Have you ever attended a dinner party where you covered all sorts of intimate topics from past relationships to your last blood test results, but then there were crickets once someone mentioned money, their difficulty with saving or the perilous state of their credit card debt?
We don’t bat an eyelid before sharing pictures of holidays we’ve been on or dishes we’ve enjoyed, but when it comes to personal finances most of us find it too uncomfortable to share.
Why is money such a taboo topic? We did some investigating.
Is talking about money actually taboo?
In 2016, comparison site Finder.com.au conducted a survey and found that 42% of Aussie respondents agreed that money talk is taboo, more so than religion, sex and politics – some of the most controversial dinner party conversation topics imaginable, especially with your parents sitting across the table (Cards Against Humanity, take note).
The findings showed that only 18% of Aussies regularly discuss money. The younger you are, the more willing you are to talk about the dollars. Generation Y (18-34) are most comfortable discussing personal finances, with one in three laying their money lives on the table. On the other hand, Baby Boomers (55-74) are least comfortable discussing money matters, with 56% admitting to never discussing it.
So why aren’t aren’t we talking about it?
It’ll only cause a fight
Earlier this year, Finder.com.au also revealed that more than one in two couples admit to fighting about money either some or a lot of the time, with one in six admitting to rows about their finances every two to three weeks.
Psychologist and Clinical Director of Relationships Australia, Elizabeth Shaw, says one of the most common catalysts for household arguments is, you guessed it, the household finances. Generation Y couples are reportedly experiencing the most acrimony, with 12% arguing about their finances on a weekly basis.
Finder.com.au spokeswoman, Bessie Hassan, put a lot of this tension down to social media, which has a tendency to amplify the positive aspects of people’s lives, often setting unrealistic lifestyle expectations.
Another reason couples avoid openly discussing money matters, specifically around investment, is because each have different risk appetites and can’t agree on how to grow or spend their money, which means they can’t agree on short and long term financial goals.
It’s dashing my dreams
According to research by the Financial Planning Association of Australia, Aussies’ most significant life goals are most likely financial, with over half of respondents reporting their top short term financial goals to be ‘saving money’.
A 2017 nation-wide study into the financial wellbeing of Australians, conducted by Suncorp, found that 65% of respondents felt pressure to do well financially, while a quarter avoided discussing the topic altogether, for fear of being ‘judged’.
The same study also found that over a quarter of respondents had given up on dreams of overseas travel and 15% have given up the hope of owning a home.
More recent data also suggests that financial pressures, and the lack of support for young parents, is resulting in Australians having children later in life, and having fewer than had been intended. These impacts are felt in the near term at the individual family level, but in the longer term could have society-wide economic impacts.
Honey, we need to talk
There needs to be a more open conversation about managing personal finances, and the importance of having our financial affairs under control to our general level of happiness.
It’s no surprise that that financial concerns were reported as the leading cause of stress for Australians, accounting for close to half of all of personal stress incurred in the previous five years, and producing the highest levels of anxiety on record (Australian Psychological Society, 2015).
It’s obvious something needs to change – we need to have more open conversations about our finances.
Research shows that those who don’t like talking about their finances are in fact worried about them. The same research from Members Equity Bank showed that:
- The more you talk openly about your money matters with others, the less likely you are to be worried about them.
- The more you chat about money with other people, the more likely you are to actively manage your own.
- And the more you make the discussing of finances integral in your relationship, the less likely it is to cause tension and conflict.
There’s a clear benefit to being open and honest about your finances, especially if it’s keeping you up at night.
These financial conversations don’t necessarily have to be with qualified financial professionals, although that’s also a great idea, but with friends and family as well, in particular people your age. It could help you realise what you could be doing with your money and what you may already be doing wrong.
It’ll also do you a world of good to be more open about your financial position and future goals with your partner.
Keep the money conversations coming.
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Clover is a personal financial advisor and an online investment service for Australians.
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