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How to Talk About Money With Friends

Who here loves to talk about money with friends? To be honest, that’s one of my favorite things to discuss with anybody, but there are some times when money talks with friends can get a little dicey. Money may not be quite as taboo a subject as religion or politics, but it’s definitely up there on the list of potentially awkward topics! 

Tough Money Talks With Friends

I’m sure you can think of your own, but here are some common difficult money issues:

  • The cost of activities with friends
  • Splitting the check
  • Major celebrations (especially weddings)
  • Lending money to friends
  • Talking about salary
  • Offering financial help

Let’s dive into each of these with some tips on how to talk about money!

Activities with friends (dinners, drinks, entertainment)

We all spend some of our free time hanging with friends. It’s easy when you can all afford the same price points, but that’s not always the case.

Let’s say one friend wants to do something completely out of the other’s price range. This will require straight talk—if you’re deep in a debt-payoff phase and your friends pick a restaurant that’ll set you back $80, you may need to opt out. 

Related: What Debt Should You Pay Off First? (Highest Interest? Credit Cards?)

You can suggest more frugal activities, but if the others want to spend their money, don’t push the issue. These friendships might not last if you’re uber-frugal and they’re big spenders, and that’s okay. 

how to talk about moneySplitting the check

Okay, I admit this mystifies me. When a group of friends goes out to dinner, why would they equally split the check among everyone? Unless it’s a place with a set price per person, this makes no sense to me. (Reminds me of a Friends episode at a restaurant.)

Some people want to split the check equally “to keep it simple.” Well, it’s not that simple if you’re ordering a side salad and water while everyone else gets surf-and-turf plus fancy cocktails. 

In my friend circles, everyone just pays for what they order. But if you’re unsure, let your friends know at the beginning of a dinner out that you’ll want to keep checks separate. That way there’s no confusion when the bill comes. 

Major life celebrations

Weddings are the main one of these big life events that can cost a lot of money. When someone is getting married, they’ll ask friends to be in the bridal party. And if the bride/groom have more expensive tastes than the bridal party, watch out! 

Learn how to talk about money in these situations.

If you’re the person standing up for the couple, think carefully about whether you want to take on the financial obligation. Talk to them about how much they expect bridal party costs to be before you agree.

This is typically more of an issue for the ladies, if a “bridezilla” situation comes up. When your friend asks you to be a bridesmaid, consider all the potential expenses. How much are you willing or able to spend? Let your friend know honestly if you don’t feel comfortable spending above a certain amount for wedding festivities. 

Related: Getting Married on a Budget? How to Throw a Wedding for Under $6K

Lending friends money

Oh, boy. The idea of lending friends money is such a charged issue. If you’re considering asking to borrow money from a friend, watch out! This kind of thing has ruined many friendships. 

When you’re the person whose friend is asking to borrow money, you want to tread carefully as well. Of course, you probably want to help your friend out, and the reason they’re in need might be totally legit. 

But loaning money to friends is risky. You may be tempted to keep it casual, without a contract, and then they may not pay you back promptly if at all. The longer you wait for repayment, the more your resentment will grow. 

A good rule of thumb when lending money to friends is to loan no more than you’re willing to lose. You can’t be sure someone will pay you back.

Either that or just give them the money and tell them it’s a gift. No strings attached.

If they need a larger amount of money, direct them to a bank or official lender instead. This way, they can learn how to borrow money without jeopardizing your friendship. 

Salary talks

This one has traditionally been a topic to avoid. But it’s becoming more popular now to share salary numbers with friends. When you talk about money in this concrete way, it can be beneficial but not easy.

You might ask a friend how much they make if they’re in the same industry as you. Explain that this could help you in future salary negotiations (which is true). 

Salary information isn’t always public knowledge. More open salary discussions can help close the gender wage gap and other inequities due to race or other issues. 

When we talk about money, specifically our salaries, we can help empower those who traditionally make less. (Hearing that someone in a very comparable title earns $20K more than you can be very motivating!) 

Offering financial help

If a friend offers to pay your way or give financial advice, try to take it as a kind gesture. And if you want to help a friend out, be mindful of their feelings. You don’t want to offend them. 

Try simple, low-cost ways of helping. You could give them a great finance book or send them to a favorite financial podcast.  When you talk about money in terms of things you’re learning, it comes across as a friend helping a friend. 

General Guidelines on How To Talk About Money With Friends

  • Be honest.
  • Use kind, non-judgmental words and tone. 
  • Don’t give in to peer pressure.

Figuring out how to talk about money is difficult for a lot of us. Our finances are so emotional. People can feel fearful, judged, proud, confused, and many more emotions wrapped up in their money. 

The key to successful money conversations with friends is honesty. When friends want you to spend more than you want to, tell them openly. Don’t let yourself be pressured into spending exorbitant amounts on things you don’t value the same way. 

Keeping your language non-judgmental can go a long way, too. Rather than saying “that’s too expensive,” you can stick with “that’s not in my budget.” Wording it the second way avoids telling your friend you think they spend too much on x, y, or z. 

We should all talk about money more in our everyday lives, with friends as well as family. Money is a huge part of our lives that we can’t ignore. By being honest and non-judgmental, we can open up valuable conversations with friends that could benefit all of us. 

How about you? Do you talk about money? Or do you avoid it at all costs?

Battle of the Mind Get Out of Debt Money

AUTHOR Kate Underwood

Kate Underwood loves reading, talking, and writing about all things in personal finance. She made the switch from her high-school teaching career a few years ago to become a full-time freelance writer and editor and can be found at kateunderwoodwriter.com.

6 Comments

  1. Derek, your site has far more information than it used too, and more relevant, thank you,

    Thank you,
    Paul

    • Sure does! I just want to help. Keep coming back and reference it all, dude! You won’t regret it!

  2. The splitting the check thing is very situational. I go on some annual trips with a group of multimillionaires. We were all former corporate execs, doctors or successful business owners and paying an extra fifty dollars over our share for an expensive dinner check split equally is an insignificant cost. It would be like trying to pay your buddy fifty cents for the gas because he gave you a five minute ride to work. Literally just not worth the effort for a group of independently wealthy people. And it is a lot easier on the restaurant staff. However if you are in your accumulation phase of life and this is a weekly event, then yeah, split it accurately. Plus in that situation its crazy to penalize the light eaters and boorish to be the guy that orders steak and lobster when everyone else is having soup and a salad for dinner, unless you cough up your fair share. As far as sharing salaries with friends, that might be easier in a big metro area. As far as sharing pay, that might have been awkward in our small town. If I told one person then it would be the same as putting it on a billboard sign on main street, everyone would know tomorrow. I only shared that with my out of town friends, and only a few of them. As far as coworkers, I was the boss so I already knew what everyone else made. The other thing I figured out about my money opinions was that nobody wants to hear money advice from the big boss. He doesn’t understand “my” life because he’s rich. So I just kept my mouth shut unless someone asked my opinion point blank.

    • All great points, Steveark. It might be time for you to write a post on here! Lol! 🙂

  3. I’m currently in the “give a friend a loan” situation. They needed much more than I was comfortable with giving, but we worked out a lesser amount so they could take care of some immediate needs. We also did not sign anything legal or binding. His first, of 6, payment is due by the end of this month, I’ll check back in with you and let you know if I get any of my money back. In the meantime, what advice can you give me for loaning money to friends in the future?
    Thanks!

    • Hi Tim! Loaning money to friends is tough. If they don’t repay, it can really strain the friendship.

      I don’t loan money to friends. I only give them money. This way there’s no master/servant experience. Just me giving some friends some help that will hopefully get them through their tough times!


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