The taboo of talking about money

In today’s society it has become difficult to talk about money. It has gone as far as being referred to as ‘the last taboo’.

Research has shown that conversations about money make people feel uncomfortable and conflicted, as it is such an emotional issue. People attach feelings of adequacy, security and acceptance to feelings towards money and therefore, it is difficult to talk to others about finances, because money incites such strong emotional reactions.

Difficulties in opening up

A financial planner’s job mainly entails talking to clients about their personal finances. The first two steps in the six-step financial planning process is to firstly establish and define the professional relationship and secondly, to gather the necessary information from the client.

If communication about money is such a sensitive and taboo subject, then these first two steps might be difficult in getting the client to open up and be honest about his or her finances.

If a client does not provide the correct information or conceals certain information, then the financial planner cannot provide the client with the best service, as the planner will not not have all of the information at hand. The client has to open up about issues such as income, spending, personal assets, debt and financial goals.

To achieve this, clients have to be completely honest and could feel exposed; therefore a relationship of trust is fundamental for success.

The cultural taboo of talking about money is in direct contrast to the requirements of financial planning as a career choice.

Money communication

With this in mind, a research study was undertaken at the Centre for Financial Planning Law at the University of the Free State to gain insight into how financial planning students perceive communication about money, their own willingness to talk about money, as well as their biases about money communication.

These students are studying towards a career in financial planning and should therefore, be more open in their communication about money and money issues, as they will have to get their clients to open up about these matters in the future.

A quantitative questionnaire was provided to all of the undergraduate financial planning students and they had to indicate on a Likert scale, from one to five, whether they agree or disagree with the statements about money communication.

The results show that 39% of the students do talk about their financial situations or status, and only 27% feel at ease to give personal information about their financial affairs.

A remarkable 23% feel that money should not be talked about. This is an influential result as these students would have to get people to open up about their personal finances, but they feel that communication about money should remain a taboo subject.

Breaking the cycle

Significant results also specified that in order to talk about money, an individual has to feel that money should be talked about. Interestingly, comfort towards the subject is not a predictor of talking about money. Therefore, it indicates that it is not necessarily needed to feel comfortable, only that the individual should feel that it should happen.

If an individual feels that money communication is important, then he or she will try and talk about it. Also, the more an individual talks about money, the more likely he or she will lean towards the opinion that it is something that should happen.

For prospective financial planners specifically, it is imperative to break the social and cultural taboo of talking about money. These individuals should be taught how to feel comfortable about this subject and also how to make potential clients comfortable. It is time that we break this taboo on every level possible and create a platform of open communication with ease and comfort.