Are you planning to have “The Talk” with your family about money? Discussing financial matters can be sensitive, but it’s also crucial for ensuring everyone’s wellbeing and future security. So we’ve got some suggestions to help prepare you for these important conversations.
The importance of talking about money
According to Werner Liedtke, Interim Commissioner, Financial Consumer Agency of Canada, “Having conversations about money with people you trust can build financial confidence and open the door to positive financial outcomes.”
Whether it’s planning for the future, managing debt, or simply understanding each other’s financial goals, open and honest communication is key.
Preparing for the conversation
- Choose the right time and place: pick a quiet, relaxed moment to bring up financial topics.
- Set a positive tone: Approach the conversation with empathy and a non-judgmental attitude. Make it clear that you are there to support and help, not to criticize or take control.
- Be clear and specific: Have a clear idea of what you want to discuss and why. Whether it’s a general check-in or a specific concern, being specific can help keep the conversation focused and productive.
Talking to the older people in your life
Whether it’s your parents, grandparents or whoever, it can be easy to lose track of your finances once you stop working and having a regular income. That’s why it’s important to make sure they’re still actively involved in their personal financial planning and to let them know they can turn to you for help and advice.
Start by assessing their financial situation: This might involve discussing their income, expenses, savings, and any debts they have. Be respectful and patient, and let them share as much as they are comfortable with.
Discuss their financial goals: Talk about their short-term and long-term financial goals. Are they planning to travel, make home improvements, or have any other significant expenses? Understanding their goals can help you provide relevant advice and support.
Check for scams and fraud: Older individuals are often targets for financial scams. Ensure the older people in your life are aware of common scams and know how to protect themselves. Encourage them to verify any financial requests or offers they receive and to seek advice if they are unsure.
Offer assistance with technology: Many financial services and tools are now digital. If the people you’re speaking to are not tech-savvy, offer to help them set up online banking, budgeting apps, or other tools that can make managing their finances easier and more secure.
General tips for family financial conversations
- Don’t wait until a crisis arises to talk about money. Regular, ongoing conversations can help build trust and ensure everyone is prepared for any financial challenges that may come.
- Share your own financial experiences and challenges. This can help create a more open and supportive environment where everyone feels comfortable discussing their financial situations.
- Avoid using language that might make someone feel guilty or ashamed. Instead, focus on solutions and positive outcomes.
- If the conversation becomes too complex or if you need more detailed advice, suggest consulting a financial advisor. Professionals can provide unbiased, expert guidance that can benefit the entire family.