How Being Too Open About Money Can Backfire

When something is considered taboo, it’s hard to learn much about it. Money is a good example of this, and discussing it more openly is a good thing. But like most good things, too much of it can backfire. LearnVest explains how being too candid about money can be problematic.

Australian money photo by Shutterstock

It’s hard not to notice the trend of financial transparency. Sites like Glassdoor let you share how much you earn at specific companies. Personal finance bloggers share their net worth and specific debt goals. Usually, that kind of transparency is meant to accomplish something useful. You see how much you can expect to earn. You’re inspired by someone else’s accomplishments. You learn.

But Maggie Baker, author of the book Crazy About Money: How Emotions Confuse Our Money Choices and What to Do About It, tells LearnVest this openness can also backfire.

“People have a tendency to make social comparisons with others, and wonder, ‘Do they have more than we do? Who’s better off?’ ” Baker says. “But this line of discourse is not very productive.”

There’s a fine line between wanting to know someone’s details to improve your situation and simply wanting to make social comparisons. Of course, this isn’t to say we should keep money taboo. But there is a productive middle ground between too much information and censorship. Before talking candidly about money, Baker suggests asking what your motivation is:

“Ask yourself: Is your goal self serving? Are you insecure about your finances, and want to gossip about someone who’s worse off in order to make yourself feel better?” Baker says. “Or is your aim to gain useful knowledge and feedback?” Clearly, if it’s the former, you should zip your lips. But if your intentions are in the right place, then move on to step two — and follow a few ground rules to suss out who might be game to talk.

To learn those ground rules, head to the full post.

TMMI! Is the New Culture of Too Much Money Information Invading Your Life? [LearnVest]