Retirement, Investments, & Insurance for Individuals Build your knowledge Not sure how to have the “family and finances” talk? These tips can help

Not sure how to have the “family and finances” talk? These tips can help

Conversations with family about money can be difficult and emotional—but they're necessary. Here’s help for beginning (and continuing) talks about family finances.

Mother and daughter sitting together on a couch looking at a computer and talking about money.
3 min read |

When’s the last time you had an honest conversation with a family member about money? Turns out, many of us don’t even have open discussions in our own households about finances: 30% of men and 19% of women have a credit card balance their partners don’t know about.(1)

But talking about money—what we do with it, what our plans are for it, whether we need help with it—is important, and probably doesn’t happen enough. The urgency may be even greater if your family includes people contemplating retiring in the next few years: Over 40% of baby boomers, the generation aged 56-64, don't have any retirement savings.(2)

These tips can help start and continue those important conversations about family and finances.

1. Start meeting formally about money and family.

Sounds weird, right? But informal chats lead to surprises—and may also end up with friction. Also avoid big days, like holidays; they should be focused on celebration. Instead, set:

  • A scheduled time
  • A concise agenda; assume you’ll have multiple meetings (see step 2)
  • A comfortable location
  • A small list of attendees—just those playing a role in decisions

2. Narrow the conversations.

Ultimately what you’re worried about may be big. But keep the topics simple: The easier it is, the more confidence you will have in the discussions.

Family and finances conversation starters
If you’re unsure about retirement plans “What does retirement look like for you?”
If long-term care may be an issue “What worries you about money in the future?”
If you don’t know what their legacy plans are “How do you want to be remembered?”
If you think they may have financial concerns about income or expenses “What makes you comfortable or uncomfortable talking about your money?”

3. Try to keep emotions out of the conversation.

Many people only start to talk family and finances when they’re facing a crisis or having end-of-life conversations. “Talking about your finances at this stage is forcing you to face your own mortality, and that’s never comfortable for anyone,” says Stanley Poorman, a financial professional with Principal®.

These tips might help:

  • Write down talking points before you meet.
  • Take notes.
  • Avoid labels. Just because a sibling made a choice you disagree with, for example, doesn’t mean it’s OK to call them irresponsible.
  • End the meeting early, if needed, especially if the conversation becomes heated.
  • Listen. Then listen again.

4. Schedule money and family meetings regularly.

With every successful conversation you have, set a time and a topic for the next discussion. That helps you be specific and supportive; this isn’t the only conversation, but the first conversation.

5. Find neutral help if needed.

Poorman helps other people with their money for a living. Still, it can be hard for his own family members to come to him for insight. If you feel stymied or there’s too much tension, a neutral third-party, such as a financial professional, may be able to help. “Sometimes I just put it out there that I can help if they want, and let them come to me,” Poorman says.

That’s because learning how to talk to family about money is hard. “You won’t get it right 100% of the time, but simply starting from a place of good intentions is important,” Poorman says.

What’s next?

If you need to have your own conversation about family finances, it’s good to prepare. Start by logging in to principal.com to check your savings rate. Don’t have an employer-sponsored retirement account or want to save even more? We can help you set up your retirement savings with an individual retirement account (IRA). Ready to learn more ways you can build your financial foundation? Our learning library can help.