How to have productive conversations about wealth with your family for Talk Money Week

Historically, an individual’s finances might have been somewhat of a taboo subject. It was often frowned upon to openly discuss your salary in the workplace, or bring up wealth in casual conversations with friends and family.

Interestingly, this is no longer the case across the board. According to Virgin Money, 56% of Brits feel comfortable discussing money with their friends. Furthermore, 38% of people also think that we’ve improved at talking about wealth in general, compared to five years ago.

This may well be in part because of initiatives such as Talk Money Week, an annual event hosted by the Money & Pensions Service that encourages people to talk openly about their finances, from pocket money to pensions.

Running from 4-8 November this year, Talk Money Week might be a reminder of the importance and value of speaking openly with your family about money.

While this all sounds good in theory, it can be difficult to put into practice. Broaching the subject of finances can be difficult, especially if you’re not sure where to start.

So, for this year’s Talk Money Week, find out a few ways to have constructive, meaningful money conversations with your loved ones. From ensuring that your children and grandchildren develop good relationships with money, to fostering an open environment in which everyone talks about wealth, there are different techniques for discussing money with all members of the family.

Start talking about money from an early age

Although we never really stop learning as we go through life, it’s thought that our relationship with money is informed by some of our earliest experiences. In fact, a 2013 study by the University of Cambridge and published by the Money Advice Service shows that our financial habits are largely established by age seven.

So, it’s worthwhile starting conversations about money with your children or grandchildren from as early on as possible.

Very young children might benefit from learning through play, using games where they act as someone buying or selling something and having to count out the money they use.

As they get older, many board games are great for having conversations about money, as they can also show the practical application of wealth in enjoyable formats. From Monopoly to The Game of Life, you’ll no doubt be able to instil positive financial habits by introducing these games to your child.

Similarly, there are countless books written about money that are deliberately geared toward children. For example, Why Money Matters by Deborah Meaden is purpose-written to help children aged six to nine learn the financial ins and outs.

More broadly, it’s important to be open with them about money. Rather than allowing it to become a taboo subject as it has been in the past, create an environment in which they feel comfortable asking questions, and empower them with knowledge by being transparent about your own finances.

These conversations and activities could set your children up for a positive financial future.

Have conversations across generations of your family

Of course, while talking about money with young children is important, it’s also key to have these conversations across generations. That includes continuing them as your children get older and enter adulthood, as well as going up the generations with your own parents.

As your children become teenagers and young adults, it’s an opportunity to introduce them to the financial responsibilities they’ll encounter for the rest of their lives.

There are many key milestones when you might have this chance. For example, you could initiate such conversations when they:

• Buy their first car. Depending on whether they buy it outright or choose a payment scheme, this is a hands-on way to teach them about savings or credit. Similarly, with tax, insurance, and fuel to include, it’s also a practical way to show them the importance of budgeting, and having to choose between “wants” and “needs”.
• Go to university or move out from home. Now that they’ll be responsible for their own wealth, you can remind them of the importance of budgeting and using their income responsibly.
• Get their first job. Alongside how to manage their income and budget with it effectively, being in the workplace for the first time presents the chance to discuss future planning and pensions.

The crucial point to remember when discussing wealth with children of this age is to ensure you only seek to inform and ask questions, rather than tell them what to do. You want to give them the independence they’ll need for the future, as well as keep them engaged and not make it feel like a lecture!

At the other end of the spectrum, it’s well worth keeping an open dialogue with your parents.

You may well have wealth management knowledge that could benefit them, and so fostering a relationship with them in which you all readily discuss money can be helpful for everyone involved – they’ll have years of experience that you could learn from, too.

To do this, it can be effective to start by telling them what you’re doing with your wealth before asking about theirs. That way, they can start sharing when they’re comfortable, rather than trying to force them to open up to you.

As hard as it can be, it may also be useful to try and discuss inheritance and how their wealth is organised as they get older. While this is often an emotional conversation, it’s one that’s worth having before it’s too late, so you know what to expect when the time comes.

Approach difficult conversations with empathy and from a place of understanding

It’s inevitable that you’ll have difficult conversations about money during your lifetime. Whether it’s with children, your parents, or perhaps even more likely your spouse or partner, at some point you won’t see eye to eye. In fact, according to Aviva, 26% of people in couples say they argue about money every week, with 5% doing so every day.

When this happens, it’s worth first taking a deep breath and potentially even walking away for a moment if emotions are running particularly high.

Then, when you’ve had a chance to take stock, approach the conversation with empathy and a goal in mind. It can sometimes be worth writing an agenda for exactly what you want to discuss, keeping the conversation focused on the issues at hand.

From here, it’s sensible to start by listening to what’s happening and all the concerns, before then trying to problem-solve. This ensures that everyone involved feels heard, and can then join in the process of finding solutions.

Remember: at the end of the day, you’re all on the same team. Make sure that everyone knows you’re working towards the same goals, and be as collaborative and respectful as you can.

Bring your family members to your financial planning meetings

It can be hugely powerful to bring your family members along to meet your financial planner, especially if you’ve struggled with difficult conversations in the past.

A financial planner can explain complex concepts in simple terms to you and your family members, demystifying certain money matters. They can also mediate disputes, providing an objective voice of reason to help you navigate those trickier discussions.

Above all else, your family members can see the value of financial planning. Whether you want to encourage your children to seek professional advice, or help your own parents secure their financial future, bringing them along to your meetings with a planner allows them to see how financial planning works and why it could benefit them.

Get in touch

If you’d like help facilitating money conversations in your family, please do get in touch with us at Caliber Financial Management.

Email contact@caliberfm.co.uk or call 01525 375286 to speak to one of our team. We’re more than happy to help.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The Financial Conduct Authority does not regulate estate planning

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

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