Money Manners: Solutions to Common Financial Dilemmas
Few things are more uncomfortable than mixing personal relationships and money. Fortunately, there are fixes. By approaching difficult money matters head-on and with a little forethought, you can avoid repeating similar scenarios in the future. Here are some specific questions related to awkward money situations and suggested responses.
Q: A friend asks, "How much did you pay for that purse?" or "What kind of deal did you get on your new car?" You'd rather not share.
A: Some people are naturally nosy. However, the amount of over-sharing we see on social media these days can also make some people assume that money questions are fair game. Keep in mind, you're not obligated to share information that makes you uncomfortable.
An easy answer that makes it clear you're not going to talk about prices: "I paid a little more than I probably should have, but I really love it. What's new with you?"
If your friend is pushy, you can be more blunt: "My new policy is to not talk about costs. I've found it can get awkward. So, what's up with you these days?"
Q: I opened a joint credit card account with my son when he was a teenager. He's an adult now and isn't making payments. How can I take my name off the account so I'm not connected to his financial mistakes?
A: It's not unusual for parents to share credit card accounts with their kids at some point. However, it's too bad you didn't just add your son as an authorized user on your own credit account. You could have removed him from your account as soon as he started acting irresponsibly.
When you're a joint signer on an account, you're both legally responsible for the credit card debt. Now that your son isn't paying, the credit card company has a right to come after you for payment.
The only way to untangle yourself from your son's financial mischief, unfortunately, is to close the credit card account. And you can only close the account by first paying off the full balance.
So, the short answer is to pay off the card, close the account and let your son know that his deadbeat days are over. And, if your son automatically charges bills like utilities or subscriptions to the card you closed, remind him that he'll need to find a new way to pay for them.
Q: I've given my housecleaner extra money from time to time. However, she keeps asking for more. How can I diplomatically end these money requests?
A: Are you paying her a fair rate? Check with friends and neighbors about current prices or look for average local rates at a website like Homeadvisor.com. If your fee is reasonable, you may have to contend with other issues.
Try sitting down with her and saying something along this line: "The last time I gave you extra money, I thought I was helping out. But now it feels awkward to continue giving you money that isn't connected to work." Ask if you can help in another way, such as customer referrals, recommendations for a class on budgeting or a referral to a social service agency.
Also, consider looking for a new housecleaner. If she's bothered by the money talk, she may quit without notice, so be prepared.
Q: Whenever I eat at a restaurant with a certain friend, he hesitates about the bill. I usually end up covering the whole thing. Sometimes he says he'll pay me back later, but he rarely repays me for his share of the bill.
A: Before you head out for your next meal, make it clear that you're only paying for yourself. Try saying, "How should we split the bill? Do you want to just divide it in half, or should we each pay for our own food and drink? Or we could just ask for separate checks."
Addressing the bill before you leave home should preclude the "forgotten wallet" excuse. Or, if on the way to the restaurant he says he's left his wallet at home, offer to take him back to get it, or suggest an alternate, no-cost activity.
If your friend has a credit card or cash and just balks at using his own funds, consider going high-tech on him. Before you get together again, enroll in a mobile payment app like SquareCash or Venmo. It's easy to add your friend as a payee by inputting his name and email or mobile phone number.
When it's time to ante up for the next bill, say to your friend, "I really want to try this new digital payment account I just set up on my phone. Could you cover the bill? I can instantly send you my share with this app. I'll show you how simple it is."
There's no real way to remove all the awkwardness when you're talking about money. Having straightforward but gentle talks now can avoid confrontations later or a loss of friendship. These conversations can also save you from making some expensive money mistakes.