Should you speak up when you see bad money decisions?

When family and friends in your social network lack good financial judgment, do you butt in or stay out?

On any given Sunday after church services, fellow parishioners seek me out to ask personal-finance questions. I will, when I have time, try to help on the spot.

But I’ve always found it frustrating that strangers often see the value of my financial wisdom more than the people closest to me.

So, what’s a financially astute person to do when watching co-workers, friends or relatives make monumentally bad money decisions? Such a quandary was the subject of a question I received from a reader during a recent online chat.

“What advice do you have for someone with a longtime friend (mid-40s) who doesn’t have the best finances and lacks reserves? I don’t want to ‘finance shame’ this person, but how do you address these issues and start a meaningful and well-intended dialogue with someone about getting them headed in the right direction?”

As much as you care, you can’t make grown folks do right. And often your advice — no matter how well-intentioned — can seem smug.

In my younger years, I was the self-righteous, butt-in friend and relative who tried to steer people to better decisions. I’m a natural-born penny-pincher, so it just seemed crazy to me that folks would go on vacation without having an emergency fund. Or I would question why someone was buying a new car when they could repair the one they had.

I would — without success — discourage people from buying homes that I knew would stretch them to their financial breaking point.

After I had children, my social circle increased to include a wide network of other parents. I was dismayed at how many overindulged their children. When I’d ask if they had established a college fund, they would admit that they were saving very little or nothing at all. Yet many of these same parents complained that their children were being deprived of need-based financial aid for college because they made too much money. Their resentment was ridiculous to me when they had the means to save — at least something.

And don’t get me started on the ill-advised decisions to send their children to colleges they couldn’t afford without decades of student loan debt. Too many times to count, I lost this battle to bring them to their senses.

I became increasingly exasperated that the people who know I meant well just wouldn’t act on my advice. Their financial struggles weighed heavy on my heart, as if I had failed them. I write about personal finance for a living, so no one in my sphere of influence should be financially reckless, right?

However, with age comes the wisdom that I cannot always be my brother’s — or substitute any close relationship — keeper. Sometimes people have to fall flat financially before they get up and make better choices.

Or maybe they are living paycheck to paycheck, and all your advice does little to address the core issue, which is that they need more income.

So when should you butt in when your friends, family and colleagues lack good financial judgment? Here’s when.

After being asked. You have an increased chance that your advice will be taken if your opinion has been solicited. Once the door is open, provide guidance. But don’t be a bully about it.

You suspect a scam. Step in immediately if you think someone is about to be scammed. This becomes your business. This is definitely the time that if you see something, you should say something.

Any fallout may affect your finances. Let’s say your mother is a bad money manager and you know that if she doesn’t become a better financial steward, you’ll have to rescue her when she retires. And you will, because she’s your mother.

It’s OK to step in with advice if it’s likely that it will cost you more to help down the road. Share your concerns. Be candid about your fear of not having enough money to bail someone out if that’s the case. Also, communicate clearly what you’ll be able to afford should your family member or friend fail to change. Then don’t cave if you know the person didn’t take your advice. You don’t want to facilitate irresponsible behavior. If you do, you become an impediment to their growth.

If you’re the financial guru in your social network, make it known you’re willing to help, and do so without being judgmental. However, if folks exercise their free will to mess things up after you’ve given them good advice, don’t blame yourself for their fall.

— Washington Post Writers Group

Talk to us

More in Herald Business Journal

With the Olympic mountains in the background, the first passenger flight by Alaska Airlines Flight 2878 departs for Portland on opening day of the Paine Field Terminal on Monday, March 4, 2019 in Everett, Wash. (Andy Bronson / The Herald)
Snohomish County airports get $5.5 million in federal grants

Paine Field will receive $5.4 million. Arlington’s airport and Harvey Field each are getting $59,000.

Tim Keating, Boeing executive vice president of government operations and a member of the leadership council, speaking in 2014 at the Governor’s annual Aerospace Summit in Everett. Keating was abruptly ousted Monday. (Ellen M. Banner/Seattle Times/TNS)
Boeing ousts its longtime chief lobbyist in Washington, D.C.

Chief Executive Dave Calhoun’s memo provided no explanation for Tim Keating’s sudden departure.

This condo on Norton Ave. in Everett was sold Friday, June 18. (Sue Misao / The Herald)
Snohomish County home values soar in latest assessment

Lack of affordable housing put the squeeze on buyers and drove up home prices across Snohomish County.

Pilot Dan Tarasievich lines up for a landing at  Arlington Municipal Airport after a morning of flying with friends on Saturday, April 20, 2019 in Arlington, Wash. (Andy Bronson / The Herald)
Could Snohomish County’s two largest airports be expanded?

A study explores expanding runways at Paine Field and Arlington Municipal to relieve a coming crunch.

With credit scores out, will insurers cut or hike your rate?

Lack of affordable housing squeezed buyers and drove up home prices across Snohomish County.

FILE - In this May 5, 2019, file photo Warren Buffett, Chairman and CEO of Berkshire Hathaway, smiles as he plays bridge following the annual Berkshire Hathaway shareholders meeting in Omaha, Neb. Warren Buffett made a $4.1 billion annual philanthropic contribution and said he’s halfway through his goal of giving away most of his money. The billionaire investor also said he is stepping down as trustee of the Bill and Melinda Gates Foundation as he exits all other corporate boards. (AP Photo/Nati Harnik, File)
Warren Buffett resigns from Bill and Melinda Gates Foundation

The billionaire, 90, has also begun stepping away from his leadership role at Berkshire Hathaway.

pizza with cheese. vector illustration on white background
You voted: The best pizza in Snohomish County

Even during a pandemic, people still have their favorites

FILE - In this June 19, 2015 file photo, Department of Transportation Federal Aviation Administration building is seen in Washington.  The Federal Aviation Administration said Wednesday, June 2, 2021 that Ali Bahrami, the head of FAA's aviation safety office, will step down at the end of June. Bahrami was among FAA officials who were criticized by lawmakers and relatives of passengers on Boeing Max jets that crashed.  (AP Photo/Andrew Harnik, File)
Latest FAA reform gives workers new way to report safety flaws

The Voluntary Safety Reporting Program was spurred by the two fatal crashes on the Boeing 737 Max.

The final version of the 737 MAX, the MAX 10, takes off from Renton Airport in Renton, WA on its first flight Friday, June 18, 2021. The plane will fly over Eastern Washington and then land at Boeing Field  (Ellen M. Banner/The Seattle Times via AP, Pool)
Boeing’s newest version of the 737 Max makes first flight

The Max 10 took off near Seattle for an expected two-hour trip.

Most Read