Five ways to make conversations about money easier
By Vicky Shaw
Many of us find talking about money to family and friends difficult. But given that many of us end up lending to - or borrowing from - loved ones at some point or other means it makes sense that we're able to have conversations about cash, so that everyone knows where they stand.
Informal borrowing like this is pretty common. A third (31%) of UK people have had to borrow money from family and friends at some part in our lives, a survey from Lloyds Bank UK suggests. Many of those giving informal cash loans may never see their money again - as more than half (53%) of the borrowers surveyed said they don't expect to pay it back.
The 'Bank of Mum and Dad' is the most likely source of informal financial support, lending an average of £4,008, Lloyds found. Meanwhile, one in 20 (5%) have borrowed from siblings and 4% from friends, with 3% seeking financial support from grandparents.
While some borrowers may be saving up for a specific goal, such as a deposit on a house, university costs or a car, others have been using the extra help just to get by. More than a fifth (22%) were borrowing money from friends and family to cover day-to-day living costs.
It might be a subject we generally tend to keep quiet about, and money worries can cause us lots of stress, talking about it can potentially relieve a lot of problems.
Martin King, head of customer support at Lloyds Bank UK, says: "Getting support from those closest to us can be a good solution, but the fear of opening up and talking to our family can either prevent us from ever asking or mean that we leave it until it becomes a situation that needs an urgent fix, which adds even more pressure.
"Whether you're asking for help from the Bank of Mum and Dad or talking to your parents about their plans for retirement, you should never feel afraid to speak up about money," Mr King adds.
Here are Lloyds Bank's tips to help make money conversations easier...
1. Be prepared
Sometimes it's hard to know where to start. Ahead of any conversation about money, it can help to gather all the information you need to allow you understand exactly what you need support with. It's useful to have items such as bills and bank statements to hand, so you can be clear and not feel like you have to remember every little detail.
For example, if you are struggling to get a deposit together for a home, it will be easier to start the conversation if you know how much you'll need to borrow and over what period. Once you've established all the facts, working out a plan for how you will pay the money back becomes much easier.
2. Decide on a time and a place
Choosing the right time and place to talk about money can make all the difference. Pick a time when there will be no distractions, so you can have a calm and considered conversation.
It may be that home isn't the right place to have the discussion.
Finding a neutral spot, particularly if it's likely to be a difficult conversation, can be a good idea. Also, sitting next to each other rather than opposite can reduce feelings of anxiety and encourage you to talk more freely.
3. Listen as well as talk
A calm exchange of views is a lot better than one person giving their point of view and not giving the other a chance to be heard. If you're asking for financial support, it's understandable that the other person might have some questions and concerns.
Understand and acknowledge the other person's point of view and be ready to answer their questions about why you need help, and any other options you've explored.
4. Make a plan together
Always try to reach an agreement about what to do next together. Two people can perceive information differently, so it is a good idea to note everything down to ensure you are on the same page, and to allow you to iron out any misunderstandings straight away.
If you have a shared goal, this will help you to keep each other on track and supported along the way.
5. Keep the conversation going
Sometimes the relief of having talked about money is so overwhelming that people don't mention it again, and forget to put words into action. Having regular conversations about money is really helpful, both for your finances and your relationships.
Make this a habit - not just a conversation you have when times are difficult.