Don’t Go It Alone: 3 Steps to Start Talking About Debt With Your Friends
You have a book club, a networking circle and that girls night out crowd.
But do you have a debt group?
That’s the monthly gathering of friends who are in debt.
Considering household debt topped $14 trillion in the fourth quarter of 2019, you probably wouldn’t have trouble finding members.
A debt group may not be as popular as the usual happy hour, but it could be especially helpful for women dealing with debt, according to Certified Financial Planner Hali London, lead planner at Facet Wealth.
Why women in particular?
Women held nearly two-thirds of the outstanding student debt in the United States as of early 2019 — that debt can affect their credit rating and thus the interest rate they can get on everything from credit cards to mortgages.
And the average woman still earned 85 cents per hour for every dollar a man earned as of 2018, which might also help explain why they have more trouble paying off accumulated debt.
Plus, sometimes it’s a matter of mindset.
“I seldom hear male clients say, ‘Oh gosh, I can’t believe I had to take on this credit card debt,’” London said. “Debt is something that they’re doing because they see it as a means to something bigger, whereas women really do tend to take it very personally — ‘I can’t believe I couldn’t make my budget work.’”
But if you’re hesitant to bring up your outstanding credit card debt at the next movie night, we have tips for how to start discussing debt in a way that helps everyone involved.
How to Discuss Debt Among Friends
Here are three easy steps to take to start discussing debt with friends in a healthy, helpful way.
1. Choose Your Group Carefully
Picking your group shouldn’t necessarily be about how much money anyone has. However, your minimum wage-earning friends might not want to hear the sob stories of high-powered execs complaining about the mortgage payments on their vacation homes.
It’s not that anyone needs to be ashamed of their debt, but consider who will be supportive and understanding of each other’s financial situation.
“It’s really hard to say, ‘I’m still struggling after all these years, I still have student loans,’ to the person who is making three, five, seven times their salary,” London said.
When considering who to invite, think about which personalities and income levels will mesh well together. And that doesn’t necessarily mean you’ll stick with the gang you’ve always hung with.
Sometimes creating groups with a bit of emotional distance can actually be more beneficial, according to London, who has clients that meet once a month.
“They’re not necessarily socially friendly as much as they are a support group,” she said.
2. Decide How Much You Want to Share
Before scheduling a time for your group to meet, ask yourself this question: How comfortable do I feel sharing personal info?
As a starting point, think back to the last time you went out with your friends.
“The same way that sometimes we share personal details about our own relationships, then we realize later maybe that was a little TMI — give that some thought ahead of time,” London said.
It’s tough to get very far with a debt group if you’re not willing to share any financial info. However, that doesn’t mean you need to reveal your bank statements to enjoy the benefits of the group.
“Perhaps a good way to bridge that gap is to say, ‘The amount it takes to service my debt is X% of my monthly income,’” London said. “That way you’re sharing what’s really important about it… without getting into details that you could regret later.”
3. Pick Relatable Topics
How do you get a group of friends excited about meeting to talk about a topic like debt?
Wine and cheese may help. So can a fun, relatable theme.
You can look to Penny Hoarder debt articles for ideas to focus the discussions, but keep the agenda informal. London suggested making one month about swapping funny stories that allow you to commiserate over past debt mistakes while still taking away lessons.
Don’t go further into debt when your group meets — take turns hosting at each other’s houses for potluck nights to avoid overspending.
The purpose of every meeting doesn’t necessarily need to be goal oriented. But by bringing specific stories about dealing with debt, your bunch can share experiences and encourage each other to try new tactics for approaching their debt.
“Sometimes hearing the challenges and successes that other people have helps people be more willing to try that thing themselves,” London said.
Tiffany Wendeln Connors is a staff writer/editor at The Penny Hoarder. Read her bio and other work here, then catch her on Twitter @TiffanyWendeln.