It continues to sadden me to see how money remains a taboo topic in many homes. Even worse, so few people realize the high price of keeping money secrets. January is the month most people set goals, which frequently have some sort of financial component to them, whether it’s getting out of debt or saving money for the things you want. Those are excellent goals and give you a chance to break the wall of silence around money in your home.
Sometimes we keep money secrets with the best intentions, believing we are protecting our families with our silence, but more often than not, secrets do more harm than good. They create distrust, teach kids it is okay to keep money secrets or lie and prevent goal achievement.
According to American Institute of CPAs, 46% of us who set financial goals will fail. Ouch. While there are other contributing factors, money secrets certainly affect your ability to achieve goals. This is not the good kind of secret, but the kind that weighs you down and fills you with doubt or guilt. Being able to confide in someone or seeking help can make the difference between goal success and goal failure.
Let’s make 2015 the year money becomes an approved topic in our homes. Here are 5 steps to help you break the cycle.
Chris and I are committed to talking to our daughters about money but before we started, we thought about what we wanted to teach them first. Before beginning the conversations, identify what your money beliefs are and whether you want your kids to mimic them. Respectfully, you may uncover that your money beliefs need an overhaul too.
Goals are one of the easiest ways to start money conversations in your family, either with your spouse or children. It excites us to think about possibilities, so use their enthusiasm to make positive money changes. Setting goals as a family has really helped the girls understand why we make the choices we do.
As a parent, I sometimes feel as though I need to have all the answers, and I don’t. It can be humbling and even a little scary. You may not feel very knowledgeable about money now, but that shouldn’t stop you from talking about it. Just share what you do and do not know. Your kids will appreciate your honesty and learning together can actually be a great family bonding moment too.
Remember, we want to stop keeping money secrets, which includes mistakes. Your home should be a safe place where mistakes can be shared as lessons, not for judgement. We all make money mistakes and burying them doesn’t prevent them from happening again. In fact, hiding them is what often leads to bigger mistakes.
Money conversations don’t need to be lectures. They can and should be fun. Look for teachable moments to help your kids learn how to make good decisions with their money. And seek to understand when you find yourself having philosophical differences on how to use family money with your spouse.
One resolution I hope everyone makes this year is to talk about money within your home. It’s not hard or scary, I promise. My guess is that you will wonder why you waited so long once you start having amazing and open conversations around money with your family. So I encourage you to start today.
How are you breaking the money taboo cycle with your kids or spouse? What helped you start the conversation?
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SHANNON RYAN, CFP®
I love this infographic! I think we are well on our way to breaking the cycling in our home. My kids are young adults now and soon they'll be off on their own. Now more than ever I'm talking to them about making good decisions with their money as well as sharing our money mistakes so they won't repeat it.
Thanks for sharing these tips with us. I used to think talking about money had to be serious but you're right it doesn't have to be a lecture. I guess I felt that way because that's how it was with me.
Thanks again for sharing! Hope you're having a great week!