5 Damaging Myths About Money Talks & the Facts Behind Them

Kim Johnson |
Categories
Investments
Finance
Lifestyle
Savings
Family

What money topics are the most taboo to talk about?

Earnings, debt, inheritance, or net worth?

For most of us, many financial topics are simply off-limits.1

That means that many of us are not discussing money as much as we probably should be.1

Without those talks, myths about money and financial conversations can get a much stronger grip on our perspective and our financial decisions. That silence may end up stunting our financial literacy.1

To move past that and break free of the harmful misconceptions, let’s look at some common myths about money talks and the facts behind them.

Myth #1: My net worth defines my self-worth.

Fact: Our personal worth and value encompass so much more than our financial worth, but many of us collapse the two, sometimes without even realizing it. That may not be surprising, given cultural norms and upbringing, but it’s no less misguided.2

If we tie our self-worth to our finances alone, we’re more likely to prioritize money and money-making endeavors over everything else, including life-enriching experiences and relationships. That can make us far more vulnerable to isolation and disconnection.3

Myth #2: I should only talk about finances with my spouse or partner.

Fact: If you’re talking about finance at all, you’re most likely to do so with a spouse or partner — but that does not mean your spouse or partner is the only person that’s important to discuss finance with.1

Talking to your children about money can help them understand key lessons earlier. That can improve their financial well-being later in life.4

Discussing finances with parents can clarify their wishes and circumstances, which may reduce conflicts or misunderstandings later.5

Beyond that, talking about finances with friends can give you a sounding board and crucial support when you may be feeling like you’re the only one facing certain issues, struggles, or concerns.

The bottom line is that limiting money talks to just a spouse or partner can hold you back, impact your loved ones, and perpetuate the culture of silence around money.

Myth #3: Talking about inheritances with my family will spark greed or fighting.

Fact: Of all taboo money topics, death and inheritances rank high on the list, even though most of us say we’re open and ready to talk about these topics with our loved ones.6

Fears of greed, fighting, and potentially uncomfortable conversations can be all factors here.

Still, the truth is talking about inheritances and estates can clear the air, eliminating future surprises and reducing uncertainties. That could actually minimize the risk of future fighting, establishing clear expectations and getting families more on the same page.

Myth #4: Every money talk has to be serious, heavy, and stressful.

Fact: Financial discussions can be weighty, but not all of them have to be laborious or painful. Choosing the right time to have these conversations can make for less stressful money talks. So can thoughtful entry points. In fact, how you start a money talk can set the tone, possibly kicking off the conversation on a more positive and productive note. To that end:

  • Open-ended questions can be effective kick-off points for several types of money talks.
  • Personal stories and experiences can offer unique chances for connection, levity, and deeper understandings.

Myth #5: I have to talk dollars and cents whenever finances come up.

Fact: Specific dollar amounts may come up in some money talks, but not every financial discussion has to involve numbers, real or theoretical. Talking about your values, plans, and habits associated with money can all be rewarding, possibly yielding fresh insights and new ways of achieving better outcomes.

A More Rewarding Way to Talk Money

Like saving and budgeting, talking about money can be deeply personal — and it can become part of your financial habits.

The more you’re able to talk money openly and honestly, the easier it can be to identify the myths and misconceptions that can lead you astray. With these conversations, you can also open up new opportunities to learn, gain new perspectives, and make more informed decisions that can truly support your longer-term financial goals.1

Whenever you’re ready to talk money or you need more support in these conversations, an experienced financial professional can help.

Sources

  1. https://www.cnbc.com/2023/05/10/americans-arent-talking-about-money-it-could-hold-you-back.html
  2. https://bigthink.com/sponsored/why-is-it-taboo-to-talk-about-money/
  3. https://www.moneycrashers.com/separate-self-worth-net-worth/ (or original source; https://journals.sagepub.com/doi/10.1177/0146167220910872)
  4. https://news.stonybrook.edu/university/why-talking-about-money-with-children-matters/
  5. https://money.usnews.com/money/personal-finance/family-finance/articles/how-to-talk-about-money-with-family-and-why-its-important
  6. https://www.fa-mag.com/news/families-not-talking-about-inheritance--new-study-finds-77320.html

This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets. This material was developed and produced by Advisor Websites to provide information on a topic that may be of interest. Copyright 2024 Advisor Websites.