How to Handle Emotional Money Discussions
Our team has created a digital tool that brings financial therapy to the general public.
Coordinating finances with another person is difficult, even in normal times. Tensions may be especially high today, as more people are facing layoffs, pay cuts, and lingering uncertainty. Add to that the close quarters of sheltering in place, and you've got a recipe for some very emotionally charged financial conversations.
Financial Teamwork Is a Skill
Disagreements are bound to happen in any partnership, whether personal or financial. Money is especially tricky to discuss, though, because it carries heavy implications of personal, social, and cultural significance.
As I say in my book, money is quite possibly the most loaded topic of general conversation. Among other things, money symbolizes power, security, responsibility, and control. Money represents the opportunities and limitations we see for ourselves and our loved ones, and we each have our own views on how it should be managed, distributed, or prioritized.
Is it any surprise, then, that financial disagreements have been repeatedly linked to relationship stress and divorce? For guidance, some turn to family therapists, while others seek the help of financial advisors. Some hire both. Unfortunately, family therapists are rarely educated about money, and financial advisors rarely train in relational psychology. The mixed set of issues is what led to the development of financial therapy.
Financial Therapy Is a Real Thing
Don't let the name fool you: A person doesn't need to be in a financial or emotional crisis to benefit from financial therapy. Megan McCoy is a professor at Kansas State's graduate program in financial therapy. She says that she wishes people viewed financial therapy services more like we see auto maintenance services and less like a last resort. If you went years without oil changes, it wouldn't be surprising if the engine seized.
"We often assume we have to be broken or things have to be horrible to go to talk therapy," says McCoy. "But if we addressed our mental and relational health right away, we wouldn't have to live with weeks, months, maybe even years of struggling."
Certified Financial Therapists are financial planning professionals who also have deep training in mental health concepts and interventions. Because of their dual expertise, financial therapists can recognize unhealthy communication and attitudes as well as unhealthy financial behaviors. That helps them zero in on the issues that financial partners need to address and how to approach them.
With couples and families, financial therapists can help people to understand their own perspectives, values, hopes, and fears and talk about them in a way that's productive and solution-focused. When all parties can communicate their thoughts and emotions well, solutions are far easier to find.
Learn From the Pros
In your own money squabbles, you may not feel the need to call in a professional, but you can still take advantage of their knowledge.
Morningstar's Behavioral Insights Research and Development lab recently teamed up with financial therapists to create a digital tool that brings financial therapy to the general public. Building on a framework known as "narrative therapy," we've digitized the initial conversations that a financial therapist might have with someone needing a bit of light coaching in this area. The result is a self-help tool for couples who want to try a different way of approaching their financial disagreements.
Led by a robot avatar named Mo, "MoneyTalk" is a free, chat-style app that walks you through a few talk therapy sessions centering on the topic of financial disagreement. You're meant to do the first three sessions (they take about 5-10 minutes each) by yourself, so that you can examine your own thoughts and feelings about the issue first before involving the other person. Mo then supplies you with notes and tips from your solo sessions that you can use to support you when you bring the topic up with your partner. In an ideal case, both partners would talk to Mo first, and then to each other.
While a digital tool will never replace the services of a licensed and experienced counselor, MoneyTalk may still be useful to many. At the moment, we know that millions of couples are spending lots of time in close quarters while also under the strain of financial stress and uncertainty. If that is you, please consider registering for the beta trial of MoneyTalk. We would love to see if Mo can help.
If you are in a financial crisis at the moment, please seek out a professional therapist to help you through this time. If, on the other hand, you think you could turn your discussions around with a little helping hand, try talking to Mo. He's cute, he's a good listener, and he's just a robot, so he can't judge you.
If you want to try it yourself, we would be thrilled to have you try the beta version.