Give Your Family the Gift of Financial Conversation This Holiday Season

December 24, 2020 Updated: December 28, 2020

Dear Readers: If there’s one thing many of us are reluctant to talk about, it’s money. We might be comfortable sharing all sorts of personal information—about our health, our religious beliefs, even our personal relationships. But when it comes to our finances, we clam up.

And this year, that reluctance may be stronger than ever. If you’re one of the millions of Americans who have lost their job or their home and are struggling to make ends meet, money may be the last thing you want to discuss. Or if you believe that a loved one is worried about his or her finances, you might be hesitant to bring it up.

Trust me, I get it. Even in good times, our finances can trigger all sorts of emotions, ranging from fear to embarrassment to guilt. Others may feel unprepared to deal with their money and, therefore, don’t discuss it. Or others may believe their personal finances are just that—personal—and not to be shared.

The problem is that this reticence can work against us. The financial world has gotten so complex that we all need guidance and support from time to time. And this year in particular, we need each other more than ever.

Therefore, this holiday season, my hope is that individuals and families across the country will initiate open, honest, and respectful conversations about money. Spouses, children, and parents: Whether you’re personally facing financial challenges or not, whether you’re concerned about a family member or not, I encourage you to share your thoughts, your knowledge, your wisdom, and your encouragement. And opening up can be especially important if you’ve had a tough year. In so doing, you can not only pave the way for more economic security but also forge closer emotional ties.

Some Suggestions for Getting Started

To be completely honest, talking about money can feel awkward at first, especially if you’re not used to it. If this is new for you, my first suggestion is to start with some introspection. Think about your own relationship to money. By nature, are you a spender or a saver? Are you cautious or more of a risk-taker? Are you goal-oriented? Are you a detail person or more interested in the big picture? All of these things will color the way you deal with money.

My next piece of advice is to take it slow. When you approach a loved one, explain your intention and set up a convenient date and time to talk. That way, no one will feel blindsided and everyone will have the time to collect their thoughts.

I’m reminded of this by a young colleague who anticipated a visit from her age 70-something parents. Concerned about their finances, she gave them a heads-up that she wanted to set aside some time for a money talk. That way, her parents felt prepared, and the three of them were able to have open and productive talks over the course of their time together. Not only did the parents agree to meet with a financial planner but they were also able to open up about a host of other important issues—from their delayed retirement to their estate plan. And, perhaps best of all, the entire family can now face the future with a new confidence that they will discuss issues as they arise.

Treat Everyone With Sensitivity and Respect

Whether you’re talking to a spouse, a sibling, a child, a parent, or a grandparent, a few principles remain constant. While many of them may seem obvious, they’re easy to cast aside when emotions kick in.

First, in money, as in life, there’s no place for deception. As much as you may want to paint a rosy picture or cover up some embarrassing details, it’s essential to face issues head-on and present them honestly. I recently wrote about the importance of being frank with your children, even when times are tough.

Of course, the same goes for couples. We all know money can be a huge stress in a marriage, especially when money is tight. I’m a big believer that each spouse should have some financial autonomy at the same time that they share all of the big decisions. So, if you’re just starting out together, take the time to establish some guidelines and get on the same page financially. Or even if you’ve been married for years and avoided money conversations, it’s never too late to start. Think about it as an opportunity to share your values and work together toward a common goal.

And, finally, avoid the blame game. It’s fine to disagree, but listen carefully to the other person’s thoughts before you respond. Do your best to steer clear of hot buttons and stay positive and non-accusatory. Give each other the benefit of the doubt.

Back Up Your Discussions With Sound Information

If, in the course of your conversations, you realize that you need more information before you commit to a course of action, that’s not only fine; it’s advisable. Do your research and consider consulting with a trusted professional so you fully understand your options. Money conversations are hardly ever one and done. What’s important is that you start the process; remain guided by the facts and your goals; and commit to finding solutions.

Looking to the New Year

I honestly can’t think of a year that has been as challenging as 2020. My heart goes out to every person who has lost their home to a forest fire or a hurricane; their loved ones to the pandemic; or their business or job to the economic fallout.

These catastrophes underscore the importance of our personal relationships. And my hope is that, as we look to 2021, we will begin the healing process by reaching out to all of the people we care about most.

When we talk about money, we’re really talking about much more. Money is nothing but a tool to allow us to follow our hearts and our dreams. Let’s start the new year by engaging in open, honest, and respectful conversations about those hopes and dreams—and work together to make them a reality.

Carrie Schwab-Pomerantz, a certified financial planner, is president of the Charles Schwab Foundation and author of “The Charles Schwab Guide to Finances After Fifty.”