According to new research, Brits are losing almost £900 a year due to difficulties with having conversations around money.
With money conversations being a sensitive topic for many, the survey of 1,500 people in the UK, commissioned by Moneyboat, explored how uncomfortable Brits are when discussing their finances and the impact this has on them.
Brits lose £318 a year not asking for money back
It was found that a third (33%) of Brits admitted to sometimes not asking for money back after buying an item for friends/family as part of their purchase (i.e. a coffee or event ticket), with the average Brit saying this happens at least twice a month.
Furthermore, only 11% of respondents said they always ask their loved ones for their money back.
The survey revealed that Brits spend £318.91 a year because they feel they can’t ask for money back after buying friends or family something as part of their order.
Moneyboat has worked with finance expert Laura Rettie, Editor-in-chief of Finance, to look into why we find this topic of conversation so hard. “It’s hard-wired into our DNA that buying someone something small is a gesture of kindness, and asking for the money back would feel awkward and is simply not the done thing.
“The general rule of thumb is if you’ve been bought something, no matter how small or who by, you should always offer to pay them back. If they refuse, you can say something like, “I’ll get the next one then” to avoid any awkwardness.”
Furthermore, over a quarter (27%) of Brits attend social plans they can’t afford but feel too embarrassed to say so.
Looking at this impact, Brits lose out on £540.43 a year. Spend an average of £16.68 each time on social events they can’t afford and do this almost three times a month.
The hardest money conversations
When discussing money, the research revealed the conversations we find the hardest. The top five were:
- Asking for money back after lending to friends/family (38%)
- Asking for money back after footing the full bill for a meal (29%)
- Asking to pay exactly for what you had on a food bill instead of splitting it evenly (25%)
- Telling people you’re not able to afford something (25%)
- How much is in your bank account or savings (18%)
Laura adds: “Discomfort about money stems from fear of judgement – whether you have a lot or a little. It often feels inappropriate or impolite because parents traditionally hide conversations about money from their children, so as adults, we haven’t learnt how to discuss it openly with our colleagues, friends or partners.”
Expert tips on building confidence with talking about money
With Brits losing almost £900 a year due to awkwardness and embarrassment around money conversations, with the help of Rettie, Moneyboat reveals tips on becoming more at ease with money talk.
Be more transparent about your paycheck
Being more transparent about how much we get paid may help people struggling financially feel less alone (because millions of us don’t have savings and are in debt too). It will help you better understand financial products, saving you money and time.
Money is a sensitive topic, and many people feel embarrassed or ashamed about their financial situation. Show your friend or family member that you care about them, and that you’re there to support them, not judge them.
Practice discussing money with your loved ones to build confidence
Practice discussing your finances with loved ones to help you feel more confident, and use the internet to learn more about complex financial subjects. Be honest about your financial situation and don’t be afraid to ask your loved ones questions about their own finances (but expect them to feel uncomfortable at first).
Frame conversations around your financial goals to give them a positive outlook
Rather than focussing on the negative aspects of finances, frame the conversation around your financial goals and what you’re doing to achieve them. This can help shift the discussion from one of shame to one of empowerment.
Look for expert advice
Start to follow financial experts and bloggers on social media – many personal finance bloggers online give solid financial guidance for free. Make your financial health as much a priority as your mental and physical health.
If you or your friend are struggling with debt, budgeting, or other financial issues, don’t hesitate to contact a financial advisor, debt counsellor, or another qualified professional who can provide guidance and support.
Commenting on the survey, Daniel Saunders at Moneyboat says: “Conversations around money can be difficult for various reasons. However, it’s important to ensure that we feel empowered and confident to have these conversations, particularly with our research showing that Brits are losing money due to the awkwardness they feel around money talk.”