Money can be awkward to talk about, but that awkwardness comes at a hefty price. Financial boundaries are guardrails that you put in place to protect your money. And it’s not just about protecting your cash — it’s about ensuring you have a comfortable, healthy relationship with money.
Unfortunately, your financial boundaries aren’t just about you. This is why, in many ways, making a budget is only a surface-level solution. In most cases, you’ll need to prop up certain guardrails against your friends, siblings, kids, and even parents. Whether they mean to or not, your loved ones may be violating your financial boundaries. These issues won’t go away, and unaddressed violations will, over time, only lead to resentment and tension. Here are some of the most common financial boundaries and how you can implement them, so you save yourself money and buy yourself peace of mind.
Identify your financial boundaries
Like with any kind of boundary-setting, the first step is knowing yourself and where you personally draw the line around different behaviours. When it comes to financial boundaries, let’s take a look at the different kinds of guardrails you might want to prop up:
- Sticking to a budget.
- Limiting certain areas of spending: dining out, clothes shopping, etc.
- Saying no to someone who tends to mooch off you.
- Setting a spending limit on gifts for others.
- Enforcing an allowance or limiting how much money your kids can borrow.
- Avoiding taking on any new debts.
- When someone asks for money, tell them you need a day to think about it, rather than saying “yes” automatically.
Sit down and think about your money comfort zone and how the people in your life may be inadvertently crossing your lines. Once you’ve identified those financial boundaries, it’s time to put them in action.
How to set your financial boundaries
Committing to your financial boundaries comes down to knowing yourself and effectively articulating what you need.
Keep the conversation clear and direct
Rather than letting resentment build and one day blowing up at a loved one, open the money talk now, and do it with grace. It’s hard to talk about money, but opening up a conversation will help relieve yourself of the shame that holds you back and traps you in an uncomfortable spot financially.
So start talking about it. What are your money goals? How did you wind up in your current financial state? Do you need to unlearn habits from your parents? Create the space for yourself and others to be more open about debt, overspending, and learning to say “no” to loved ones on different money issues.
Provide bigger context
When you’re setting your new financial boundaries, it helps to give your loved ones more personal insight into your financial journey. Share with them how you arrived at this turning point where you need to set boundaries.
You might be afraid about the damage a firm “no” will do to your relationship, but if you’re reading this article in the first place, these financial boundaries are important to you. Make it clear that for you, the “no” is bigger than any one line on your budget — it’s about your relationships and the boundaries you set with friends and family.
Be ready to stay strong
Your financial boundaries could lead to tension and resistance from others, no matter how respectfully you communicate your needs. Be prepared to meet that resistance. This might look like clearly stating your expectations in situations where money gets passed around. For instance, the next time you go out to dinner with a group of friends, be sure to communicate that everyone’s going to pay for their own share. The key is to avoid shaming anyone who might be impacted by your boundaries — reiterate that this is about you, not them. Send a clear message with fair expectations.
Sticking to any kind of money-related goal is tough. Luckily, with boundary-setting, you can get people in your court to hold you responsible. So, our final tip is to consider asking for back-up. Clearly express your boundary goals to people you trust, and ask them to help hold you accountable.
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