Breaking Money Silence: Helping clients understand money taboos and talk more openly about finances

The following is an excerpt from “Breaking Money Silence: How to Shatter Money Taboos, Talk More Openly About Finances, and Live a Richer Life” by Kathleen Burns Kingsbury (Praeger, 2017). Ms. Kingsbury is a wealth psychology expert and founder of KBK Wealth Connection.

Almost half of Americans say the most difficult topic to discuss with others is personal finance, and that they would rather discuss death, politics or religion. Take a minute to let that information sink in. Many people would rather discuss dying than finances!

Turn on the television and within minutes you can find a reality show where the stars are discussing sex or drugs, two formerly taboo topics. Go to Facebook, Twitter or YouTube, and you can learn more than you care to about the food intake, relationship status and political views of your “friends” and “followers.” But ask someone you love about money and wait for the silence to set in.

Even couples who are intimate life partners have trouble talking about finances. One of my girlfriends joked, “Husbands should never know what you spend.” She laughed, but the underlying message was clear: It is best not to share financial information, as you may just end up in a fight. It is hard to believe but many couples don’t even know how much their significant other makes for a living. A survey by Fidelity Investments found that four out of 10 people could not correctly identify their partner’s salary, and 10% of those who did guess were off by $25,000 or more. Twenty-five thousand dollars is often over half of what the average American earns. We are supposed to get married, have sex and give birth to children, but not discuss financial matters with our partners. Richard Trachtman, a pioneer in the field of money psychology, notes, “It is the rare couple that marries these days without having at least some sexual knowledge of each other. It is quite common, on the other hand, for couples to marry without knowing anything about each other’s assets or debts or discussing assumptions about who will earn the money, how it will be spent, for what or how these decisions will be made.” As crazy as it sounds, this is the pact we have made, and it’s a bad one.

Vow of silence

This vow of silence negatively impacts our relationships, our children and our families. It gets in the way of planning for a secure financial future. It fuels conflict and misunderstandings. It keeps women underpaid, and families from successfully passing on wealth. It contributes to the financial literacy crisis in this country, and the fact that many of our elderly live at or below the poverty level. Yet, we remain quiet.

Money is a complicated thing. In its purest form, it is a tool for commerce. It was created as a way to easily exchange goods and services. However, money means so much more. It is a symbol of love, respect, self-worth, freedom and power. It can be used to control, reward, penalize or entice. Having wealth is thought to bring a person great happiness.

Conversely, living without it often brings great misery. Pursuing wealth can be admirable or shameful depending on whom you ask. Some believe that forgoing financial reward is noble, while others see it as foolish. For something that was designed to simplify trade, money means many things and is emotionally complex.

What does the word “money” conjure up for you? Responses vary from “comfort” and “security” to “stress” and “necessity.” It is used as a measure of our self-worth and power, while at the same time hiding our fear and vulnerability.

I think part of the reason money talk is taboo is that internally many of us feel so conflicted about what money means in our lives, so it becomes difficult to put it into words. It is hard enough to share our emotions with others, let alone explain our feelings when they are all jumbled up. This is why understanding your own relationship with money is a vital part of breaking the money silence in our life. A money mindset is defined as a set of beliefs about money and its purpose in your life. This mindset influences your financial habits and your ability to talk about money with others. Until you put the pieces of your own money history together, it is almost impossible to explain your financial decisions and beliefs to someone else.

Another contributor to our collective silence about money is the barrage of mixed messages sent by our consumer-driven culture. One minute you are told that buying material goods increases your happiness, sexiness or social status. The next minute you are scolded for carrying too much credit card debt or not saving enough for retirement. I don’t know about you, but to me these messages are as clear as mud, and change with the wind.

Where did this money silence originate? Well, it is at least partly a long-standing American cultural tradition inherited from our British founders. The British aristocracy found it tasteless to discuss finances, and while America’s founding fathers decided to protect their freedom of speech, they forgot to include the freedom to openly talk about money in the U.S. Constitution. Hence, the legacy of money silence followed them, and all of us, to the new land.

Some believe that wealthy families started this custom as a way to protect their fortunes. If it’s rude to discuss money, then aristocrats don’t have to disclose their true net worth or how they use their wealth. This custom keeps other families of lesser means in the dark, and thus the family’s wealth out of harm’s way. If you don’t know how much the Jones family really has, then it becomes harder to steal from them.

A 2014 survey by Wells Fargo revealed the taboo against talking about money is alive and well. In this national online survey, over 1,000 adults between ages 25 and 75 were asked to identify subjects they found most uncomfortable to discuss. Forty-four percent of Americans surveyed found that talking about personal finance was the most challenging topic. Other uncomfortable subjects included death (38%), politics (35%) and religion (32%). It seems that almost half of Americans would rather talk about their mortality than their financial habits! The silver lining to these findings is that discussing politics and religion used to be off limits, but these subjects seem to be less taboo than in the past. Maybe there is hope for more open and honest money talk after all.

The United States is a melting pot of cultures from around the globe, so it is unfair to just point a finger at the British tradition. The reluctance to talk about money seems to be a multicultural phenomenon. As people immigrate to this country, they bring their own money taboos with them. When a group of educated 20-somethings representing 18 countries was asked if it is OK to inquire about someone’s salary, the resounding answer was no.

From the Belgians to the Japanese, everyone could concur it’s generally considered rude to ask how much money someone makes. The Dutch, Belgians and French confirmed it went against etiquette and was generally “not done.” The Brazilians said money is regarded as a strictly private affair. While admitting it’s considered rather rude, the Israelis said the subject often comes up in conversation in their culture. The Thais all agreed it was taboo to bring it up.

Passing down wealth

What about other types of financial conversation? Are they taboo, too? If you look at how families struggle to successfully pass down their wealth from one generation to the next, the answer would be yes. You see, there is a proverb in wealth management that states, “Shirtsleeves to shirtsleeves in three generations.” The first generation creates wealth, the second generation enjoys wealth and the third generation loses wealth. Interestingly enough, this proverb is found in almost every culture. In Japan, it is translated as “from rice paddy to rice paddy.” In Italy, it is “from stall to stall,” and in England, “from clogs to clogs.” It seems the lack of family communication about money is a global issue, and living in a culture of money silence is a fairly universal experience.

Breaking a social taboo is never easy, but it is possible. A few decades ago, you would not hear two people publicly discussing their religion, sex life, sexual orientation, drug and alcohol use or political views. Today it is more commonplace to hear and participate in these conversations. Yes, there are some people who still find these discussions unpalatable, but many more, including the majority of the millennial generation, do not. What transpired to allow these formerly forbidden subjects to be destigmatized, and how do we replicate this process to break through money silence once and for all?

I believe taboos are broken when enough people decide that the risks associated with keeping silent are too high. For example, when parents realized that not talking about sex with their children placed them at risk for diseases and unwanted pregnancies, this formerly forbidden topic became a conversation that responsible parents had with their teens. The question is no longer whether we will talk to our kids about sex, it’s when.

Ruffled feathers

Often a taboo is broken when a handful of people revolt against the idea that silence is golden. They decide to speak their minds. Feathers get ruffled and those involved in the grassroots effort are criticized. Then the media catches wind of the story and a few people talking about a topic turns into a few thousand, then a few million. Add the power of social media and millions turns into billions.

Just look at the 2016 presidential election. Politics, a historically taboo conversation topic, became mainstream fodder. Facebook and Twitter lit up with users sharing their views. Friends and families talked more openly about their ideas at the dinner table. And it became clear that Americans had many issues to work out.

Breaking money silence will take the same grassroots-level efforts. It requires you to take a stand by daring to speak up and ask someone in your life about his or her relationship with money. It involves the public’s asking their financial services professionals to explore the emotional side of money as part of their services, and reassurance that helping people communicate about money is as valuable as the technical aspects of their work. It requires financial advisers to embrace the human side of finance and empower individuals, couples and families to break money silence in their lives. Why make the effort? Because there is a financial literacy crisis in this country and money silence fuels it.

A recent global study found that only 57% of Americans passed a basic financial literacy test. The test posed questions on four main topics: risk diversification, inflation, simple interest and compound interest. According to the researchers, “a person is defined as financially literate when he or she correctly answers [questions on] at least three out of the four financial concepts described above.” These scores put Americans at 14th place in the world on financial literacy, with Norway, Denmark and Sweden tied for first with 71% of their citizens passing the exam. These findings suggest that a large percentage of Americans do not possess the basic financial know-how to enable them to make sound borrowing, savings and investment decisions. This is a depressing statistic that doesn’t seem to be getting better with the next generation.

According to an annual survey by Money Matters on Campus, “On average, freshmen at four-year colleges could only answer about two out of six questions correctly about topics like the right amount of money to set aside in case of a financial emergency, the conditions placed on student-loan borrowers and how long a late payment remains on your credit history.” If that is not a financial health crisis, I don’t know what is.

We do see some efforts being made to address this problem by organizations such as SaltMoney.org, the National Endowment for Financial Education and the Jumpstart Coalition for Personal Financial Literacy. But what is missing from the equation is the widespread involvement of couples, families and financial advisers. You and all the other readers of this are the individuals who can make a difference in the fight against the taboo against talking about money. By examining your own relationship with money and learning the skills to effectively talk about financial matters personally and professionally, you will make an impact. Then take it one step further and use social media to spread the word, and turn the actions of a few into a movement of many. Tweet about it on Twitter using #breakingmoneysilence. Share it with your friends on Facebook, or post a picture of yourself engaging in a money conversation on Instagram.

Advisers, you can teach clients these skills and provide a safe place for couples and families to practice these conversations. Together, one by one, we can start a revolution and end money silence for good.