7 rules: How to talk to family about money

Two family members talking about money.

Money. It’s fun when you have it. A downer when you don’t. And it can be awkward to talk about, even with your closest family members. But sometimes you have to go there.

Why talk money?

If you have aging parents, you may need to talk to your siblings about how to help Mom and Dad with their finances.

Or if you have a sibling with special needs, you and your parents may need to talk about creating long-term financial and caregiving plans.

And if you’re sending your daughter off to college, a very frank discussion about what you can and can’t afford may be in order. No sense getting her heart set on a school that costs as much as your house.

Bottom line: When you have to talk money, a few rules of engagement can help.

1. Make it a real meeting.

Set a time and place. (Meaning it’s not a big surprise money talk.) This gives family members time to think and to take the situation seriously. It’s OK if you don’t all live in the same town—use Facetime or Skype. Oh, and don’t have the talk during Thanksgiving dinner. Holidays can be stressful enough.

2. Start with a small crowd. You can always make it bigger.

Like any meeting, you run the risk of losing focus if it gets too big. Maybe start with siblings in a money talk with your parents, and leave the spouses at home. If your mom has two sisters she’s close to, include them in your conversation with her instead of all her brothers and sisters.

3. Don’t slip into old family roles.

That can happen when you get together. Your sister was the “smart” one. Your uncle was the “irresponsible” one with his finances. This is the time to take a fresh look at who they are now, as adults, and respect the perspective they bring to the table.

4. Stay calm.

As best you can. Emotions can run high when you talk money. Assume everyone has good intentions and that you’ll all be better off talking about this together. If the discussion gets too negative or “spirited,” table it for another time and tackle the stuff you can all deal with that day.

5. Listen. Really listen.

Even if you’re the one leading the conversation, don’t do all the talking. Pull out some paper to jot down notes if that helps you truly listen. And remember this is the time to talk, but not to criticize. If Dad let his long-term care policy lapse a few years ago, don’t judge. Listen and help him figure out the steps he can take to cover his expenses.

6. Don’t be afraid to ask for help.

Depending on the situation, you may want to include someone who can offer an unbiased voice to help guide the conversation. Whether it’s a financial advisor, a minister, or a trained counselor, an “outsider” can help keep the discussion moving or know when it’s time to take a break.

7. Revisit the conversation.

As the situation changes over time, you’ll want to talk about how that affects the financial plans and decisions you’ve made.

Talking to family members about money can be productive and a relief to all involved. If you can work through some initial awkwardness, an open and honest talk may just help solidify family bonds and give everyone peace of mind.  

Next steps:

  • Get started now by setting up the family meeting. (See rule #1 above.)
  • Find an advisor near you to help guide the conversation.
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