When it comes to anything money-related, tough love is rarely the way to go.
We all know someone who seems unable to control their spending or make good financial decisions. When that person is someone you care about, it's understandable to want to help them better manage their money. However, simply telling them to "be more responsible" is rarely effective. For many people, talking about money can get real awkward, real fast, whether it's saying no to someone who tends to mooch off you or learning how to heal your own relationship with money. If you feel a little out of your depth, let's take a look at some ways to help out a loved one who isn't great with their money, without making anyone uncomfortable.
When it comes to anything money-related, tough love is rarely the way to go. Rather than coming at someone with criticism or lecturing, try having an open conversation to better understand their underlying feelings and perceptions about money so you can determine the best ways to help. As I've argued before, we all have a money story—and it’s never as simple as “I’m bad with money.” Listen attentively to feelings like anxiety, inadequacy or even defiance that influence their financial habits. Try to get to the root causes.
Ask how they would like their financial situation to be different in an ideal world. What specific goals and timeframes can you mutually set? Write these downs and determine what initial steps they can take to start working towards these goals. Offer to periodically review progress without judgment. Remember that you're not their financial advisor, but an accountability buddy.
Provide tools that help build financial literacy at their own pace. Again, I'm not saying you should be anyone's financial advisor, but there are plenty of trusty apps that can give your finances a boost. Other resources could include books, articles, budgeting apps, online courses, or even offering to meet with a financial advisor together to discuss developing better money management habits. For more, here are some of the best apps depending on what kind of spender you are, or based on your savings goals.
When they take positive steps, offer frequent encouragement to build self-efficacy and motivation. Be their cheerleader! If they share small wins like sticking to their budget for a full week, recognize these achievements sincerely. Progress takes time, so patience is necessary.
The most constructive thing you can do is help the person build discipline and skills slowly through compassionate support. At the same time, protect your own peace by setting financial boundaries for yourself. Avoid criticism or control, and focus on boosting confidence along their journey towards financial responsibility. With help, almost anyone can become better at managing money over time.
