It’s the morning after you’ve gone out with your mates and you decide to do the scary task of looking at your bank balance.
You weren’t thinking about how much money you were spending when you were tapping away but buying several rounds of tequila shots for all your friends probably wasn’t the smartest idea in hindsight.
However, after taking a look at your bank balance, you remember that you paid for the Uber and food as well as those drinks for your mates. You really should ask for the money back but you don’t want to look like that annoying cheap friend. It might not feel like a large amount of money, but all that money you’ve spent on your friends can seriously rack up.
With money conversations being a sensitive topic for many, 1,500 people were surveyed in the UK by Moneyboat to find out just how much our discomfort is costing us.
Brits are losing almost a whopping £900 a year due to difficulties with having conversations around money, according to the research.
Do you like getting a coffee with your friends? Well, a third of Brits admitted to sometimes not asking for money back after buying an item for friends/family as part of their purchase (i.e. a coffee or event ticket), with the average Brit saying this happens at least twice a month.
But by avoiding conversations around money, Brits are spending £318.91 a year after buying friends or family something as part of their order. Meanwhile only 11% of respondents said that they always ask their loved ones for their money back.
With the cost of living crisis still alive and kicking, many of us can’t afford to go out the way we used to. Instead of being honest with our friends about our finances, many Brits are choosing to go out anyway.
The survey found that Brits lose £540 a year by not telling people they can’t afford social plans. Furthermore, over a quarter of Brits attend social plans they can’t afford but feel too embarrassed to say so.
When it comes to talking about money, the research looked to reveal the types of conversations we find the hardest. The top five were:
- Asking for money back after lending to friends/family (38%)
- Asking for money back after footing the full bill for a meal (29%)
- Asking to pay exactly for what you had on a food bill instead of splitting it evenly (25%)
- Telling people you’re not able to afford something (25%)
- How much is in your bank account or savings (18%)
Unfortunately, it doesn’t seem like the cost of living crisis is going anywhere so now isn’t the time to spend money you don’t have. So, how can you talk to your loved ones about money? Laura Rettie, Editor-in-chief of Finance.co.uk explains how.
Be more transparent about your paycheque
Being more transparent about how much we get paid may help people who are struggling financially to feel less alone (because millions of us don’t have savings and are in debt too), and will help you to understand financial products better, saving you money and time.
Be empathetic
Money is a sensitive topic, and many people feel embarrassed or ashamed about their financial situation. Show your friend or family member that you care about them and that you’re there to support them, not judge them.
Practice discussing money with your loved ones to build confidence
Practice discussing your finances with loved ones, to help you feel more confident, and use the internet to find out more about complex financial subjects. Be honest about your financial situation and don’t be afraid to ask your loved ones questions about their own finances (but expect them to feel uncomfortable at first).
Frame conversations around your financial goals to give them a positive outlook
Rather than focussing on the negative aspects of finances, frame the conversation around your financial goals and what you’re doing to achieve them. This can help shift the discussion from one of shame to one of empowerment.