 | | ILLUSTRATION: TAMMY LIAN | | |
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| So far in the course of this newsletter, we've been doing a lot of solo work. How to self-audit. How to plan for goals. How to enjoy frugality. Now, we're talking about connecting with others and how to initiate an honest conversation about finances. | | |
| And that means—Dun dun Dunnn!—talking to people about money. Expanding personal finance work beyond the borders of your own notebook, checklist and budget can feel uncomfortable. But it's necessary! You can think of it as intel-gathering. Without talking to my parents about how much they paid for their house, how much they saved for it and more, I'd never have known to reset my expectations appropriately (meaning, "OK wow this is not as achievable for me at my age as it was for them"). Without a dear work colleague sitting me down and walking me through his work salary history, I wouldn't have had the gumption to ask for a raise and chart my salary negotiations accordingly (i.e., "Whoa, people are making more than I expected in this office!"). And without friends opening up about the pricey reality of that "shabby chic" wedding budget, I wouldn't have thought to save that milestone for the far future (the very, very far future—do you know how much renting chairs for a reception costs?!). You may have already been having these talks with your partner or your best friend. Awesome! Great job. But have you had them with your parents? Your co-workers? A financial professional? Time to take our quiz and chat it up. — Julia Carpenter, Former Reporter, Personal Finance | |
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 | | WARM-UP: "Talk To Me" by Stevie Nicks | Don't think of this as a knowledge exam—it's more like a personality quiz. | | | | | | |
| 1. How would you describe your level of financial know-how? - I can talk ETF, 401(k), tax lingo and more.
- I can confidently budget and feel like I know the basics, but I want more!
- Don't judge me! I'm just getting started.
2. How often does money come up in your casual conversations? - All the time—and I'm the one who brings it up.
- Sometimes, but it never quite feels "casual."
- Every time it comes up someone changes the subject—sometimes, that "someone" is me.
3. Pick a short-term money goal. - Make sure I have everything I need for tax day.
- Performance evaluations are right around the corner, and I want a raise!
- I need to build my emergency savings fund.
4. Pick a long-term money goal - Take a career break.
- Live debt-free.
- Start my own business.
Your answers above point you to whom you should chat with about money! Mostly A's — schedule a consultation with a financial professional Mostly B's — find a co-worker or peer and have a frank conversation Mostly C's — time to call up the family | |
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| Savings Tip: | Find the common enemy. | | |
| Conversations about money can be less intimidating if you can find some common ground. When having difficult conversations with friends or family about money, identifying a specific issue that you both struggled with can be a helpful place to start. If you know your mom was once burdened with student loan debt, for example, that could be your entry point to a less tense (and more vulnerable) discussion about building credit or managing expenses. —J.J. McCorvey | |
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| ⏰ Suggested Time: This is an annoying answer but—how long this challenge will take depends on how the conversation goes! Getting started is the hardest part of any money convo. Because many people still view talking about money as the ultimate faux pas, bringing it up casually can feel less than natural. Feel free to use this newsletter as the entry point to your convo! Tell folks you're on a seven-week challenge and this is homework—we give you permission to roll your eyes jokingly if it feels appropriate. Before you bring it up, though, consider what you want to achieve in the conversation. Maybe you want to know how much a co-worker makes, or maybe you're talking to your parents about how they prepared for their retirement. Always remember that some people may not feel comfortable sharing details, and others can view a simple question as impolite or rude. "What closes down the conversation is blame or guilt or shame," said Megan McCoy, an assistant professor at Kansas State University's Department of Financial Planning. "So frame a conversation as 'What do you hope to accomplish?'" We've outlined a few starting points below, tailored to your quiz answers from the warmup. And even with Mom and Dad, remember to thank your conversation partner for their willingness and their honesty. As you remember from the top of this newsletter, these talks can feel awkward for all parties involved! | |
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| Talking with parents about your own goals and how they achieved theirs can always be a bit tricky. Parents may see your fact-finding questions as calls for help or requests for assistance, when you might mean anything but that by your inquiries. But there's a lot to learn, and you don't want to miss the opportunity to ask. Remember McCoy's advice: Be clear about your objectives on the front end. Try a script like this: YOU: Mom and Dad (or, alternatively, AUNT AND UNCLE or GRANDMA AND GRANDPA or BESTIE AND CO.), I've been thinking a lot about what I want in the future and what it is I'm saving my money to accomplish. I was wondering—would you be open to talking more about how you bought your first house? I am not asking for help, necessarily, but I realized I don't know that story and I'd like to talk about the steps you took to make it happen. | |
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| Bringing up money with a co-worker can be awkward. They could make much more than you do; or, sometimes more uncomfortably, much less; they could have financial obligations you never imagined; they could be getting help or assistance from places or people inaccessible to you. But it's important to discuss. If you don't know what your colleagues make or how much peers in your industry earn, you won't know what you're worth and your future negotiations will likely suffer as a result. Even if you have a casual, chatty relationship already established with a person, approaching this conversation in a more formal way is a good chance to set up expectations on the front end. Send an email or text first. Try this script to get started: | |
| Dear Lunch Pal/Work Colleague/Peer I Always Talk to at Industry Happy Hours, Hope you've been well since we last chatted! Reaching out because I'm approaching my performance review and I am hoping to ask for a raise this year. As I prepared for this review, I realized I don't know what other people at my level make in my company, and if you're open to it, I'd like to ask you about how you have seen your earnings change at different levels in your career. Would love to pick up the coffee if you're open for a virtual or in-person chat! | | |
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| If you answered mostly A's in the warmup quiz, you probably feel pretty OK in terms of talking about money. This is where talking to a financial professional can be helpful. Some people seek out financial therapists, financial advisers or other guides for specific money issues. Think about which one suits your needs, and ask friends or colleagues for recommendations. A lot of times you can find people willing to have first conversations or early consultations for little to no cost, but remember—they're serving their own interests, too. So be sure to do your research before you commit to following the advice of any one professional. As you read listings, look for fee-only fiduciary advisors and be wary of any big promises. Prepare your necessary documents ahead of time. How did you do your taxes last year? What confuses you about your retirement savings plan and the way it's set up? Do you have an HSA, and do you know how it works? Bring these all to the initial meeting. At the meeting, you can try this script to get the conversation started: | |
| I'm interested in learning more about [insert your chosen topic here] in order to [goal here] and want to know how I can make the most of my finances in order to reach that goal. To start, can you tell me more about how you've worked on this with other clients in the past? | | |
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| 🔮 COMING NEXT WEEK: See into the future | |
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| Was this challenge too difficult, too easy or just right? Give us your feedback, along with any tips you want to share with others who have subscribed to this challenge, by replying to this email. We'd also love to see your goals note, so please feel free to take a screenshot or a picture of it and send it to us—we'll be reading! This newsletter course was created and edited by Bourree Lam, Julia Carpenter, Robin Kwong and The WSJ newsroom. By submitting your response, you are indicating that your answers may be investigated and published by The Wall Street Journal and you are willing to be contacted by a Journal reporter to discuss your answers further. In an article on this subject, the Journal will not attribute your answers to you by name unless a reporter contacts you and you provide that consent. By submitting photographs or videos ("material") you agree that Dow Jones & Co., publisher of The Wall Street Journal, has the perpetual right to use, publish and modify the material in any medium. You represent and warrant that you own the rights to the material you submit, and that the material and any other information you submit are accurate and not false or misleading. | |
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