Growing up, I remember my Dad always being concerned about having enough money. My Mom, on the other hand, would buy stuff because it was on ‘sale’. I rarely remember them sitting down to discuss money as my Dad would get so frustrated. When they did discuss money, it never ended well.
Granted, we always had food on the table and a roof over our heads but the details of how that was all made possible were fuzzy.
Having worked in the finance industry for many years, I realized that my parents were not unique in their financial conversations — in fact, they were the norm.
Why? Because talking money is difficult and can leave you feeling vulnerable. Not to mention (until now) there hasn’t been a definitive guide or blueprint on what to cover or how to even start the conversation.
Thanks to friend of the blog and wealth psychology expert Kathleen Burns Kingsbury, that is no longer the case.
Kathleen’s book, Breaking Money Silence, discusses the roadblocks we face in society, in our family, and within ourselves that make talking about money and finance challenging. I’m so pleased that we are able to share some of her thoughts with you, Q&A style.
Question: I’ll just come right out and ask: why don’t people want to talk with an advisor about retirement? It seems many bury their head in the sand and just hope it will turn out OK.
The truth is that almost half of Americans would rather talk about death than finances. This fact contributes to many people not proactively talking about money and planning for a secure financial future. This includes retirement planning. I believe a big contributor to this reluctance to talk about money and as you put it “bury their heads in the sand” is the long-standing societal taboo that says talking about money is rude and unnecessary. In this book, I highlight how not discussing and planning for your financial future hurts women, couples, and families and what you can do about it in your own life.
Question: In working with couples, I notice that one person often takes the lead in the discussion and the other may be completely silent. How does your book, Breaking Money Silence, address this issue?
It is true that often there is a financially dominate person in a couple who takes the lead on managing the finances and making the investments. In the book, I discuss how this is okay as long as the lines of communication are open and that the person who defers to his or her partner is included in decision making. I also encourage couples to consider managing the money together and engaging in regularly money talk. Research says that partners who talk about money more often are actually happier and more satisfied in their relationships. So believe it or not, discussing finances as a couple can improve intimacy!
Question: I’ve found that women tend to be very open with me about their money concerns. Is this the norm? Or are they more comfortable talking with other women about these issues?
In general, women are hardwired and socialized to be more verbal about their emotions than men. This willingness to open up carries over to talking about money. Unfortunately, the financial services industry doesn’t adequately train advisors (90% who are men) to discuss the emotional side of money, so many women get the message that it is not okay to bring these feelings in the context of a meeting. My guess is because you are open to hearing about these concerns, women feel more comfortable discussing them with you. It is less about the gender of the listener and more about a person’s willingness to actively listen, ask curious questions, and validate a woman’s emotions related to money.
Question: Many young people have never had a money conversation with someone ‘in the know’. They don’t learn practical skills from school or their parents, yet they are sent off for higher education and given huge loans they are expected to pay back on graduation. Yet only 59% graduate in six years or less. How can they improve their financial skills before heading off to college?
This is a great question and is something I cover in the book. I truly believe if we help people break money silence in their lives, then the next generation will become more financially literate as a result. The reason is that parents will no longer feel awkward or shameful when they don’t know the answer to a financial question. Instead, the parent and the child can engage in a dialogue about the question – in this scenario – how to best pay for college – and then explore solutions together. The best way to improve a child’s financial skills before heading off to college is to discuss money with them early and often, so when this big life event comes up it is not the first financial conversation you have had with them.
Question: The financial profession is filled with lots of jargon. We love talking about asset allocation, active and passive portfolios, risk tolerance, and economic factors. How can we, as advisors, start to move away from this confusing vocabulary to simpler concepts so we can better communicate with our clients?
In my keynote presentations, and training, I often say, “lose the jargon.” It is not impressing your clients, it is just confusing them. Not because they are not smart, but because the majority of them don’t work in the financial sector. When discussing finances – whether you are an advisor, a parent, or a partner – good communication skills are a must. Good communication requires you to actively listen, put yourself in the other person’s shoes, and focus on understanding their perspective. If advisors were to truly do this, they would speak in language that the client understands and use examples that relate to their lives. It is common sense, but the industry is reluctant to move from an expert model (i.e. let me tell you how smart I am) to a collaborative, coaching model (i.e. let’s work together to help you manage your money). This is changing but slowly.
Kathleen, thank you so much for sharing your thoughts with us! Readers, if you are interested in learning more about your money communication, you can find Kathleen’s book at the website below.
BREAKING MONEY SILENCE: How to Shatter Money Taboos, Talk More Openly about Finances, and Live a Richer Life
Wealth psychology expert Kathleen Burns Kingsbury dives into the taboo of money and taps into this neglected area of discourse from all perspectives—women, couples, parents, children, and wealth advisors—to offer a new vision for how we understand, communicate about, and plan for money. Empowering readers to defy the standard conventions around money, the book equips them with the practical tools to navigate difficult conversations, understand individual money mindsets, and plan for a more secure financial future. Kingsbury shows how, by doing so, marriages and families can remain intact, businesses can enable financial literacy and thrive, and women can inch closer to financial equity. Advisor Bonus: Each chapter ends with an advisor coaching activity so professionals can apply these concepts to working with clients and growing their businesses.
Breaking Money Silence® website: www.breakingmoneysilence.com.
Breaking Money Silence® on Amazon http://amzn.to/2wtiTAb
Pamela J. Horack, CFP® of Pathfinder Planning LLC provides personal financial planning advice and asset management for a simple fee to young adults and working families in North and South Carolina through group classes, one-on-one planning, and ongoing advice.