Should you Share Financial Information with Family?
By Randall | February 6th, 2008 | Category: Psychology of Money | 14 comments 3,226 views | 14 Comments » |
One of my friends asked today, as a semi-anonymous blogger, if my family knows I have this blog. I don’t have any close relatives on my side of the family, and the in-laws aren’t particularly computer savvy, so I’ve never had a problem talking about my past financial education and fearing that someone would be offended.
It got me thinking on the subject of family and finances though. Money wasn’t something that was discussed around my house, and we were STRICTLY told not to talk about the family’s finances with other people, not even other members of the family outside ourselves (Mom, Dad). I find myself reacting the same way with my kids even, and still wonder why?
We are the Product of our Parents
Being raised by a family that doesn’t talk about money, influenced me to be the same. It’s only in recent years that I have tried REALLY HARD to be open with our money/finances with even the close family. I try to get the spouse involved with the bills, investments, etc (with varying levels of success) and I have started early talking to the kids about money and handling it. I’ve also let them know how the family is doing overall, and how much we have saved, invested, and such.
Not so with anyone out the family. I’ve talked about money a bit with my in-laws but they don’t talk about money (in detail) either. I’m not ashamed of what I do or make, I do pretty well all in all, so why should it be such a taboo to talk about it.
I think it has to do with perceived social levels. What I mean is that even though we’re all family, it gives everyone a means to ’stack’ others against themselves. "Do they make more than me? Then I must not be as good/smart/lucky as them. Do I make more than them? Then they must not work as hard/be as smart/be as lucky as I am!" Even in close families, people tend to stratify or compare themselves against others.
What makes it worse in families is that the more familiar you are with someone, the more flaws and imperfections you know about. Knowing that Uncle John had a drinking problem after college colors your perceptions of him for the rest of your life, even if he’s gone on to be an astronaut. Finances tend to be the same way. You remember the time that such-and-such had to go on welfare, or so-and-so came to you for a loan to make a house payment. Too many people let incidents like that color their memories of someone that should be special to them.
The Dog Eat Dog World
It’s human nature to be competitive, but not all competition is healthy. We in the U.S. over the last 20 or so years have let the acquisition of wealth become one of the most important aspects of our lives. Whether it’s through the fear of losing a job (and losing that income, which I will never be able to get anywhere else?!??) or the climbing up the corporate ladder to attain the lifestyle of the ‘beautiful people’ (I need the 35,000 sq ft house with the 34 bathrooms!). Keeping up with the Jones’ has become a cultural Olympic event.
When that competition filters down to influence even our kids (need for designer clothes, new car, ivy league college, etc) it makes them perpetually unhappy at some level that they aren’t living in the lap of luxury like they ’should be’ and somehow it’s the parent’s fault for not providing what every other kid on television seems to already have.
Competition has to be tempered with good sportsmanship, even in the financial arena. Just because someone makes less money, or spends it differently (or out and out squanders their money) doesn’t make them someone to revile. Too many people nowadays don’t know how to handle their money, and because finances are a double-nought, triple dog deep dark secret, they usually don’t have anyone close by to talk to about it until it’s too late.
What Can You Do?
I think it’s safe to say that you can’t just go out and mail your net-worth statements to the family at large, but you CAN start being a little more open when talking about investing and finances in general. If you’re knowledgeable about stocks, bonds, real-estate, or other financial matters, let it be known that you can be asked questions. You might not be the most expert person on the subject, but you can point others in the right direction.
Most of all, work on not being judgmental with your family!! Things happen. Life happens. Not everyone goes through life without having a major catastrophe happening, or doing something monumentally stupid with their own money. Remember "Let he who has never sinned, cast the first stone."
Have you fought with family members over money matters? You can air your story with us and leave a comment on your thoughts.
It definitely seems like some people use money as a way to make themselves feel superior. But even without money these people do it with houses, cars, jobs, etc….so removing one factor doesn’t make a huge difference.
My immediate family doesn’t talk figures but we do discuss money management. My grandfather on one side used to like to talk about his investment strategies. My grandmother on the other side sometimes does too.
In my extended family, I think there’s a desire for everyone to do well—and well doesn’t have to mean great jobs. Well means living up to our potential. Though some people feel more strongly that we can live up to our potential with great jobs than others do. I have one aunt who did very well in the corporate world (high on the IBM food chain) and another one who’s a piano teacher. But I don’t think either is jealous of or looks down on the other.
Pretty healthy dynamic.
Talking about finances in our family usually turns out to be some sort of “keeping up with the Joneses” exercise. We simply don’t do it anymore beyond generic statements about lowering debt, investing, etc.
It’s too bad, but it’s also the type of environment where everyone else wants to solve your problems for you w/o letting you do anything on your own, so even if we did reveal our debt issues…everything we’re doing to get out of debt would be wrong!
Oh the dilemma! *chuckle* We’re just determined to do it right, then maybe we’ll share things after-the-fact if anyone seems to need help or want advice.
Mr. Debtbeater’s last blog post..0% Credit Card Interest Offer – Floating My Largest Balance
Growing up I was told by my parents to NEVER tell someone what you earn. To this day I do not even know how much my parents earn, although I do know that they are at the higher end of the spectrum for “normal” non billionaire types. What we did discuss was how debt was bad, how interest will kill you, and why mom was not going to spend $70 on a pair of jeans you were just going to outgrow in 5 months.
Now, my parents, (my mother, actually) are always concerned with how much money *I* make. She wants numbers. She wants to know how much I spend on this or that. I always tell her I am doing fine. I do not want her sending me a check just because she wants to make my life easier.
Of course, when true emergencies come up, such as when my bank account information was stolen and all of my funds were drained by someone in Mexico City, I told her. I was distraught and crying and really just needed someone to talk to about the whole situation. Since I am single, the only person I felt comfortable discussing that with was my mother. She sent me a check with enough to cover the checks I had outstanding for bills. I paid her back. So, I think in some instances it is perfectally acceptable to discuss financial matters with family.
But day to day in depth finances? Not really. General speaking, sure. But I never feel comfortable telling my parents exactly how much I make. I do not know if it is because I know I do not make as much as they do or if it is because of certain life choices I made at a younger age which they did not agree with that puts me on the prideful path of “I can make it on my own… I don’t need you to take care of me… I will show you EVERYDAY that YOU were wrong and that I CAN do this!”.
I guess there are a lot of reasons people do not talk about money. And some of them have nothing to do with keeping up with the Jones’.
Katie’s last blog post..A friend in trouble
I still have a hard time understanding people who have no qualms talking about their finances. My bf, for example, loooves blabbing to his whole family how I lost my job, how we’re barely covering expenses, how much debt we’re in, and generally how crappy we’re doing overall. We’re not asking anyone for assistance, so it seems pretty pointless to negatively color their perceptions of us, as you say.
I’ve been out of work for 2 months to the day and I haven’t told my own mother. She’s not in a position to help us anyway. Basically, I only want to share good news. The rest is unnecessary.
Hops’s last blog post..Pull out some hope for me
@Everyone.
I’m glad it’s not just me and my perceptions about family and money. These comments seem to indicate that there’s a lot of families/people out there that have problems with revealing too little, AND too much information to their families.
@Hops,
Hope you find another job, just hang in there and it’ll happen.
Here’s something I’ve run into in the past – My wife’s parents are very well off, living in a million dollar home, semi-retired, traveling all year round. My wife is used to their standard of living, so when she sees our little house, our savings, and monthly bills, by the standards that she’s used to she thinks we’re poor.
By no means are we poor – we have no debt, own our house, and have a decent amount in savings – but still, since she is used to a different standard of living, she thinks we aren’t doing well. Because of that she shares with her mother who now thinks we’re barely scraping by, and ends up sending us checks and paying for trips that we don’t really need. Because of this, we constantly feel like we need to be indebted to them, and it ends up causing issues.
Family, money and perceptions of how you are doing can be a real problem. We’re working through it, and I think it’s been getting better, but it can sometimes be a real pain.
pete @ biblemoneymatters’s last blog post..Money Management Made Simple – Enveloping
I’ve learned to just keep my mouth shut about any kind of figures.
I used to be open and honest, if someone wanted to know, I’d tell em. Now, if they’re persistent, I’d just give ‘em a range.
I noticed that while they seem not to judge my income (which is much, much higher than theirs, usually) or me, that in future conversations it will get brought up. I will get served this “you think you’re holier than us” kinda attitude on a silver platter, and I just got tired of hearing it. Or the ever popular “You don’t know what it’s like for us” when we all grew up together, with the same backgrounds, and I just happened to make a couple different choices later in my life.
So I just let it go now. There’s no reason to discuss figures.
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