Breaking taboo: Ask your friends and family for financial advice

Last weekend, Kim and I went out to breakfast. The only other table in the small restaurant was a party of four youngish women who were laughing and having a good time. They were having such a good time, in fact, that it was impossible not to overhear their conversation.

“My dad is such a cheapskate,” one of the women said. “Last week, I drove my parents to Salem. I had to stop for gas, so I just pulled into the first service station I saw. ‘Are you sure you want to buy gas here?' Dad asked. ‘It's more expensive than the place down the street.' What a tightwad! He doesn't get that my time is valuable too. I'm not going to drive three blocks just to save a few pennies.”

The other women laughed.

“My parents are like that too,” offered a second young woman. “The other day, my mom was giving me a hard time because my husband and I like to go out to eat. We invited them to join us at Andina but she said they'd pass unless we went someplace less expensive. Can you believe that? It's not like my parents are poor. They're millionaires!”

Again, the other women laughed.

“My parents are millionaires too,” chimed in a third woman, “but you'd never know it. They don't spend their money. And they're always getting on my case about the money I spend. I'm like, ‘It's my money. Get over it.'”

Her friends nodded in agreement, and the conversation moved on. A while later, the waitress brought them their check.

“Oh crap,” the first woman said. “I didn't bring the right credit card. This one's maxed out.”

“I'll cover you,” said one of her friends. “But I'll need you to pay me back. I have just enough money to last me 'til payday.”

“How's your new house?” asked one of the other women.

“It's great,” she said. “We have so much room! I just wish we could afford to furnish it all right now.” Her comrades murmured in agreement.

“Wow!” Kim said after the women had left. “That was insane. You ought to write about that.”

“I will,” I said. “I will.”

Breaking taboo
It's all too easy to condemn people like this as shallow and short-sighted. That they don't get the connection between their spending habits and the fact that they're struggling with money is obvious. It's also obvious that they don't understand that one of the reasons their parents are millionaires is precisely because they're frugal. Being rich doesn't mean you spend more on gas when you don't have to or that you go out to eat in fancy restaurants all of the time. Rather, when you watch how much you spend on gas and you're careful about which restaurants you choose, you tend to build wealth.

This stuff is obvious, even to a casual observer.

What's more interesting to me is that that these young women had easy access to folks who are successful with money. Yet rather than pick their brains or learn from their behavior, they make fun of them! This is more common than it ought to be. In fact, most of the people I know who struggle with money have role models whom they could learn from — but don't.

In some ways, I sympathize. I used to be one of these people. When I was deep in debt, I was surrounded by folks who had things figured out (including my wife!) but I never bothered to ask them what I was doing wrong. It was only once I hit rock bottom that I finally reached out for help.

Today, it's different. Now I know that one of the best ways to improve my personal finances is to talk to others who have done what I want to do.

You see, it's taboo in our culture to volunteer financial advice. It's rare that a person will speak up to tell you what you're doing wrong. And when they do, you probably resent it. It's likely that your brother or your best friend is well aware of your weaknesses, but is unwilling to mention them for fear of offending you.

But if you take the initiative, if you ask your friends and family for financial advice, that taboo doesn't apply.

The best $20 you'll ever spend
If you want to know how to improve your finances, choose a financial role model and take them to lunch. Pick somebody you trust. Most of the time, these folks are obvious. They're the ones who never complain about debt, the ones who've accumulated a lot of savings. (Sometimes they have a nice house and nice car, but not always.)

In some cases, these role models might be family members or close friends. If you feel comfortable asking these folks for advice, do it. But you might feel more at ease if you talk to somebody who's merely an acquaintance: a neighbor, a colleague, a mentor. (In my case, I've learned a lot from my real millionaire next door.)

Invite your role model to lunch. Explain that you want to pick their brain about how they've managed to do so well with money. Tell them you want some advice.

Before you meet for lunch, prepare some specific questions. Do you want to know about investing? About increasing income? About cutting costs? Start the conversation by sharing your story — where you've come from and where you want to go. Be honest. Be realistic. If you're in debt, say so. Next, ask the other person about their story. How did they achieve their financial success? Based on their experience, what would they do if they were in your shoes?

Take notes. If the other person offers advice, don't take it personally. Listen with an open mind. Don't get defensive. If there are extenuating circumstances, feel free to share them but don't try to explain away every problem in your life. A lot of times, things that seem like external barriers to you are actually internal barriers.

At the end of the meeting, ask your role model if they have specific recommendations for your situation. Pay the bill, thank them, and go home to think about what you've learned.

Not just for beginners
This exercise isn't just for people in debt. It's also great for folks who are learning to invest, or for those who want to boost their income. When I thought I might like to get into rental properties, I invited a friend to dinner to ask him how he started investing in real estate. I've had dozens of readers take me to coffee so they could get my advice on their financial situation.

If you want advice about how you could improve your finances, ask your friends.

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Beth
Beth
6 years ago

I think this is great advice — especially for big decisions! I’ve been surprised at how many people are willing to share how they negotiated a mortgage, why they chose to buy a new car versus used, what stores/websites/coupons and other resources they have for saving money. I try to start a conversation with something along the lines of “I’m thinking of doing x, do you have any suggestions?” If people don’t want to talk about it, I’ve given them an easy out. They don’t have to give away personal details if they don’t want to. In turn, I think… Read more »

Curtis@PayOffMyRentals
6 years ago

I have the honor of being a mentor for a young women who is like a daughter to us. She is now married and so she is “mentoring” her new husband. Their vehicles are paid off. Their business (1/3 of our shared company) is debt-free. They have no consumer debt. She travels and enjoys life. She is absolutely nothing like the women mentioned in this post. However, that is not the path she was on originally. She comes from a long line of family members who overspend and save nothing. They are all in debt up to their eyeballs. She… Read more »

Olga King
Olga King
6 years ago

And this is why we miss JD here on this blog.

Jane
Jane
6 years ago

I make fun of my parents’ cheapness, but that’s mainly because there’s no pay off to their cheapness but more money in the bank. In other words, they don’t scrimp on the things that don’t matter to them so that they can prioritize those that do. They are paralyzed by spending money at all. This means that even if my mom tells me earlier that she craves a salad when we are on vacation, she nonetheless, when push comes to shove, buys the $1 burger (and only eats half!) at the fast food place, instead of the $4 salad. True… Read more »

Shelly Baur
Shelly Baur
6 years ago
Reply to  Jane

And you have perfectly illustrated the difference between cheap vs. frugal.

E.S.
E.S.
6 years ago

JD – great stuff, and always refreshing to see your thoughts on this site – quite the juxtaposition reading this article only days after more blather from an unnamed contributor with more rationalization of spending, spending and more spending. I don’t have a problem with different viewpoints and strategies – I like reading about all kinds of issues related to PF. I just prefer seeing a bit of honesty in the writing. JD has never claimed to have the answers and his writing always seems introspective…..he’s open to advice and he’s always willing to revisit past decisions he’s made. Thanks….more… Read more »

Vanessa
Vanessa
6 years ago

I don’t think I know anyone with money, and if I do, they won’t admit it. If I had someone IRL to get financial advice from, I wouldn’t read so many PF blogs.

Laura
Laura
6 years ago
Reply to  Vanessa

Same here. Last night I thought that I’d wasted a lot of time making comments on GRS on a topic of interest to me, and thought maybe I need to cut down on time spent here to free up time for other things. But I realize that I come here because it’s the ONLY time I “talk” with others about PF and it helps me stay as much on track as I do. I know no one in my personal life who has any apparent interest in the topic (I’ve raised it on a few occasions with friends, only to… Read more »

Sarah
Sarah
6 years ago
Reply to  Laura

I’m on the same boat as you… my husband and I are quite young mid 20s but we’re both on the same boat on PF, paid off student loan, live on budget, saving as much as we can now so that we can do as we please by the time we’re 40. Both our parents make well over the 6 figures but have nothing to show for it except for a mortgage that they are still paying off. Our “friends” or rather acquaintances love going out to eat on expensive restaurants, entertainment and blows their money on things. I’m lucky… Read more »

Mick
Mick
6 years ago
Reply to  Sarah

Sounds like you don’t have children? If so, please don’t forget your parents had the expense of a child/children. That doesn’t excuse bad financial decisions but it is HUGE expense.

Sarah
Sarah
6 years ago
Reply to  Sarah

Sounds like you don’t have children? If so, please don’t forget your parents had the expense of a child/children. That doesn’t excuse bad financial decisions but it is HUGE expense. Actually, I do have a child he’s two years old and no of course I haven’t forgotten that my parents had the expense of a child/children but having children does not excuse anyone of irresponsible handling of personal finance. Their my parents I love them and for all that they’ve done for me, but there is still a part of me that wishes they would fix their finances so that… Read more »

Sarah
Sarah
6 years ago
Reply to  Sarah

Actually, I do have a child he’s two years old and no of course I haven’t forgotten that my parents had the expense of a child/children but having children does not excuse anyone of irresponsible handling of personal finance. Their my parents I love them and for all that they’ve done for me, but there is still a part of me that wishes they would fix their finances so that I wouldn’t be burdened when their too old and have no money to cover their expenses but I guess that’s the cost of them raising me all those years 🙂

Julie
Julie
6 years ago
Reply to  Sarah

Mick–There are a lot of people with children making far less than Sarah’s parents that still save a portion of their income.

Besides, my parents comment how they weren’t up against stagnant wages and inflated real estate prices.

But everyone can always find an excuse as to why they are not saving.

Mick
Mick
6 years ago
Reply to  Sarah

Sarah–
I actually requested to delete my comment the moment I hit enter and for whatever reason it didn’t get deleted which is disappointing.
I didn’t want it to sound snarky and was worried it came across that way which wasn’t my intention.
I know there are a ton of variables to someone’s financial situation and good for you for recognizing the value in being careful and frugal when you are young. It’s the best way to go!

Becca
Becca
6 years ago

When I read this post, all I thought of was, I love Andina! I just went there for the first time two days ago when I was in town for business. However it is very expensive. I used to think like those girls (and have parents like those girls) but having blogs like yours encourages me to save. Thanks for writing!

Becky @ RunFunDone
Becky @ RunFunDone
6 years ago

I’m not sure that I have a financial role model – I suppose that this is partly due to the fact that it is taboo in our culture to discuss finances, so I don’t really know who has their finances in check! I have friends who sometimes quietly ask me for financial advice, but they never listen to a word I say! 🙂 I try to just continue to only offer advice if asked, but it drives me crazy when I see someone who’s just told me about their overwhelming credit card debt then decide to spend money on frivolous… Read more »

sarah @ little bus on the prairie
sarah @ little bus on the prairie
6 years ago

I’m curious to know how you find out how someone has their finances in check and isn’t simply portraying the image of wealth via massive amounts of debt.

Cherie
Cherie
6 years ago

While I found today’s post somewhat vague [young women who, unsurprisingly, don’t want to hear from their parents how to save vs go out and take someone to lunch who has their act together if you want to find out how to have YOUR act together]I think THIS is an excellent question. People with whom I’m not intimately involved have no way to know that I’m any different from most of my peers. I don’t carry a credit card balance – ever. I have no non-mortgage debt [and that’s only about 50% of my home’s value]. I have liquid money… Read more »

EC
EC
6 years ago

Also, sometimes someone will “talk poor” when they are out with people doing the same, but actually have money in the bank and a well defined budget.

Chase
Chase
6 years ago

In my county, property records are easily accessed as public record on a website. I recently moved into a newly built development, which is upper middle class for the area (but dollar for dollar, it is reasonable, as I live in a low cost of living region). I am nosey, and looked up the mortgage records of my neighbors (before judging me, who of you wouldn’t do the same?). The breakdown on down payment amounts is: 33% put down less than 5% 33% put down between 5%-20% 33% put down 20% or more Driving by these nice houses, I would… Read more »

victoria
victoria
6 years ago
Reply to  Chase

That’s not foolproof, though. If you looked up the mortgage we took when we bought our current house it would indicate that we bought it with no down payment via two mortgages — an 80% mortgage at one rate and a 20% mortgage at a somewhat higher rate. What that would *not* indicate is that we did so because logistical issues necessitated that we close on this house a few weeks before we closed on the house we were selling in another city in order to move here, and the 20% loan represented a very short-term bridge loan that was… Read more »

Sarah
Sarah
6 years ago

Honestly, I don’t think there’s any way of knowing. I worked for the bank for 3 years during my university days and I can honestly tell you there are people who look very good from the outside and have debts to show for it but there are also those that are so well of so that their lifestyle is warranted. I’ve also seen the opposite where the person isn’t fashionably dressed but is loaded with cash but there are also those that are just getting by. At the end of the day those who are financially irresponsible will show their… Read more »

Aldo @ MDN
Aldo @ MDN
6 years ago

I used to be one of those girls, always calling other people cheap because they had a lot of money and didn’t want to spend it, while I was spending the money I didn’t have. I see things different now and now have people calling me cheap while they’re more and more in debt. I try to help a lot of them, but all I get is “I want to enjoy my money, you can’t take it to your grave.” The reason I want to help you is so you CAN enjoy your money and not have to worry about… Read more »

Carleton
Carleton
6 years ago

Discussing one’s financial status and money practices, especially how how much money you make, your overall financial worth and how much debt you are carrying, is indeed a taboo topic in our culture. As a psychotherapist, full well knowing all that is said to me will be kept in strictest confidence, many people will not reveal such information (even when it has some bearing on the issues they are seeing me for),although they readily tell me long held, shameful family secrets, details of the affairs they are having, heartbreaking stories of their childhood sexual and emotional abuse etc. etc al.… Read more »

Ramblin' Ma'am
Ramblin' Ma'am
6 years ago
Reply to  Carleton

I wonder if some of this is regional. I grew up just outside NYC. My family was always really open about money. I have lived in New England since the age of 17, and people here are much more circumspect.

Or maybe my family is just unusual!

April
April
6 years ago
Reply to  Carleton

This is true of my experience, as well. When I was in debt, I didn’t want ANYONE to know about it. I’m type-A, a perfectionist, and the illusion that I’ve got my act together was just too important to me. So I figured it out on my own. Now that I’m debt free and on the right track, I still find it awkward and uncomfortable to talk about exactly how much I earn, how much I’ve saved, etc. When my husband and I sold property this year, I was very uncomfortable with anyone knowing how much we netted from the… Read more »

Alea
Alea
6 years ago
Reply to  April

When I was in debt big time, I let EVERYONE and their dog know it. But once I put myself back on my feet, I stopped informing people how well I am doing.

Being broke gave me sympathy, doing well will get me resentment. It’s very hard to find someone who is genuinely happy for someone who is doing well. Kind of sad.

I had no mentor either, I learned it all on my own.

Chase
Chase
6 years ago
Reply to  Carleton

I find it interesting that it is such taboo to talk about money since people probably have an idea about your financial situation anyways. All your peers know what you and/or your spouse do for a career. In addition, they can see the car you drive, the house you own, the clothes you wear, etc. Yes, you may fool them in some areas, but as a whole, they probably know ballpark where you are financially. They probably know if you are living outside your means, or they probably know if you are squirreling the money away in savings. It is… Read more »

Brian @ Debt Discipline
Brian @ Debt Discipline
6 years ago

I often tell people how I have gotten on track with our money and our recent success to see if they will bite, typically the conversation goes elsewhere. People just don’t like to money. It is rewarding to be able to help someone get on track. I have had the opportunity a few times with family members.

Amanda
Amanda
6 years ago

It took me a long while to find someone outside my family to talk about finances with. I knew my family managed finances responsibly because they helped me leave college with no debt. This help came from my parents and grandparents, no of whom had high paying jobs, but great habits. It was good family teasing that my grandmother’s gifts always came in a cracker box and were often from goodwill. When I came back from college and was going to be earning my own full-time income, my father showed me the budget binder he and my mother created and… Read more »

Alea
Alea
6 years ago

Yup, that’s my niece and her husband. Last X-mas I suggested they read “ALL YOUR WORTH” and they both pointed at the other person to read the book. Hmmm…. Then in February for my niece’s b-day, I bought her the book and gave her my copy Suze Orman’s WOMEN AND MONEY. I also put together a binder of articles on basic finance, retirement home ownership and other finance books she could borrow from the library. I also created for her a spreadsheet to keep track of her spending. After tracking her expenses through March she gave up. (I saw the… Read more »

Dianecy
Dianecy
6 years ago
Reply to  Alea

Sadly, providing this information to people who are not ready to hear the message does little good. In fact, it can make you look preachy and could even create a rift. I’d lay off with the suggested reading and just try to lead by example very, very quietly. It may or may not help them, but it will most certainly help you.
Even J.D. has said that it wasn’t until he hit rock bottom that he was open to the message.

Kamado Jim
Kamado Jim
6 years ago

Great post, JD. I especially like the advice to take someone, who you know is wise with money, out for a meal so you can pick their brain. Luckily, although my biological parents were not great with money, I grew up with a man (my stepfather) who was very frugal and invested wisely. He became incredibly successful (yet, still remained humble and frugal) while I was still young and because of that, I gravitated toward his approach to finances. Now, as my wife and I build a family and slowly acquire wealth, I look to him and know that the… Read more »

M
M
6 years ago
Reply to  Kamado Jim

Yay for step-parents! Many don’t receive the credit they deserve.

Jim
Jim
6 years ago

An enjoyable read. Thanks JD.

I think the key is finding the right person to take to lunch. In my experience, the people I know who talk about money and investing likely know the least about it. They talk a big talk, but when it comes down to it, they are really speculators and not investors.

Those that are financially successful tend to keep it to themselves and fly under the radar. See The Millionaire Next Door….

James Salmons
James Salmons
6 years ago

Years ago Ann Landers was read by almost everyone and discussed often. I remember her getting a letter from someone who complained how her friend was always making comments about having to be careful about what she got for lunch because she had gotten five pounds overweight. She thought the friend just did that to make her feel bad because she was more like fifty pounds overweight. Ann told her she was wrong. It was just that her friend was not fifty pounds overweight because she didn’t let herself get more than five pounds overweight. I think it is the… Read more »

nicoleandmaggie
nicoleandmaggie
6 years ago

Having an econ Phd is probably a bit like being a medical doctor… I get to hear all sorts of personal things from other people when they find out what I do for a living. I live in an no-taboo zone when it comes to money.

Ben @ The Wealth Gospel
Ben @ The Wealth Gospel
6 years ago

That story makes me want to laugh and throw up at the same time. Their parents are wealthy precisely because they drive across the street to pay a few bucks less in gas or choose to eat at inexpensive restaurants (if they go out at all).

Louise @ Good Financial Choices
Louise @ Good Financial Choices
6 years ago

Have to say it’s still a big taboo in the UK too, most people don’t think it’s appropriate to talk about money – debt is considered shameful and wealth even more shameful!

I’d love a role model, but in real life I’ve never come across anyone open with their finances.

Teinegurl
Teinegurl
6 years ago

What is if you have no one in your family to talk and your friends are in the same boat you are?

Alea
Alea
6 years ago
Reply to  Teinegurl

It’s never to late to learn. I had nobody to guide me either, so I learned on my own. Start by reading blogs like this, articles and books (go to the business section of the library) and before you know it you will be informed about your money choices.

Read a good article or a book and share with your friends, you might be suprised how many also don’t know there is plenty of financial knowledge available if they are interested.

The hard part is to have people take the first step.

getagrip
getagrip
6 years ago
Reply to  Teinegurl

I’ll echo Alea’s reply and say I didn’t get a heck of a lot of solid guidance either and learned a lot on my own. Many times people find themselves being the first to seek out a different way of living. If you begin by teaching yourself, and better positioning yourself and earning your own success, maybe you become the mentor (even if it’s just by example). I’ve found myself financially mentoring my in-laws by default (and I’m no paragon of perfection here). There is no one else in their family they can ask a question of that type and… Read more »

Patrick
Patrick
6 years ago

As someone above mentioned, there’s a difference between being frugal and cheap. My FIL can be really cheap depending on what he’s spending his money on. I remember one year, he was complaining to me about having to pay $180K in capital gains tax due to some stock options he cashed in (had to be around $ 1 million in value). That same year we had our 3rd child. My FIL told us that due to their now being 3 grandkids, he’d have to cut the Christmas gifts limit from $30 to $25 per kid. We had to laugh.

Chenell
Chenell
6 years ago

Wow, you think they would have realize WHY their parents were all millionaires after they all came to the same conclusion. Kind of funny to hear, thanks for sharing!

Dianecy
Dianecy
6 years ago

To everyone who despairs of finding a mentor, I’d recommend the forum here and the one over at MMM, which is even bigger. There are a ton of folks who will answer your questions. You can ask specific questions, post case studies, keep an online journal and much more. The posters are generally most helpful, because they have been there, done that. Plus, you have the anonymity of the internet. Money taboos are virtually non-existent.
If you’re feeling all alone out there, the forums are a fantastic resource.

Prudence Debtfree
Prudence Debtfree
6 years ago

I used to be one of those young women – decades ago now. And my parents were fabulous with money. But the topic of money was never discussed. It had a taboo aura around it even in the household. I certainly didn’t learn by osmosis. And I didn’t learn by being bailed out. I learned, as Roth did, by hitting rock bottom – at which point the advice a friend had been trying to give me for years sank in. We’re now on our way to debt-freedom – and we are talking about money in our own home – not… Read more »

Debt Hater
Debt Hater
6 years ago

My parents actually usually accuse me of being cheap! But they are smart with not going to the gas station right off the highway that is usually 10-20 cents more per gallon and they always advised me to pay off my credit card in full and only spend what you have.

I usually don’t talk about my finances with my friends that much, but I do tell them I still have my student loans when they want me to spend money on expensive things, etc.

debt debs
debt debs
6 years ago

People won’t seek out others because it’s too embarrassing to admit where they have got too. Once they hit rock bottom, they turn to PF blogs because it’s a way to figure out what to do in a incognito manner. After they have started turning things around, then they are willing to be more vocal and talk about it. You can bet those four women do not spend anytime looking at anything Finance on the internet though, more like shopping sites, fashion blogs, home decor – all the time lamenting about why they don’t have more money. In order to… Read more »

A Frugal Family's Journey
A Frugal Family's Journey
6 years ago

Great advice but with one caveat…you only ask your friends or family members who appear to have made the right financial decisions. Otherwise, your just getting an opinion with little merit. Just saying. 🙂 AFFJ

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