By Emily Guy Birken
on 4 November 2019
Money
has a funny way of sparking a number of disagreements, arguments, and even
lifelong grudge-matches. No two people are going to see eye-to-eye on every
aspect of money management, and since finances can be such a volatile topic,
any money misalignment between two people can cause a great deal of friction.
Unfortunately,
money arguments can often be much harder to navigate than your garden-variety
disagreements.
Here
are some of the most common money arguments you may have to deal with, and how
you can nip them in the bud before they interfere with your relationships. (See
also: 4 Money Fights Married Couples Have
(And How to Avoid Them))
Friends with expensive
tastes
We've
all had the experience of not feeling like you can keep up with high-rolling friends. They
might propose going out to eat at Cafe Riche where cocktails are $25 each and
the entrees don't even have prices listed — while you were hoping to share a
pitcher of beer and a plate of nachos at the local dive bar where no one blinks
when you pay with sofa-cushion change.
It can
feel awkward to ask your monocle-wearing friends if you can change the venue,
but going to their preferred spot to pick at the cheapest side salad on the
menu is a recipe for resentment. Especially if they suggest splitting the bill
evenly at the end of the night.
You may
worry that you're in for a fight no matter what you do, since pointing out the
differences in your spending habits can end with hurt feelings. However, it is
possible to get ahead of these potential arguments before they become a
problem.
To
start, you could simply state out loud that you're working with a tighter
budget than you'd like, so you're hoping to have fun on the cheap. If that doesn't
feel comfortable — not all friends are at the "sharing their financial
reality" level of intimacy, after all — then consider suggesting fun
activities that are free or cheap, and simply bowing out of the reservations at
Chateau du Moolah.
Finally,
if you do end up tagging along to some of the expensive restaurants, ask for
separate checks when you order, rather than wait for the awkward moment at the
end of the meal. (See also: 5 Friend Types That Can Hurt Your
Finances)
Misaligned spending
priorities
A
surefire path to an argument between married or cohabitating couples is when
one person spends money on something the other person thinks is unnecessary.
Whether the money is going toward education, a new gadget, groceries, or
clothes, one person may feel that the other is being completely irrational. The
spender might feel like the saver is either a buzzkill or unsupportive, while
the saver may think the spender is irresponsible and doesn't care about their
future.
This
kind of argument can be easily averted with separate fun money funds. Making
sure each person has their own fun money can allow them to make purchases the
other might see as unnecessary, without it becoming an issue.
It gets
much thornier when larger spending priorities are misaligned. If you and your
partner cannot agree on how much to spend on things like education, career
needs, food, or the like, then having separate funds cannot solve the problem.
This is
when it makes sense to talk about the basis of your spending priorities. If you
feel strongly that you should pay for your child's education and your spouse
disagrees, taking the time to talk about what those actions would mean for each
of you can help you figure out what you're each trying to accomplish. Knowing
the why behind your spending priorities can help you find common ground
that will lead to a compromise. (See also: 4 Ways Couples Can Tackle Money Goals
Together)
Loaning money
One of
the most awkward money issues you can face is when a friend or family member asks to borrow money. You
may find yourself feeling anything from shame at being unable or unwilling to
help financially, to resentment for being asked in the first place. And if you
do decide to loan money, you may find yourself silently judging every financial
choice they make while you wait for repayment, and wondering when and how you
can ask for the money back.
The
best way to nip arguments about loans in the bud is to set clear expectations
in advance.
To
start, that means saying no if you're unable to extend the loan. If you're not
in a position to lend money to your loved one — whether it's your financial
situation or your emotional situation — then you need to tell them that you
can't help them that way. Don't say you can't afford to loan them money, since
that can be construed as an invitation for your would-be borrower to question
every purchase you make. You can make it clear that you do care about their
situation by asking if there are any non-financial ways you can help.
If you
do decide to loan them money, treat it like a formal loan. Tell your borrower
that you require a written contract with the repayment terms spelled out,
including what will happen in case of a missed payment. There are free templates
for promissory notes available online that can help you draw up the contract.
Having this in place will make it clear to your borrower that you're treating
the loan as a serious transaction. These boundaries will also ensure that you
preserve the relationship.
If your
loved one feels affronted by these terms, remember that you don't need to
manage their reaction to your financial requirements. They are the potential
borrower, which means you, as the lender, get to set the terms of the
loan.
Don't let money get in
the way of your relationships
In a
perfect world, money would never come between you and your loved ones. But in
the real world, money disagreements can cause a great deal of resentment and
distress. However, setting firm boundaries and talking openly about your
priorities can help you keep money arguments from turning extremely ugly.
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