How to Have Awkward Conversations About Money With Your Friends

By Relationships Australia

Group of 4 friends cheers-ing with drinks in a bar.
For many Aussies, the purse strings are tightening as the cost-of-living increases. An NCOSS report released in March found that one million people in NSW are living in poverty. And, with Western Sydney going backwards while Eastern Sydney is improving, inequality across the city is deepening.

The ripple effect of having to watch our spending can infiltrate many areas of our lives, and our relationships certainly aren’t immune. If your financial situation is becoming more challenging, it can create uncomfortable tensions with your friends, especially if they aren’t on the same page as you.

That upcoming dinner at a fancy restaurant you’re already sweating about; scrambling to make the deposit for the girls’ weekend away; paying for multiple engagement, wedding, birthday and baby gifts. If you’re on the dating scene, the costs can add up even quicker – dinner dates, café outings, traipsing around town. And while there’s the possibility that the other person will cover your bill or go halves, this isn’t a strategy you can bank on.

Money talk can feel awkward, especially for those of us not comfortable admitting that we’re not as well off as others around us. Elisabeth Shaw, clinical psychologist and our CEO, says people who feel like they’re in the “outer circle” of the friendship group, or are more insecure in general, particularly feel the pressure to “keep up”.

“Shame or embarrassment about having financial issues can lead to covering up,” she adds. “You might also worry about looking ungenerous or stingy.”

Splitting the bill

While splitting the bill can be a less onerous task than every diner meticulously calculating what they ordered, it doesn’t tend to favour those on a budget. You had water, your pals had martinis; you stuck with an entrée, they had three courses.

“If this is an established pattern in your social groups, it may be worth analysing how often you end up disadvantaged, and how often you are on par – or even advantaged – by bill splitting,” says Elisabeth. “It’s easy to be more preoccupied by the time you feel a bit ripped off.”

Choosing the venue

It’s also worth thinking about whether you can influence the venues you go to. This can be tricky when there is already a tradition of visiting the same place, or someone else in the group is the designated organiser, and isn’t keen to relinquish their role.

But taking the lead can not only ensure the places you visit – whether it’s a restaurant, pub, holiday destination or event – are within your budget, but can also add variety to your social calendar.

“You could research some places and outings that are more financially accessible – others might go along with this quite happily,” says Elisabeth.

Speaking up

If you feel comfortable doing so, speaking up and admitting that you’re finding the cost of some socialising difficult can lead to greater understanding among your friendship group.

Good friends won’t want you to be in a difficult position,” says Elisabeth. “They won’t set you up by constantly booking something out of reach. However, if you have been covering up, they may simply not know how much it’s affecting you.”

The key is to be assertive and speak up early, rather than when the bill arrives. “Being confident in yourself and assertive can lead to others responding easily to your clarity. If you raise it as a tentative suggestion, others may not hear it in the way you intend and will talk you down.”

Admitting that you need to curb your spending could also result in offers of help – which are no doubt well-intentioned and may be welcome, but they can bruise your ego too. If a friend offers to cover for you but you don’t feel comfortable accepting, it’s okay to thank them for their generosity but decline.

“It can be important to clarify that you appreciate their offer, but prefer to pay your share and still be included,” says Elisabeth.

Being sensitive to others’ financial situations

Given the increased cost of living, it’s unlikely that you’re the only one having to be careful with money.

“Most people go through financial troubles at one time or another,” says Elisabeth. “It may be due to different earning power, saving for something special or being in a period of transition, which can all lead to temporary phases of needing to curb spending.”

Knowing you’re not alone can help reduce the awkwardness of telling your friends about your need to reduce spending.

“While you might be a bit embarrassed, most reasonable people will accept your explanation without any further comment and may even be glad that the established standards within your friendship circle can be challenged,” says Elisabeth.

Financial hardship can put a strain on our relationships, including our friendships. If you need support, we offer one-on-one counselling services. We pride ourselves on making our services accessible and have a sliding fee scale, based on your income. Fees may be waived in cases of financial hardship.

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