Personal finance etiquette for 2019: Your stupid simple guide to talking money

What does a gifted frugal machine like yourself do to navigate the dangerous waters of discussing money and personal finance? Here’s a simple situational guide to help point you in the right direction.

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Money and personal finance can be a difficult thing to talk about. Some people are just weird when it comes to money, and some situations require seriously creative thinking when it comes to cold hard cash.

On one hand, we want to be helpful and offer genuine assistance when needed, but on the other, we also don’t want people to take advantage of us or take your generosity for granted.

What’s a gifted frugal machine like yourself do to navigate those dangerous waters? Here’s a simple situational guide to help point you in the right direction with common money situations we tackle in life.


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Personal finance etiquette in 2019: A situational guide

Here are a few scenarios:

You suddenly came into some money (lottery, big job promotion, etc) and a friend or family member has expressed a peculiar new-found interest in your success and hints at their own need for money.

You know, they’ve suddenly “fallen on hard times” and just need some temporary help from a kind soul with some extra dough.

Kindly offer your advice on how to generate more income or get ahead at work. Sympathies aren’t what they are looking for, and you know that.

But, that doesn’t matter. They didn’t earn the money. You did (except for playing the lottery…you didn’t earn “jack”, but you DID choose to actually play). Regardless, be relentlessly positive. Offer support and guidance.

But, it’s your money and not theirs. The moment you so much as hint at the possibility of “loaning” them money, you’ve pretty much committed yourself.

And, the requests for money most likely won’t stop.

Lastly, I’d pay special attention to those people who suddenly show their faces after they found out that you’ve come into some additional cash. Friends do this, but so do family members, and it sucks. If you think they are only cozying up to you for your money, they probably are.

Friends and family expect your professional advice/services for free.

If you are a software developer and a family member needs a website built, they might come to you and ask for your “help” – or in other words, free labor.

Doctors, lawyers, general contractors and virtually anyone who has specialized knowledge and experience has probably been solicited for free work.

You are under no obligation to provide your services for free, even for family. Though you certainly can if it makes sense, be sure it does not interfere with your ability to make a living.

If you’d rather not take on free work but don’t have the heart to “just say no”, then consider telling that person that you’re swamped at the moment. Too busy. Enough of these types of excuses and they might get the hint.

And likewise, YOU should never expect friends or family to provide expertise that they spent thousands of hours to master (or thousands of dollars to learn) for free. They may offer a “friend or family discount”, but they are professionals, like you.

Treat them like one.

That said: If someone asks me an IT question, I won’t suddenly send them a bill just for talking with me. I’m not that anal. If someone wants advice, I’ll generally provide it. But, I’m done with forking over mountains of work for free.

Been there, done that, but I was too busy to buy the t-shirt.

A friend asks for a small loan, but they haven’t yet paid you back for that other “small loan”.

I never consider a loan to be a loan. Never give someone money that you actually need to be returned. Ever. Instead, you may outwardly agree that it’s a loan, but inside, you’re mentally preparing yourself to never see that money again.

If a friend asks you for money when they haven’t yet paid you back for another “loan”, kindly remind them of your previous arrangement and that you need to prioritize YOUR financial situation (in your head, that means not loaning more money to someone who probably has no real interest or ability in paying it back).

A friend borrows $1,000 from you and starts walking around with a brand new pair of expensive penny loafers.

First, refer to the previous situation – never loan someone money that you need back. Once money has left your hands for another hand, it could very well be gone forever. In this case, your “friend” seems to have had the means to come up with that $1,000 on their own with the sudden sporting of expensive footwear. Of course, it could also be a suit, jacket or anything else.

In other words, they probably had the money.

Take notice of the new pair of shoes and offer an innocent conversation starter: “Hey, nice shoes! When did you pick those up?” Then, start digging a bit deeper: “Oh, I hope that the $1,000 helped you out.” This should get the ball rollin’ a bit.

If your friend doesn’t take the hint, consider offering a more pointed query, such as: “You could always just give me your new pair of shoes instead of paying back the grand. Hah!” It’s funny, but it’s also really not.

Personally, this is about as far as I’d take it.

Mentally, I’d already said goodbye to that grand anyway. But, I’d definitely reconsider my friendship with this person if he or she has expressed no real interest in making good on the deal, especially if they are buying expensive stuff after asking for money.

Someone loves to ask you how much your house/car/boat/whatever costs.

Naturally, you are under no obligation to answer these types of questions, and frankly, I’d consider them extremely tactless to even ask. But, some people out there lack tact. Lack it big time.

If I’m ever asked a question about how much something costs and I prefer not to answer, I’ll generally give them a polite “F-off” answer, like: “Way more than it should have! But hey, did you watch the Packer game last week?”

This accomplishes two things: First, it lets the person know that you have no interest in talking about money, and second, it immediately changes the subject to something you might have an interest in.

Your lunchmate asks you to pick up the check (again) after several previous meals without him or her even reaching for the bill. 

I’d start with, “Hey, why don’t we split this one? I’ve picked up the last couple and it’s making a dent in our restaurant budget.” Unless you’re dining with a real tool, that will probably be enough of a hint for that person to toss out a credit card to cover their portion of the bill.

If it doesn’t, and it seems like the only person who’s willing to pay is you, then pay the bill and decline the next lunch invitation (or if you’re the one doing the invite, don’t invite him or her). Something like, “Sorry, I need to start brown-baggin’ it a little more to save some cash” should do it.

Or, you’re dining with a couple of colleagues and you easily get the least expensive meal, but they want to split the check equally. 

If it’s a difference of just a few bucks, I wouldn’t worry about it. Pay your share and move on and consider the additional few dollars payment for good company and conversation. However, if you ordered a salad and they ordered prime-cut filets, then the difference is probably significant.

“Hmm, I think $20 should cover my salad and share of the tip, right?” I opt for being a little generous with my offer. I’ll cover my meal dollar-for-dollar but will offer a tip amount in the neighborhood of the final bill – not just my share.

I’ve found the extra few bucks goes a long way to avoiding conflict in an otherwise happy and peaceful setting even though you don’t actually owe that much.

“We can’t just split it evenly?” If you get that question in response to your perfectly reasonable offering, that’s your queue to sever your lunch relationship with those people. Running up the bill with expensive meals and asking a much more frugal person to pay more than their fair share isn’t the mark of true friendship, and I personally avoid engaging with people like that – for lunch or otherwise.

You like to entertain for friends and family, but you always seem to be the person who pays for food, drink, and entertainment.

Try to throw a BYOB/F – Bring Your Own Food/Beer party instead of offering to supply everything. Or at the very least, establish an understanding that everyone is expected to at least bring something to the party. A side dish. A six-pack of booze. Something.

Freeloading time is over. Even if you have to buy something from the store instead of making it, that’s fine. Everyone makes a contribution.

Another option would be to encourage someone else to take a turn as the host. It is implied that the host will spend a little more on entertainment events because they want people to have a good time at their house. When you’re always hosting, you are always signing yourself up to spend a little extra on people’s happiness. Instead, consider rotating homes for the next few dinner parties to help split up the cost.

The gifts you give are always worth way more than the gifts you receive.

First, look inward and examine your personality. For some of us, it genuinely makes us happy to spend money on other people, to see the smile on their face and excitement in their eyes, and we are willing to pay extra for a more expensive gift in order to obtain that level of joy – both for the other person as well as for us. In this case, it might be okay to spend more.

However, that doesn’t necessarily mean that consistently spending more money than other people on gifts is always a good thing. If you feel resentful that people aren’t matching your level of investment in gifts, simply change your investment. If they are used to getting gifts of a certain “quality” from you, tell them that you’re trying to watch your finances a bit more and need to save a little bit more money (or spend less). Match their investment instead.

Or…if your group of friends tends to spend hundreds of dollars on gifts, but you’re only able to spend a fraction of that, be honest and upfront. It’s easier to set and manage expectations from the very beginning than awkwardly explain why you gave someone hand-made mittens when they got you a $500 handbag.

Is it ever a good idea to offer someone a loan during a rough patch?

Sure! I am not against helping someone out with a little cash when they need it. But, the larger concern is making sure the request is coming from an honest and trustworthy person.

If they have a history of not following through with their agreements or are flakey people, that’s an indication you’ll never see that money again. You should never feel bad about looking out for your own financial well-being first. If you don’t, no one else will either. It’s okay to be “selfish”.

Like I’ve said several times before, I consider all loan money gone – as if it were a gift. If it get it back, then cool. Otherwise, I’ll chalk that up to a “good deed” and move on with my life, likely without the involvement of the person who preferred not to uphold their end of the deal.

This article originally appeared on ThinkSaveRetire.


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