Afford Anything - How to Talk to Friends about Money, with Erin Lowry

Episode Date: February 3, 2021

#298: Money conversations with friends, family members, or significant others are unavoidable. Most of us dread these conversations - they’re awkward, heated, or draining. Erin Lowry, author of Broke Millennial Talks Money, shares tips and scripts for tactfully setting financial boundaries and expectations without drama. If you’re anxious about being in a wedding, splitting the tab with friends, or asking your siblings about taking care of your parents, this episode is for you. For more information, visit the show notes at https://affordanything.com/episode298 Learn more about your ad choices. Visit podcastchoices.com/adchoices

You can afford anything but not everything. Every choice that you make is a trade-off against something else, and that doesn't just apply to your money. That applies to your time, your focus, your energy, your attention. Anything in your life that is a limited resource is something that you need to manage because saying yes to something means that you are implicitly saying no to other opportunities. Everything has a trade-off. And that opens up two questions.

First, what do you want to focus on? What matters most? And second, how do you focus on that? How do you align your daily decisions in order to reflect that? The what and the how. And really, at the core of both of those questions is the why. And that's what this podcast is here to explore. My name is Paula Pant. I am the host of the Afford Anything podcast. And today we're going to talk about how to have awkward money conversations with friends, with family members, with significant others, with coworkers. These types of conversations are unavoidable, and most of us dread having these conversations.

They're awkward, heated, or draining, or all of the above. Aaron Lowry is the author of the Broke Millennial book series. In her third book in this series, Broke Millennial Talks Money, she shares tips and scripts for tactfully setting financial boundaries, whether that means responding to a friend or family member who's asking for a loan, whether that means figuring out how to split the tab at dinner, or whether that's one of a myriad of other ways in which in our day-to-day lives, we talk about money,

even if we don't actually use the word money, we implicitly talk about money when we're deciding which restaurant to choose. We're implicitly talking about money when we invite our friends on a weekend trip. So how do we navigate that? In this upcoming interview with Erin, we start out soft, And then we go into very hard conversations.

So we start off with the more approachable light conversation around, hey, how do you split the bill? What do you do if you're invited to be a bridesmaid and a wedding? And you have to pay for the dress, the bachelorette party, the bridal shower, the destination wedding. We start out with conversations around that. And then as this interview progresses, we eventually lead to, towards the end of the interview, a conversation around how do you discuss? with your siblings who's going to take care of your aging parents. So that entire range of financial conversations is what Erin and I discuss in this interview,

starting right now. Here she is, Erin Lowry of the Broke Millennial Book Series. Hi, Erin. Hi, Paula. How's it going? I'm pretty good. How are you? Oh, I'm excellent.

You and I have been friends for a while. Have we ever had an awkward money conversation? I don't think we have. I also, I don't know how awkward it would be for us because we're both pretty frank about finances. Yeah, exactly. We both talk about money all day, every day in our work. And so money is not a faux pa topic. Right. And I, it's so funny writing a book about talking about money because I get asked those kind of questions a lot. I'm like, you know, I have this great escape clause where I can pretend that I'm either doing research or be like, oh, I just came across this topic. What do you guys think about XYZ? Or if I just stick up for myself with a group

dinner bill situation, people are like, ha, ha, her brand's called broke millennial, and we can kind of laugh it off. Let's talk about money conversations with friends. We'll start there, since you and I are friends. And let's go to the awkward dinner conversation where you're at dinner with a bunch of people in non-COVID times, the bill comes and there's the awkwardness of how to split the bill. The rest of the group maybe wants to do it one way, but you think that's sort of unfair. How do you navigate that kind of conversation? If you've waited until the bill has already hit the table, it might be too late. And I say that a little facetiously. You can, of course, still stand up for yourself. But part of this is laying a bit of groundwork ahead of time and playing

a little bit of defense with your friends so that when the bill comes, there's already been a discussion and an understanding, particularly if you're on a different kind of budget than they are. For one, it might have made more sense to opt out. So that becomes part of the question. Even if it's your best friend's birthday dinner, if they're going to someplace that is just even the salad in the water is outside of your budget or just not tenable for you right now, that needs to be an earlier conversation. I love you. I want to celebrate your birthday, and I don't want you to have to compromise where you're going. So I do think, of course, you should go to this restaurant.

How about I meet you for a nightcap later? Or how about I cook you dinner later this weekend? Or provide some other options. That counteroffer is always a very strong strategy if you're going to say no to someone. Now, if you're like, listen, it's my best friend. I want to do this. Then it's also having a conversation either early with the other people that you know are there. hey, I understand people might want to split the bill evenly. I got to be honest, I have a hard

maximum at $40. So that includes tip and tax and paying for her. I can't do more than 40. I will make sure that I order a modest dinner, but I just want to have that conversation now. Right. Or you stand up at the dinner table. I love this line from Melanie Lockhart, who talks about this idea of which feeling is going to be worse, the potential embarrassment you feel in the moment or the resentment that you might hang on to for days afterwards. And I really loved that framing. We're like, listen, I have definitely been in that situation where I had to advocate for myself.

I was at a birthday dinner. I only knew the birthday girl. She picked a very expensive Mexican restaurant. I ordered the cheese cassidia in a water. I had done my research ahead of time and the bill was still going to be 80 bucks because of everything everybody else ordered. And I was like, I can't. I can't do that. I cannot afford that right now. And it was a little embarrassing, but also,

I loved and trusted her, and I didn't really care about anybody else at the table because I didn't know them, and I probably wasn't going to see them again. Right. Yeah. So if it gets to the end of the dinner and it's time to advocate for yourself, it's still worth doing it so that you don't hang on to the resentment afterwards. But the best case scenario is to bring it up in advance. And to set some other options, you know, meeting afterwards, meeting before, but kind of bowing out for the actual splitting the dinner bill dance. The other thing to think about is if you do advocate for yourself, there's probably one or two other people at that table who are about to let out a big exile because they felt the same way. And then they'll back you up because you broke the ice and

said something first. Does it always happen that way? No. But oftentimes there's at least a couple other people are like, yeah, let's just pay for what we ordered. Thanks. Right. So they're the people who are glad that you're the one who is brave enough to speak up. Yes, that you are willing to take on that burden. But it is just really critical to think about the fact that you care more about your money than anybody else. And it is so easy to let other people spend our money. And it is as simple as those dinners that feel like not that big a deal. It happens here and there. And one of the ways you can also play defense in your own life is to create a friend fund. Every paycheck, put a little money aside so that you can indulge in certain ways within reason when these kind of moments come up. And you can just say yes. And you

don't have to make it this whole reconfiguring your monthly budget for yourself. So that's one way to also just in your own personal financial life play a level of defense. But there are so, many ways with friends, with family members, even with coworkers, with our partners, that people ask us to do things that kind of ends up with them spending our money. I'm looking at wedding season as a big offender of this, but, you know, what kind of bridesmaid's dress are you being asked to buy? Do you have to pay for hair and makeup? What are all the events that you have to go to? It's hard to advocate for yourself, and it's very easy to just say yes so that you don't have to deal with the awkward conversation, but then feel a lot of resentment about what's happening

with your money. Right. With regard to wedding season, what are some diplomatic ways to bring that up? Because, I mean, if somebody asks you to be in their wedding, that's a big honor. So you don't want to sound ungrateful, but at the same time, you have a budget reality. You need to be honest about that budget very early on with both the bride and then whomever she might be looking to to help plan other events. That could be as simple as I'm very excited to be a bridesmaid. However, I am a bridesmaid in two other weddings this season. And so because the wedding is out of town, I can only afford to do the wedding and either the bachelorette party or the bridal shower or I can really only afford to come to the wedding and I can't attend an engagement party, a bachelorette party, a bridal shower,

and the wedding. Like setting expectations for all of the events and what's that going to look like for yourself. Also, trying to set expectations around the dress, the hair, the makeup, the shoes, getting a sense of what she's going to want. And can I just remind people, you can say no. You do not have to be in somebody's bridal party. And there are tactful ways. I really love you and I cherish our relationship. But I just honestly, financially, cannot afford to be a bridesmaid right now. And I don't want you to feel like I am creating drama for you or you have to cater to my situation. So I will be there to support you, but I just cannot afford to stand up there with you in that way. Right. For a situation like that, would it be appropriate to also state some hard maximum?

I mean, when you were talking about dinner, you gave the example of one conversation you could have is, hey, I have a hard maximum of $40, including tax and tip. Could you do that with something that's bigger ticket, like a wedding? You definitely can. And you can also do that with, let's say, say that you're not the maid of honor and the maid of honor is handling planning all of the events. And I have known people who have been in situations where that person goes rogue and just book stuff without asking people. So that's another thing to upfront have a conversation about. Hey, overall, the whole wedding, including day of dress and all that, this is my hard budget. So just please keep that in mind when you start planning the other events that I either won't be

able to attend or I can only afford to contribute X amount. That's an important conversation to have early. I will be honest, though, this does not always go well. I have been the bridesmaid who did try to set limits with a bride, and we did not end up staying friends after that wedding. And it was hard, and I was young, and I could have certainly been more tactful, but I also did not anticipate the level of Bridezilla that she went. And at one point, she had picked a very expensive dress that then also needed alterations in tailoring. And she was trying to have a Bachelorette party at one destination, a bridal shower at another, and her wedding at a third. And I said, I'm not asking you to switch what brides have made dress you purchased or you want us to purchase, but I cannot

financially afford all of these events and this dress. So would you prefer for me to come to the bachelorette party or to the bridal shower. And I got a very condescending email back about how I didn't understand what it meant to be getting married. And I was like, yes, but I do understand what it's like to be a bridesmaid because this is not the first time I've done it and I'm in two other ones this year. That did not go over well. So it was wrong on both sides. I was not tactful in my response. The reason of setting that boundary stood and I also did not Kate. Like you, I cannot afford all of the things you are asking of me. I did not say yes. I was. I did not say yes, anticipating a $2,000 bill.

Right. So what is most important to you? And I think that's another thing, is trying to be amenable and compromising along the way, giving a choice of, I can only do two of these X number of things. What do you want me to be doing? Yeah, which then puts some power and control back in the hands of the person that you're speaking to. And that's true of, I mean, wedding seasons is just a low-hanging fruit of these conversations,

but that's true of so many different dynamics that we, have with people when we're trying to navigate awkward money conversations is, all right, of these options, what is most important to you? What we've talked about so far is playing defense and defending your money when you're at the dinner table and other people are trying to spend it or when you're asked to be in a wedding or asked to be, you know, involved in some type of a group event in which other people are are spending your money. To what extent when we're on the other side of the table, is it our job to be proactive and look out for our friends' money? I'll give you an example. I was at dinner

with a mutual friend of our, Stephanie O'Connell. We had the most beautiful example of a money conversation at the dinner table done right. So it was me, Stephanie, and it was a third friend of ours who I don't think you've ever met before. Stephanie and I ordered drinks. This third friend did not. And when the bill came, Stephanie and I proactively were like, oh, we'll pay for our own drinks. We realized you didn't order any drinks. We don't want to force you to split the bill three ways. And the friend was so like taken aback and so grateful that he was like, oh, no, no, no, I would be happy to. I'd totally be happy to split it three ways. And Stephanie and I were both like, oh, no, no, no, we don't want. So it was like each of us were advocating for the interests of the

other person. And it was just a really, really good experience for everybody. To what extent are we as friends responsible for doing that, you know, as at the dinner table or when we're inviting somebody to a group event? I wish that that was just the common courtesy way of handling things or one of the other options is, okay, if you want to split, that's fine, but how about I pick up the tip because I did have the bigger entree or I ordered the extra drink or whatever it is. We will see. as money conversations hopefully evolve and also with now having Venmo and access to all these other things where it's easier to pay people back, it might become a bit easier to navigate some of these chats. But the danger can also lie in trying to be too generous with friends because perhaps you earn more,

you know you earn more, or you're in a different stage of life and you're trying to, you think it's nice to take care of someone, but then it starts to read to them as, you know, do they think I can't afford this? Do they think I can't handle my money well? So in a situation that you described where, obviously, we ordered drinks, you didn't, great, we'll just pay for what we ordered. Please don't feel like you have to split the bill. But if it's a situation where you keep trying to pick up the tab for a friend because you think

you're doing the right thing, that also can lead to an awkward situation. Let's dive into that a little bit more. when two or more friends who have disparate income levels go out, how do they navigate the question of who picks up the tab and how consistent should that be? How much give and take should there be? A lot of it depends almost sort of like dating. It depends on who asked what we're doing.

And I say that because if you're the friend who earns more and you really want to eat at a particular restaurant and you really don't want to negotiate about it or compromise on it, you should be picking up the tab because you should not make it your friend's problem that you want to eat at this particular place. But then you should also be open and honest about that in the start. Hey, I just got great career news.

I really want to go celebrate at this particular restaurant. I really want you to be the person that comes with me, so I'm just going to pick up the bill so you don't need to worry about it. They might push back a little bit. You'd say, listen, I'm picking up the bill because I don't want to compromise on where we're going. So I'm going to cover it. Now, if it also just turns into a situation of you keep trying to pick up the tab as the

bigger earner, or if you're the friend who doesn't earn as much and your friend keeps picking up the tab, you can just be blunt at some point and say, this doesn't feel good for me. I appreciate what you're trying to do. But how about next time we just go to someplace that I can afford and I can pick up the tab and advocate? Now, you don't have to say it like that. I can afford. You'd be like, hey, I would like to pick up the tab next time. I'll send you some

options of restaurants that I think we would love. And then you just send stuff that's within your budget. It's the vulnerability angle of this is what gets hard. Being open with each other and honest with each other about this underlying fact that you probably both know to be true. If you're a public school teacher and your friend is an investment banker, there's no dis, like everyone knows, with the financial situation is here unless the public school teacher has a trust fund. We understand that the one person earns a lot more. Now, we don't know the backstory of maybe somebody has student loans and the other one doesn't and actually when it all plays out, the discretionary income is about the same.

Could that be a possibility? Sure. But on the surface, if you know that you're drastically out-earning your friends and you're trying to overcompensate by always paying for them, it will eventually become a problem. either because you're going to start to resent the fact that they let you do that all the time, or they resent you for acting like they can't afford the things that you're doing. And the only way through is to communicate, which I know sounds super hokey, but it ultimately is the answer.

You have to just acknowledge this huge elephant that's in the room that we all kind of try to be like, no, it's fine. We don't have to talk about it. No, we do have to talk about it because that's what's going to long-term preserve our friendships and relationships. We'll come back to this episode after this word from our sponsors. The holidays are right around the corner and if you're hosting, you're going to need to get prepared. Maybe you need bedding, sheets, linens. Maybe you need serveware and cookware.

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the type of communication that quickly escalates into fighting? Well, I guess that's the question is do you just keep fighting about it? Because then you're not communicating effectively, regardless of the relationship. A big part of that, too, is trying to figure out people's financial triggers. This is particularly rings true when you're dating someone or getting married. What is their relationship to money emotionally? Because that might be the reason that certain things keep escalating to a fight where you cannot understand why this is a big deal and why they keep acting this way about it. And perhaps

that's just because you don't know the backstory with money. Maybe something about this dynamic is triggering something they saw in their childhood with their parents. Maybe it has something to do with emotional trauma they have around money. You don't know. Like you have to ask. I think an important part, especially with fighting about money with whomever, is kind of asking, well, how do you relate to money? How is this making you feel? And you can be honest in a fight. Hey, I have to be honest with you. I do not understand this reaction. And I'm not saying that it's invalid.

If you could just explain to me why you feel this way. So I don't communicate with you like this again or that we can work through this. But I don't understand why you're having this reaction to me right now. A lot of it sounds like therapy, which it kind of is. Like a lot of this is therapeutic techniques for how to navigate through a tense financial stuff that comes up. And money causes fights in so many different realms of our lives. And on the surface, we might not be acknowledging that this is really a money fight. Sometimes it looks more like a values-based fight.

Sometimes it just seems like different stages of life. But it's often us getting territorial and or embarrassed about financial situations. We've talked so far about friends. We'll do a very, very minor pivot. it, does the dynamic change when the people in question are siblings or cousins? Yes and no. I think a lot of the language will remain the same. The stakes in certain ways can be higher.

If there is a tense family fight about something financial that can have long-term repercussions on even more people than perhaps if you have a fight with a friend, it also can tie in, especially with siblings, to long-term family dynamics and fights that resurrect from childhood or from early adulthood that you thought you had long since put to bed. Friendship dynamics don't normally play out quite in that level, but if you've been friends for a very long time, it could certainly happen. But the big thing, too, with talking to your siblings, even if you grew up in the exact same house, the exact same parents, learning the technically exact same lessons about money,

it does not mean you have the same relationships to money. Right. Right. And that is critical, acknowledging that just because you feel like your parents did XYZ, that was not necessarily your siblings' relationship to the situation. And you have to acknowledge that for them. And you cannot be dismissive. It's also difficult to when in-laws start to get involved. So other family dynamics start to come into play. You're adding more and more people to these discussions and figuring out how to communicate through all of that, especially if you are having conversations about who's going to care for parents as they age. And that's where a lot of old family dynamics can come back to a head or sibling resentment can come up. What are some tips for navigating these types of issues when the friendships in question, the people that you're going to dinner with or going to a weekend event with, are also coworkers or colleagues? And in particular, you know, a lot of the people who are listening to this are either part of the fire movement or just generally high savers. So many of the people who are listening to this might be in a position where they earn a similar amount as some.

of their coworkers, but they spend at a radically different level. And so when you go out with friends who are coworkers who are all make, you know, all have a sense of how much you're making because they're all making about the same, there can be that awkwardness in them knowing what you make and then them recognizing that you're not spending it. It's key to give context about your why. So explain what fire is if they're not familiar with it or tell them that you're aggressively trying to pay off debt or talk about what your savings goal is for the next couple of months, but to also ensure that it doesn't get presented as a, well, I don't value that.

I don't value going out to happy hour. I don't value getting lunch. And I say that because it's perfectly valid and fair if you don't value that. But saying it like that just sounds super judgmental about them valuing it. They are entitled to value that if they want. I value lattes. I think they're delicious. I budget for them. If somebody does not see value in that, that's fine, but it doesn't invalidate me wanting to go buy a latte. So the big, no matter what the dynamic, if we're talking friends, coworkers, family,

a huge part of this is just making sure that the way you set up your context and what you're going to say doesn't come across as, well, I think. think you're wasting your money, so I don't want to spend money that way. Instead, leading with, oh, I really appreciate the offer, but we are trying to hit X amount in savings or this savings rate or paying off this debt by the end of the month. So I'm going to opt out this time. Or I can come, but just for one drink, or whatever the alternative that you're going to offer is. Or, hey, I'd love to have you come over and I can cook a meal, whatever you want to offer. If you do want to offer, maybe you don't care. Maybe you don't care to socialize with your coworkers, which is also fine.

You just also need to consider potential ramifications in other ways. One of the things that I've talked about recently is a lot of times when folks ask what your biggest financial regret, the answer is like, oh, this debt or overspending here, not saving enough there. And for me, it has a little bit more to do with the money I did not spend. And I mean that because I said no a lot in my early 20s to mid-20s and in the interest of saving and going to earn instead of going and investing in relationships by going to the company happy hours or by going with my friends to certain concerts or events. And long term, if you keep saying no, people do stop asking. And for some folks, that feels like, well, good, I want them to. Which is just,

fine. But also it can be you waking up and realizing, yeah, because I have to rebuild a lot of friendships because I kept saying no and people stopped asking. And here I am without a tight community of people around me because I prioritized other things over investing in relationships. There does need to be a balance is what I'm saying. Now, is every relationship from my early 20s that petered out, were they going to be long-term friendships that I was going to have at 50? no, but there's also memories that didn't necessarily get made or events that my friends will still talk about to this day that I kind of wish that I had gone on. And that is something to consider is what is the payoff? What are you sacrificing and long term? Are you totally sure that that's worth

it? Or maybe you should have a friend fund or a fund money that you set aside so that sometimes you can say yes and often. I want to go back to something that you said earlier. When we were discussing siblings, you talked about how the money conversation with siblings goes beyond simply how you split the bill at a restaurant or how expensive of an Airbnb you stay in when you go on a weekend trip.

The money conversation with siblings can often have a work and responsibility component to it with regard to how you take care of aging parents, grandparents, the work associated with maintaining your extended family. How do you, at the risk of asking far too broad of a question, how do you begin to navigate those types of conversations? It starts by acknowledging whatever feels like the pain point. And that needs to get brought up first.

Maybe the pain point is you're worried mom and dad can't afford. to retire without financial assistance. You're not sure, but you're pretty confident that's going to be a problem. So what is that going to look like for the siblings? Can you financially afford to support them? Are you going to need your siblings to help? Can your siblings afford to contribute? And if not financially, are there other ways that they can help contribute? So starting to bring up whatever feels like the friction or the pain point in the dynamic in a way that's not, again, coming across as any sort of accusation, any sort of, I'm handling all this, you're not doing anything. You really want to bring it up before it gets to that kind of a point.

Because that can happen in family dynamics. It can feel like one person or two people are shouldering the burden and other people are not really providing support, whether it's physical, emotional or financial. So actually asking a sibling or another family member to sit down, tell them it's coming. I want to have a conversation about mom and dad's financial prospects in the future. I'm feeling a little stressed about it. I'm not sure how you're feeling, but I'd love to sit down and just have a conversation about it. So we can put our worries or thoughts on the table and see what happens. No matter the financial conversation that you're having, though, a key takeaway is that it doesn't have to get resolved in one sitting. I think sometimes we kind of

go into these hoping for a resolution immediately no matter what the problem is. Sometimes the first step is just acknowledging there's a problem and that's it. Like, hey, this is a pain point. I just want it out there. And then slowly continuing to have this conversation, it could be over weeks, months. Heck, sometimes it's years, but just allow it to also evolve as opposed to we've addressed it and we're going to solve it right here in this one dinner that we're having. It strikes me as I hear the description of that conversation, that the conversation needs to be a blend of emotional validation as well as logistical planning. Does one have to preclude the other? I mean, is the sort of what that first conversation is emotional validation of how everybody is feeling the foundation before any administration or logistics can build from there?

I would say yes. You can, of course, have some logistics planning in the first conversation because logistics might be part of what is causing the stress and anxiety for one or two of the people involved. the other part that you have to contend with is folks are allowed to set boundaries in different ways and particularly if they're half siblings there might be a friction point with a particular parent that you don't have so maybe you have a great relationship with your father but your sister or your brother does not and they might make a decision to not want to provide certain types of support based on their lived experience and they're allowed to do that. You don't get to belittle, manipulate, peer pressure, condemn whatever, the sibling because of a boundary that they have set for their own mental health. And that can also be a lot of what causes animosity and resentment in some of these conversations

is somebody is more comfortable or more willing to pick up some of the work in a family dynamic and another isn't because of a type of boundary they've set. But again, coming back to that point of you can be raised in the same house and have vastly different relationships with family members. We'll return to the show in just a moment. As we talk through the complexity of family dynamics, you've mentioned that the situation can get more complicated when different siblings have different relationships with parents, when there are half siblings involved, when there are step siblings involved. And then to

add yet another layer of complexity onto this, then each person yourself, your siblings, your half siblings, your step siblings, you know, many of them have spouses who would also be affected by decisions that are made. How do you navigate those conversations with spouses or partners? First, I would say that the couple themselves need to get aligned on what they're comfortable with before coming to a larger family conversation. So to just use myself as an example, if my husband and I needed to provide support for a parent, that the two of us have a conversation together, analyze our own financial situation, and realistically discuss what we are comfortable providing as financial support

and be aligned on that before going into a conversation with, let's say, his siblings. Because it's not fair for one partner to agree and spend the money without talking to the other. What can also be really complicated, though, is if you marry somebody or otherwise partner with somebody who has been providing financial support to a family member or multiple family member, or multiple family members prior to you coming into the picture. And then the existence of you changes the situation. And that was one of the dynamics that gets discussed in Broke Millennial Talks Many is a gentleman who had been providing financial support to his mom and his grandparents.

And then he got married, had a kid, bought a house. And it changed how much support he could offer his family. But that that had to be a conversation first between him and his wife about what they could afford to provide. And then between him and his mom and his grandparents about, hey, my circumstances have changed. I, of course, still love you and want to support you, but this is how much I can provide now compared to before. What do you do if you're trying to have that conversation with a partner, but you feel like the partner is just steamrolling over you? At some point, you might need to bring in a neutral

third party, like a couples counselor, if you are not able to get your voice heard. you really don't want to put yourself in a position of, you know, them or me. You have to pick. That is never really where this needs to end up. There needs to be some level of another person stepping in, preferably totally neutral third party. And it makes sense, though, that your partner might feel like, hey, I mean, I'm not going to let my parents flounder. They raise me. I'm going to support them. So you just need to get on board. And you're allowed to feel like, Hold on. We also have a financial life that we have to figure out. You don't get to unilaterally make decisions. Part of it too is giving yourself really and your partner the space to be like, this sucks. And I know that that sounds a little bit silly. But again, another example in the book is a discussion about one partner who a mother had gotten very ill. He was a like, listen, we have to move back to where I'm from. I have to go back and take care of her. And the wife knew that that was going to be what had to happen, but she wasn't happy about it.

And it's okay that she's not happy about it. And she's allowed to say and vocalize that. But at some point, it has to be like, okay, you've said it. We get it. But let's deal with the reality that we're in. So it's giving your partner the space to have the feelings and move through the process. But then both of you also have to get to the other side. So it's not a every time we get mad about something, it gets brought up and thrown in the other person's face, which is true really of all money fights in relationships. It can't be every time, well, you wanted the bigger house and we bought the bigger house. So now this is the problem. If you agreed to move into that bigger house, you agreed to move into it. You got to, you're like,

okay, I get it. Let's move on. Right. But often it's the conversations that don't get resolved upfront that create resentment that carries. There isn't. I think what's fascinating about that too. And this was a concept I'd not heard of until talking with a financial therapist for the book. Most relationships have a lot of perpetual problems that aren't technically solvable. And I say that because neither party is wrong. So neither one can be like, ha ha, my way is right. Your way is wrong. Therefore, both are technically right. They're allowed to feel the way they feel, but they're in disagreement. So an example was, is you want to go to the airport.

One wants to be there two hours early. One wants to be there 45 minutes early. Well, as long as you make the flight, no one's wrong, but you want different things. And you have different ways of going about getting to the finish line. So these perpetual problems come up a lot when it comes to finances. And so it also becomes about how do you compromise and how do you sometimes just let the one person take the W and then go back and forth a little bit on that instead of always having to meet halfway. sometimes someone gets to take the win.

We're coming to the end of our time. Thank you for spending this time with us. Are there any final tidbits of wisdom, any final takeaways that you would like to share? I will just say talking about finances is perhaps one of the most critical skills we can learn because you can learn how to build your foundation, you can learn how to grow your wealth.

But if you don't communicate effectively about it, it really can forever be a big pain point for you. And so I just hope that everyone finds a way to resolve whatever money friction points that they have in whatever relationship by learning how to communicate about it better. Thank you, Erin. What are the key takeaways that we got from this conversation? Here are five. Number one, advocate for yourself. Set boundaries and expectations before you need to.

Now, in the case of going out with friends, for example, tell them when the plans are being made, what your boundaries. are. So for example, you could set a hard maximum. You could say, hey, I can only spend a maximum of $40 on this, including tax and tip. So whatever restaurant we choose, please know that my maximum is 40 bucks. That's one way of setting those boundaries proactively, setting them during the planning phase, where that conversation is likely to go a lot better. What you don't want to do is wait until the last second, like wait until the bill comes to the dinner table and then announce after the meal, oh, hey, by the way, I have this particular boundary, I have this particular upper limit. That conversation is likely to not go quite as well. The earlier in the conversation

you can bring up those boundaries or set those expectations, the better. Another thing that you can do is to give clear alternatives, such as, hey, I'm happy to meet up with you before the event, or I'm happy to meet up with you after the event. Or, hey, if you want to come over, I would be happy to make you a meal. Or we could have drinks at my place. If you were invited to participate in a wedding, you can say, hey, you know what? I can do either X or I can do Y. Which one would you prefer?

I can either come to the Bachelorette or I can come to the Brotto Shower. I can't really do both. The choice is yours. Which one would you prefer me to be at? I love this line from Melanie Lockhart who talks about this, idea of which feeling is going to be worse, the potential embarrassment you feel in the moment, or the resentment that you might hang on to for days afterwards. The bottom line is, don't be afraid to say no.

You care about your money more than anyone else, so other people shouldn't get to spend it for you. And be open and honest. Again, the sooner the better so that resentment doesn't build, and it's not a surprise to your friends. That is key takeaway number one. Key takeaway number two. Create a friend fund.

If you want to avoid awkward money conversations completely, one of the best ways is to set up a friend fund so that you don't have to say no, or at least so that you'll say no less often. Essentially, this is a subsection of your savings that is dedicated specifically to going out and having fun with friends, going to dinners, going on trips, going to concerts, giving gifts.

You'll feel greater peace of mind when you know that there's a portion of your budget that's allocated to this. This is part of your financial plan. And it says something about how much you make it a priority, that you take the time to make sure that you have savings set aside for having fun with your friends. An easy way to do this is to set up automatic transfers to a separate fund that you only use for dinners, gatherings, events. And if you think that a friend fund sounds frivolous, think about what's worth more, your friendships and relationships or your financial goals. I don't mean to create a false dichotomy.

Of course, you can pursue both, but in order to pursue both, you need to pay attention to both. You can't dismiss doing work on your friendships and relationships as frivolous. And having a section of your budget set aside for your friendships, that is, in part, doing that work. What is the payoff?

What are you sacrificing and long? term, are you totally sure that that's worth it? Or maybe you should have a friend fund or a fund money that you set aside so that sometimes you can say yes and opt in. Remember, it's not about being ultra frugal for the sake of hitting FI two years sooner than you otherwise would have. That's not worth it if it comes at the cost of your friendships. It is okay to invest in relationships and friendships. And there are also ways that you can do that that stay within your budget. So that is key takeaway number two.

Key takeaway number three, choose emotional validation before you choose judgment. Often, navigating awkward money conversations requires a high degree of empathy. Validating the emotions of others can diffuse what would otherwise be a tense conversation. Your job is to understand where the other person is coming from. Here's a great way to do this.

How do you relate to money? How is this making you feel? And you can be honest enough like, hey, I have to be honest with you. I do not understand this reaction. And I'm not saying that it's invalid if you could just explain to me why you feel this way. So I don't communicate with you like this again or that we can work through this. But I don't understand why you're having this reaction to me right now. Coming off as judgmental doesn't help anyone.

All it does is it raises defenses. So don't tell people or insinuate that people shouldn't value something. Just because your priorities are different, it's not your place to say, hey, I think that's a stupid way to spend your money. Maybe you do think that, but your priorities are different than somebody else's and they're allowed to do their thing. So let them know that you appreciate the offer or the invitation, but that you're going to opt out.

Tell them your reason why, like, I need to save, I need to pay off debt, I'm trying to reach this particular goal. If you model not judging other people's choices, then ideally, hopefully, hopefully, hopefully, Hopefully, they will model the same thing in return. So that is key takeaway number three. Key takeaway number four. Realize that your siblings may not have the same lived experiences as you. Just because you and your siblings grew up together in the same household with the same

family members doesn't mean that you both shared the same experiences. And this may make it difficult to agree on a plan for how to take care of your parents, grandparents, aging uncles or aunts. This may make it difficult to view your family in the same way because your experience of your family is different. Now, the best way to bring this up is by talking to your siblings first before going to an aging parent, grandparent, uncle aunt, before going to somebody else. Go directly to your siblings first. Have those conversations with your siblings first. I want to have a conversation about mom and dad's financial prospects in the future.

I'm feeling a little stressed about it. I'm not sure how you're feeling, but I'd love to sit down and just have a conversation about it. So we can put our worries or thoughts on the table and see what happens. This conversation can evolve over time. It doesn't need to be resolved in one sitting. The first step, however, is to approach your siblings and voice your concerns and be open to alternatives. Maybe your siblings earn less than you do and they can't contribute as much financially,

but perhaps they have more free time and they can physically take care of your parents if you decide to go that route. Everybody contributes in their own way. So those are the types of conversations that you can have. You know, what is the best form for each of us to contribute? But those are the ongoing conversations that you need to be having with your siblings. So that is key takeaway number four. Key takeaway number five. Get on the same page as your partner first, particularly when it comes to you.

to decisions about each of your families. If one of you has a family member that needs help, you need to discuss how to approach this together. And it's not fair for one person to make a unilateral decision or to steamroll over the other person, particularly when your shared resources are at stake. You want to avoid a me versus them situation, specifically in a case where your partner was providing financial support prior to your relationship. and you also want to avoid getting steamrolled and feeling as though you no longer have control over

your own shared pool of resources because no matter what you say, in the absence of an agreement, the default will be that your partner just commands over you. That's not a healthy relationship. That quickly turns into a dictatorship where only one person makes the decision and the other person is forced to go along with it. And so the work of getting on the same page is more than just the work of bringing up the topic. It's perhaps more so than talking. It's the work of listening. And that has to happen both ways. If my husband and I needed to provide support for a parent, that the two of us have a conversation together, analyze our own financial situation, and realistically

discuss what we are comfortable providing as financial support and be aligned on that before going into a conversation with, let's say, his siblings. If your partner isn't willing to listen, you may need to bring in a neutral third party to help mediate. And additionally, there may be times when you both need to compromise or when doing the right thing is really difficult. Where things get tricky is when only one person is compromising and the other person always gets their way. That's what can ruin relationships. You both need to be allowed to have space and to have flexibility to not only express your feelings, but let your ideas be translated into action. And given that these conversations can be ongoing and can take time, you need to have a clear

plan for what happens in the absence of an agreement or what happens in the interim before an agreement is reached. Because if what happens during that interim period is that in the absence of an agreement, you default to just one person, to what one given person wants, well, then that's not fair. And that's a relationship that's going to breed ongoing resentment. And that's when you definitely need a neutral third party to come in and to mediate. Somebody who is specifically trained at those types of issues, someone who specifically is an expert at marital conflict resolution. So those are five key takeaways from this conversation with Aaron Lowry, the author of the Broke Millennial Book series with her latest book, Broke Millennial Talks Money.

Speaking of talking about money, we have been talking about money a lot with the people who are in our 31-day challenge. So if your January 2021 did not go as swimmingly as planned and you want to kickstart the new year, new February, new you, join our 31-day challenge. Yeah, I understand February has only 28 days, but hey, join our 31-day challenge anyway. You can join any time. It's totally free. And every day for 31 days, you get an email with one idea, one question, and one action that you can take related to money, investments, motivation, habits, productivity, and much more. There's also a great community that discusses each day's challenge that shares their ideas and experiences and questions and stories. So it's a great way to get this new year started right.

And you can sign up for free at afford anything.com slash 31 day challenge. That's afford anything.com slash 31 day challenge. Thank you again for tuning in. My name is Paula Pant. This is the Afford Anything podcast and I will catch you in the next episode.