Throughout my life, my parents always talked about money.  How much this cost, why that was so expensive, how to save money here and there.  So I guess I've grown accustomed to hearing money in conversations. 

Now that I'm all grown up and living away from my family, I'm finding that I can't have the same conversations about money with the people around me. 

Sure I can talk to my wife about our spending habits and long term goals.  But when it comes to investment and wealth building strategies, I'm on my own. 

That's probably why I like blogging about money so much.  I guess to express the money related thoughts running through my head most of the day.  Also because I can't talk about this stuff to my friends without them being extremely uncomfortable.

Unfortunately, around these parts, there are no investment clubs or anything similar.  The pf blog world and the readers are my investment club.

So why is talking about sex, politics, religion, crime, gossip so easy, but talking about money so difficult to some people?

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I think it’s simply understanding. Everyone knows how sex works, people kind of know how politicians lie all the time, most people know that religion is just a big money making scam, everyone sees the crimes on the news, gossip is fun because it’s so close to home normally.

Barely anyone really knows how money and investments work, so most of the conversations would start like this. “Hey Jim, how’s about those equity funds?” . . . “Well bob, I just ask my bank every year to tell me what they did”. Then the conversation would be over.

I’ve used Preet’s RRSP book on my desk for a while now to try to get some more people talking, and since I talk about money a lot it’s become much more common of a topic around my workplace. Mostly though it’s me talking about the neat things I find online and people just humor me, but it’s a start.

I think people don’t talk about finance because they feel guilty of not knowing how it works. Either that or, like my parents, they think that working hard and having a paid house is enough for retirement.

I tried many times to explain them that their property was not a pension plan as they call it and that working hard is good only for so many years (my dad is 57 now). They simply don’t get it…

I guess it all starts to the basic; we don’t have personal finance class at school. Personally, I have no mechanic knowledge, interest or skills. However, if I had a basic class of mechanic, I would probably be able to at least have a conversation about it. I think it is the same thing about finance (and it is more useful too!).

I’d say there’s a few reasons this could happen. One that comes to mind right away is that a far larger majority of people are running their net worth into the ground and going into debt. This isn’t exactly something to brag about, so it’s an awkward subject when people (who seem to be doing better than them) bring up finances.

When I grew up, we lived in neighborhoods where just about everyone there made about the same amount of money. The variety of incomes in a single neighborhood now-a-days can be much larger because 1/2 the people on the block are living off of credit cards to “keep up with the Joneses” next door.

It’s taboo in many families to talk about money. Many children never hear money talk, and if they ask about money they’re told that it isn’t polite. This trend continues into adulthood, and the cycle repeats.

As Mr. Debtbeater notes, a lot of people are hugely in debt, but they often don’t appear to be – they have nice cars, nice homes, and nice clothes. These people have a very good reason for not discussing their finances – if they keep their mouths shut, they appear to be a lot wealthier than they really are.

It’s all so true! I was talking to my wife the other day when my son chimed in he said he needed a credit card you know “to pay for things [he] wants”. I explained to him that his mom and I were trying hard to never need to use the card again. If I tried to have the same conversation with my Mom at that age she would have told me that her money was her business and no one else need know about any thing that goes on.

How far we have come. I don’t speak numbers with my kids but they do know how I feel. As they get older I will introduce them to the numbers when I feel they can understand it all…..Good Post.

I personally think that like the posters above most are so broke they don’t want to talk about it at all.

Another thing is people misunderstand inflation and the time value of money.

Say you have one dollar in Savings account for 50 years at 4%.

1* (1.04)^50 = 7.106683346

What will you get for 7 dollars in 2058 who knows but it will be a whole lot more then buy something at Walmart today.

Some great comments.

FT – I think you might find that when you get older (ie my age – 39) that your peers will be a lot more interested in money because they will probably have more of it and they might be starting to think about retirement which in their twenties is probably not a thought at all.

Just a thought…


MunEconomist your comment

“I personally think that like the posters above most are so broke they don’t want to talk about it at all.”

Its comments from people such as yours which keep people in the closet with there finances. I think if people were a little less judgemental then mabey more people would have a better understanding of what they should do with money. I know if I was told some of the things I’m reading about online with blogs such as Million Dollar Journey. I would not be in the shape I put myself into.

Be a little kinder with your remarks some people are really trying and comments like yours are truly discouraging.

Mmm, very interesting topic. I have to agree with some of the other comments in regards to the average person doesn’t want to admit they don’t know much about money.

Since I was in the Globe a while back about my investments I’ve become the ‘money guy’ in the office (my boss was reading the article on the way to the office and sent everyone a copy). So over the last few months I’ve been asked a series of questions by people as they try to figure out more about money. I’ve even borrow out a few books to the more serious people. The result is I now have an office of people that will actually talk a bit about money.

It’s rather refreshing. I’m also making progress on my extended family so that we can actually have the odd conversation about it.

In order to be really useful to each other I think we need to break the taboo and talk more about it. Start slowly and explain things when you get a blank look. It may take a while but in the end I think it is worth it.


Endlessly interesting topic …. after all, that’s why people want real numbers from blogers, they don’t see any in real life.

I’m with James in comment 8, the assumption that people won’t talk about money because their finances are FUBAR is bizarre, and a little judgemental. I’ve never been in debt in my life, beyond reasonable mortgages, and I wouldn’t dream of telling people “in real life” my salary or my account balances, or asking theirs. Or bringing up asset allocation in a chat in the pub. I mean even the amount of tax refund you get is a national secret in my circles. My thoughts have always been more along George’s lines – a sense that money isn’t discussed in polite company gets passed down families – and I’m aware I contribute to it. My husband, whose family has no problem discussing money out loud, has told friends what I earn and how much my bonuses have been in the past, which has led to some outrageous fights. He doesn’t get the taboo at all. Maybe I’m just an uptight white chick :)

(That they’re-all-broke assumption is also a weirdly common thread in moneyblog comments “Well, the only reason your friend is comfortable buying that diamond ring is because they’re up to their eyes in debt” – never that they earn more than you, or have a high-income spouse or saved their arses off last year or something).

James sorry my comments were so harsh that was not meant to come off like that. My comments are intended for people like my friends who don’t seem to understand money.

They make $ 50,000.00 but they spend $ 65,000.00. No matter what you are spending it on this type of lifestyle can not contine for long periods.

That was my point.

Thank you FT for the clarification on ETF. Does it mean that some ETFs can be for a longer term or is it better on a shorter term like 12-18 months? Sorry if my questions are very basic.
You have voiced out my sentiments in this post. I find that it is so much harder to talk about money in my circles either because people don’t want you to know their income/ debt or they don’t want to share their secrets of success!! Either way I have learnt far more from blogs because not only are they informative and analytical, they are also based on personal experience. Invaluable!! Thank you.

I wish my parents had been more willing to discuss finances when I was growing up. Even just a demonstration on the power of compound interest when investing at an early age would probably have had a significant impact on my current situation. I’m just happy I decided to really start educating myself while I am still in my thirties. Still lots of time to right the ship, and get money working for me.

I think that so many people feel uncomfortable talking about money because for many people, it is a measure of worth that easily compares you to other individuals.

“You have $1 million, I have $10,000…you are worth 100 times as much as me and I will never be worth more than you…you must be ‘better’ than me.” :(

Instead of focusing on the specific conditions that they, as individuals, can change to improve their situation, they focus on how different they are from others. Instead of changing their course or figuring out how to change their course, people will often try and rationalize why they should be entitled to a specific lifestyle and presume that somehow…life will magically create the situation for them.

What’s the best way to become a better swimmer? You need to have someone critique your style, your start, your streamline, your stroke and breathing patterns, your turns, and your finish.

For some reason, many people mistakenly believe that they can become financially successful without undergoing methods of critique and observation to improve their situation.

This is a premise that you, others, and I have taken upon themselves to change. That it is ok to talk about money and improving your financial path. That the only way to improve is by choosing a course of action that will expose your weaknesses and magnify your strengths.

We are not all the cream of the crop but we strive to be and that is what will make all the difference with time.

Money is certainly the last taboo. I’ve figured out which friends (a few) and relatives (almost none) I can talk with about money.

I disagree with the notion that if they’re not on the blog world or don’t talk about money, then surely they must spend more than they earn and be massively in debt. I know that most are not. They save and put money in rrsp’s. Maybe they put them in target funds or perhaps their asset allocation is all mixed up.

I take exception to the first comment that says religion is a “big money making scam”. It illustrates why some topics are difficult to talk about. There are so many religions and beliefs out there – and to call them all “scams” is insulting and ignorant. If I believe in something, it only makes sense that I would choose to support it financially so that it can sustain itself and provide assistance to others. After all, there are more important things in this world than your net worth.

So, today’s post may have suggested that talking about religion is easy, but it is of no value if it is unintelligent. The same could be said of discussions about money. Personal finances is a good topic for discussion if you are willing to be considerate of the other person and allow them to disagree with you – but if you are quick to make generalizing statements, then it is better to stick to topics like the weather!

It’s not fair to assume that people don’t talk about money because they have massive debts. Aside from the “not in polite company” reasons noted above, I don’t talk to most people about money issues primarily because I’m NOT in debt. Letting people know that kind of information just breeds contempt and makes me look like a snob.

In blog comments, I don’t see a problem divulging that kind of info, but I don’t think I’d do it face-to-face. You never know what kind of financial position other people are in – they could be far further ahead than you, or far further behind. Most people wisely don’t raise the issue to avoid the awkwardness.

I find that sometimes one can sound a bit like a salesman, especially when bringing up things like the Smith Manoeuvre, and that can put some people off. I suspect they think it’s just another scam, or there must be a catch somewhere.

I also wish my family new more about investing, as all I ever heard was “to save so that I won’t be poor”, without any explanation about the power of compounding, or dividend growth, etc.

Maybe the majority of people have no idea where they are financially. Don’t get upset about this because it can be proven that lately we have dissavings happening in Canada and the US.

I agree with Frank. Only recently did I start reading about financial advice because my financial situation was a mess.

In the past the advise I did receive from friends was to invest money in the sock market in the late 90’s. That did not go so well. My banker advised me to get an RRSP loan and put the money in a 4% term deposit. Not so good plus I spent the refund. ING Direct advised me to “save my money” at 3.25% but did not mention anything about reducing my credit line @ 9.25% or my credit cards @ 18%. My financial adviser never mentioned anything other than RRSP’s and RESP’s. Nothing to help me save taxes, reduce interest costs or a decent investment strategy.

One afternoon in a coffee shop, I had a conversation with a person that wanted to share his knowledge and was not selling me anything. It opened my eyes to new possibilities and I started reading and learning about personal finance. Now my finances are in order. Although I sometimes wish I had that conversation 10 years ago I might have not been to receptive to the idea.

Now at work or with friends if the subject of money comes up and I tell them how I eliminated all “bad” interest and that I’ve implemented the Smith Manoeuvre they think I’m selling a product. When I talk about how I’ve setup a stock portfolio they say “isn’t that too risky?”.

I will continue to talk about strategies and not necessarily dollar amounts with friends and co-workers. I stress how they should be informed and sometimes get a second opinion.

MunEconomist – not to be picking holes in your posts, but in post #6, you didn’t allow for taxes and inflation. One you do that, you should find that investing at 4% is roughly a breakeven proposition. Nothing wrong with it, mind you, but it isn’t progress.

Also, I think the “dissavings” concept you alluded to in post 20 is a media creation. There is one measure that the US government produces which the media report every year to show that people are not saving money. Problem is that one of the inputs into the equation is purchases on instalment plans. The gross amount of the purchase is recorded in the current year, not as it is paid off. For example, say you buy a car for $30,000 and pay it off over 5 years. The gov’t reports it as -$30,000 in year one and $0 effect in years 2-5. In reality, it is -$6,000 each year.

I’m not saying that we shouldn’t be saving more, but I think we need to treat media reports with a grain of salt.

Rod I know what you are saying but if this trend continues for years on end what does it mean?

Some people dont like to talk about money because its not important to them.. Maybe there is some remnant of the whole “Money is the root of all evil” going on too?

I find I don’t like to talk to people about money because they just don’t get where I’m coming from… I’ve told my parents and friends that I’m actually happier without stuff, and they don’t get it.. I’m happier with my money in my bank account than eating out or drinking or other frivolous spending.

When I was a bachelor, my girlfriend’s (at the time, now my wife) mother used to always ask why I slept on the floor.. I said,”Im comfortable and a bed costs alot” I figured if I could be happy and comfortable with the floor, then I’ll always be happy and comfortable with my bedding :) .. Similarly I don’t want to get to the point where I “need” any type of property, some guys “need” a comfortable bed, or a big TV for the game etc..

So yeah, when I talk to people they don’t really understand my Point of View and often feel threatened or insulted by an attempt to totally disregard material pleasures… alot of people thing I’m boring too :D


Great comment Daniel (#21). I wholeheartedly agree that, while “money” is not always the most enjoyable conversation, it’s somewhat a necessary evil, especially given the amount of misinformation people are getting from true financial sales people.

The important thing is to avoid the holier than thou attitude. Even if you only help one person in every 10 people you discuss finances with, you may pique their interest enough to change the way they perceive money in general (like the coffee shop guy you wish you’d met sooner).

MunEconomist – I don’t think the trend means anything, to be honest. Even though a car is a depreciating item (and due to ongoing maintenance costs, it can be considered a liability), the fact of having any equity in a car means that the money is not sunk. Note that leases would be treated differently here.

The question: is there a negative savings rate or are people in a negative cashflow situation? The two items, in my opinion, are not the same. Any given person can be true or false for either condition, independent of the other.

Here’s a link:

“Why is talking about money so difficult to some people?”
It’s a great question. There are probably a number of reasons but I would have to agree with the premise. As far as income is concerned most likely people find it difficult because there is a certain degree of self worth attached to income level. Thats probably a good reason to consider such conversation impolite unless people are willing to talk about it. Sometimes it seems to me that money and personal finance and investment strategies are as dangerous a topic as religion. Everyone has a different way of approaching it and everyone is convinced their way is the best or only way. I have been investing for many years and over that period of time experimented with many different approaches and done a lot of reading on the subject. I have evolved over that time an approach which I think is pretty unorthodox and probably would make many people shake their heads, but I know it works great for me. Perhaps the best approach for each individual is as unique as the individual him/herself.

Money is a very difficult subject to talk about. I think that most people like me which are in their early 20’s like to “live for the moment” and spend most of the money that they make if they found a good job after college. They want to enjoy life once and for all; get good clothes, drive nice sports cars, go on vacations/shopping/drinking with friends at nice places. It is the time to find the person of your dreams ( its valentines days anyways :-) ) So if you look sharp, then you have much higher chances of hitting a home run with the opposite sex :-)
I had a friend of mine, with who I had a conversation about money. He thinks that money is not important in life. He made $8,000/ year the first year that he was working, and he spend it all. 5 years later he was making 45-50k /year and he was still spending it all. He was surprised at his ability increase his spending as he increases his income..He was saving for retirement though, 5% of his salary ( matched 100% by his emplyer)
I had a conversation about another friend of mine about stocks. He shared with me his idea to make a killing in the stock market by actively trading chinese stocks. When I tried to warn him about risks for small investors in active trading, and asked him if he saved anything in a 401k ( the US version of a canadian RRSP) he got overly defensive and told me that he doesn’t like the idea of only being able to use the money when he retires 30-40 years from now. The sad thing is that his employer matches 100% of the first 6% of his income that he contributes to a retirement account. So if my friend was making 50k/year, and he put 3k/year in 401k, his employer would contribue 3k as well. Plus, there is a tax advantage of 20-30% on the income that he contributes to 401k. That’s like a 130% return just by signing up for that thing. I don’t think that Chinese stocks could provide that much in a short period of time ….

Hey MikeG, just to let you know “Money is the root of all evil” is actually a mis-quote from the bible. It’s actually

“. . . the love of money is the root of all evil . . .”

It’s not the money itself, it’s putting the money’s priority in front of more important things (in this example, faith . . . but since it’s the bible you can twist it any which way you want) that is the problem described.

holy smokes! MDJ, I do believe you got every cdn pf blogger to respond here! (oops – except where a woolywoman and givemebackmy5bucks?). Very cool!

(ps – can’t give any definitive answer as to why we don’t, but I can say this much for sure: if any of us can provide a safe, judgment-free place, and learn (Really, Really learn) not to use jargon, people are soooo glad to have the opportunity to talk about their financial situations)

[…] Ask the Readers: Talking about Money? By Million Dollar […]

[…] Ask the Readers: Talking About Money […]

> I’m finding that I can’t have the same conversations about
> money with the people around me.
> Sure I can talk to my wife about our spending habits and
> long term goals. But when it comes to investment and
> wealth building strategies, I’m on my own.

Wow! I can really relate to this. Not only am I on my own, but I am the bad guy in our family. The unstated message is “Everyone else is living beyond their means and having a great time. Why are you so worried about our financial future?”

Thanks for sharing your thoughts. I plan to include your article in my weekly carnival review this Friday.

Best Wishes,

[…] Price are you Paying to Have it All? The Supermom Myth Ask the Readers: Talking About Money You are Not Your Stuff, Your Stuff is Not You The Parent Trap: They Give and Give and Give… What […]

Guerrilla Investor, quoted for truth:
Perhaps the best approach for each individual is as unique as the individual him/herself

In fact, I’m going to go one step further and replace Perhaps with most definitely!

Money is very taboo in North American culture. But I think the root cause is that money is the manifestation of a person’s life decisions. Money is just a physical representation of time. When we trade dollar bills or gold bars or just numbers in a ledger, we are fundamentally trading time.

Now what you do (or don’t do) with your money speaks fundamentally about who you are. And speaking candidly about these decisions is very scary to most people.

I think there are two reasons for this:
1. People are not commonly “active” decision makers. Even the “active” ones have their moments of weakness.
2. Certain people like to make up for this lack by providing judgments and opinions on other people’s decision.

The tale of your chequebook is very closely tied to the tale of your life. Sharing this information with people is tantamount to sharing intimate pieces of your life’s story. People fear (very deeply) the judgments of others with respect to this information.

Of course, this is just my opinion, YMMV.

[…] The Financial Blogger has hosted the 140th Carnival of Personal Finance.  This issue was a bit more creative than usual as he used the "Prison Break" theme.  MDJ submitted a "best prisoners" (and controversial) article "Ask the Readers: Talking about Money". […]

[…] Accountant’s Daughter. I liked Lessons I Wish I Learned Earlier over at Smart Easy Money and Ask the Readers: Talking About Money? at Million Dollar […]

[…] Ask the Readers: Talking about Money […]

[…] I believe that the key to avoid money related issues is through open communication about money.  Even with our most trusted partners, some of us still treat money as a taboo subject. […]

I would like to suggest another view about difficulty in financial discussions. In my case, I have no interest in revealing my own financial standing, salary, etc. to family, friends – whoever, as I have observed that people feel entitled to my help if they discover I earn more money than they do. They neglect to take into account that I have worked hard my whole ife, saved money and made sacrifices. Often they have been impulsive with their own money, and haven’t taken care of their own future or set aside money for emergencies. Requests for aid from others usually arrive in the form of ‘an immediate crisis’ – savy people understand that this technique is designed to cause instant action without time for thought as to alternative solutions . . .