avoiding conversations about money? I say “no.”
In fact, avoiding money talk might do a lot more than shelter people from uncomfortable conversations; it might prevent them from learning and growing – the two things that can improve one’s financial health over time.
I should know. When my husband and I started making real financial progress, our first steps were built on lessons we learned from others. Not only did we read popular personal finance books with real world examples like “The Millionaire Next Door” and “Your Money or Your Life,” but we also read blogs and got comfortable talking to friends about their own struggles.
The more we listened, the more we ultimately learned. And although it was painful to face the truth about our financial situation at times, the lessons we learned from facing our problems head on, and talking about them, were truly priceless.
Four Money Taboos We Must Break Down
If I have learned one thing, it is this: If we want our individual relationships with money to change over the long haul, that change has to come from ourselves.
Enlisting the knowledge, learnings and support of your family and friends is imperative to reaching your full financial potential. And, the only way to do that is by embracing a dialogue.
Money Taboo #1: Financial Failures
Most of us have made mistakes when it comes to our finances, but few are willing to share those experiences. Perhaps it’s because we don’t like admitting our own failures in life.
But, what happens when you share your negative experiences with money with your friends and family?
People aren’t nearly as judgmental as you think they’ll be when you admit to money mistakes. They’ll likely be impressed that you’re admitting them at all. Plus, your friends and family could glean important lessons from your financial missteps.
In my life, I have seen this play out time and time again. Every time I share the story about how I bought a $25,000 car when I made little more than minimum wage, then struggled to pay it off for years, it makes people cringe. Not only do they feel sorry that I struggled so much in my early 20s, but they take note of the underlying lesson – the fact that spending more than you can afford can wreck your finances for years. I know it has made many people in my life question buying that more expensive car model or even house.
Sharing our financial failures can be therapeutic, but it can also help others make smarter, more informed choices. It’s not cool to live outside your means. Looking at you, Kanye West.
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Money Taboo #2: Financial Successes
While hiding your financial failures is common, so is downplaying the times when you got it right.
Telling friends you opened a savings account for your child’s education, asked for that raise at work, bought life insurance to protect your family, or hit a savings goal might make you feel as if you’re bragging. But, what if that kind of talk is actually the motivation someone else needed?
Celebrating our successes is just as important as admitting our failures. At the end of the day, the progress we make with our own personal finances might be enough to help our friends realize what is possible. And if they never knew about these common, smart financial choices, they may never have the opportunity to follow your example.
I’m very proud of the fact that my husband and I are debt-free aside from our mortgage. And I know the fact that I am so passionate about saving for my children’s college education has inspired many other people I know – including family members – to open 529 accounts for their own kids.
If I wasn’t so willing to share these little “wins” in my life, maybe some of these people wouldn’t have been inspired to do the same. Or, they would have put off starting to a later date.
Let your success motivate others to reach for lofty goals in their own financial lives. And if they think you’re bragging, so what?
Money Taboo #3: Debt
While most of us are open about our purchases – new purses or shoes, toys, and power tools – few of us feel comfortable sharing how we actually paid for those items. Most of the time, big items and “splurge purchases” are paid for with credit, which means they can add to our debts and stress us out over time.
If you only look at what everyone around you owns, it’s easy to become confused by how they afforded it. But when you realize that most people are making monthly payments on their cars, furniture, and credit card bills, it makes a lot more sense.
When our pricey home remodeling project wrapped up last month, one of our friends asked if we got a good rate on our Home Equity Line of Credit (HELOC). When I told her that I loathe debt and, as a result, we saved up for our project and paid cash, she was taken aback. Unfortunately, it’s not as common to save up for big expenses anymore – especially when it’s easy to just place it on your credit card.
I think it’s important to share information about what we go into debt purchasing. When I shared with my friend how we paid for our remodeling project, it underscored how much we really dislike debt in our household. And maybe – just maybe – it will compel her to save for a while if she wants to upgrade her own home or take on a large purchase.
Conversely, telling others how hard your debts were to overcome could even convince them to avoid debt in the first place.
Debt has a way of obfuscating the realities of our financial lives. The only way to “get real” about debt is to talk about it openly and honestly. Being without debt = freedom.
Money Taboo #4: Financial Dreams
When we talk about our financial dreams and goals for the future, it’s easy to become embarrassed. Why is that?
Is it because we (again) don’t want to feel like we’re bragging? Or is it because we feel silly admitting what we hope to accomplish one day?
I tend to believe it’s because we don’t want to gloat, and we don’t want to make others feel bad. Once you reach adulthood, there is a sense that one person’s success signals another person’s failure. And at the end of the day, we don’t want to make others feel bad about not achieving their own goals.
But, what if sharing your financial dreams actually inspired other people? What if telling others about your goals helped them look at their life and their goals in a new way?
Telling someone about your dream to become debt-free, travel the world, or retire early might help someone realize their dream is more attainable than they think.
As a business owner, blogger, and professional writer, I am always sharing my big goals and lofty dreams. My husband and I hope to retire fully by age 50, for example. And as of today, we are in the midst of seeing the world – one country at a time. I know for a fact that my goals inspire other people to reach for the stars in their own lives. Why? Because they tell me through emails, comments, and tweets.
Chances are, seeing great things happen in someone else’s life inspired your own dreams. So, why not repay the favor?
When we’re so open about everything else in our lives, it makes no sense to keep our experiences with money under wraps. After all, money is something we all have in common; we all need to make it, and we all need to make the most with what we have.
There’s also a larger perspective to think about it as well. As a nation, we would be better off with more money in our individual bank accounts and less debt, more focus on our goals and less hesitation, and more hope instead of fear.
The little changes we make in our financial lives can add up in a major way if we each do our part, but it can take some momentum to get the ball rolling. However, that initial nudge can be something as simple as a conversation with a neighbor or a story you share with a friend.
There is more to life than money, but there is little we can do with our lives without it. Breaking down money taboos is one way to close the door on the idea that we should face our money struggles alone – and open the door to what is possible.
Holly Johnson is a financial expert and writer whose obsession with frugality, budgeting, and travel plays a central role in her work. She serves as Contributing Editor for The Simple Dollar and writes for publications such as U.S. News and World Report Travel, Personal Capital, Lending Tree, and Frugal Travel Guy. Holly also has two blogs of her own – Club Thrifty and Travel Blue Book.