Many of us find talking about money to family and friends difficult. But given that relatives often end up lending to – or borrowing from – loved ones at some stage in life means it makes sense that we’re able to have conversations about cash, so that everyone knows where they stand.
Informal borrowing is pretty common. Nearly a third (31%) of people need to borrow money from our nearest and dearest at some stage, a survey suggests.
Here are Lloyds Bank’s tips to help make money conversations easier…
Be prepared
Sometimes it’s hard to know where to start. It can help to gather all the information you need.
It’s useful to have items such as bills and bank statements to hand, so you can be clear and not feel like you have to remember every little detail.
For example, if you are struggling to get a deposit together for a home, it will be easier to start the conversation if you know how much you’ll need to borrow and over what period.
Once you’ve established all the facts, working out a plan for how you will pay the money back becomes much easier.
Decide on a time and a place
Pick a time when there will be no distractions, so you can have a calm and considered conversation.
It may be that home isn’t the right place to have the discussion. Finding a neutral spot, particularly if it’s likely to be a difficult conversation, can be a good idea. Also, sitting next to each other rather than opposite can encourage you to talk more freely.
Listen as well as talk
A calm exchange of views is a lot better than one person giving their point of view and not honouring the other with a chance to be heard.
If you’re asking for financial support, it’s understandable that the other person might have some questions and concerns.
Understand and acknowledge the other person’s point of view and be ready to answer their questions about why you need help, and any other options you’ve explored.
Make a plan together
Always try to reach an agreement about what to do next together. Two people can perceive information differently, so it is a good idea to note everything down to ensure you are on the same page, and to allow you to iron out any misunderstandings straight away.
If you have a shared goal, this will help you to keep each other on track.
Keep the conversation going
Sometimes the relief of having talked about money is so overwhelming that people don’t mention it again, and forget to put words into action. Having regular conversations about money is really helpful, both for your finances and your relationships. Make this a habit – not just a conversation you have when times are difficult.
Further help is available online as part of the Lloyds Bank M-word campaign. Visit lloydsbank.com/help-guidance/mword.asp
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