Why Talk About Money?

Arguments about money are a common problem in many families, regardless of income, age and education. Throw in the fact that the family owns a business together, and the potential for arguments increases two-fold. Why? Inadequate communication about money.  


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Arguments about money are a common problem in many families, regardless of income, age and education. Throw in the fact that the family owns a business together, and the potential for arguments increases two-fold. Why? Inadequate communication about money.

Many financial problems occur because all family members do not understand their business’ money situation. When family members don’t “talk things over,” even the most workable spending plan for the business is doomed to failure.


Values are the basic reason behind everything we do. Values shape our standard of what we want our life to be. We show our values in the way we talk and act, how we spend our time and effort, in our actions at work and leisure, and in our spending choices.

As individuals, we all have different values and attitudes toward spending, saving and investing money in the business. This is what makes each of us unique. When the values of family members differ, there is potential conflict. What are your values? What is important to you? It may help to list them from the most valued to the least valued.

If we determine what is important to us and why, our values become clear. These values influence how we spend our personal money and the business’ money. Values also influence how we save for important things and grow the company.

When there are differences in values within the family, you must try to agree on common goals. Talking about money is not always easy. The more open your family is about “money talk,” however, the more satisfied everyone will be with how the business money is spent.

Breaking The Ice

Keep these guidelines in mind when you talk with your family about finances:

  • Be honest about your business’ financial situation.
  • Know that each family member will have different values and goals.
  • Know that conflict may arise. Don’t avoid it. Learn to manage conflict. Respect family members’ differences. Work toward a decision agreeable to all.
  • State your wants, needs, feelings and thoughts. Allow family members to do the same.
  • Allow time. Don’t rush the person talking.
  • Use “I-messages” (I think…, I feel…). Avoid “you-messages” (you always…, I feel like you never…). I-messages state your own reactions. You-messages blame the other person and say, “I’m right.”

Listen to one another. Tell each other how you feel and what you think about what others are saying. Be sure you understand what others say.

Be flexible. If necessary, compromise your want for the good of the family business.

Emotional Uses Of Money

Money is powerful. It can bring out the best and worst in people, so understanding money’s influence can help a family gain control over their business finances. Insight into the emotional uses of money can help prepare a family to handle sensitive issues when they arise. Some emotional uses are positive: security, comfort, freedom, sharing, and so on. Some can work against a family, such as attempting to elevate status, increase self esteem or control others.

When emotional uses of money go unrecognized, trouble brews. Try to prevent it.

Family Council Meetings

One way to ensure family involvement in financial decisions is by holding family council meetings. These meetings help each member explore their own beliefs, values and wishes. They also offer the chance to voice complaints, ask questions and give suggestions. Decisions can be made in the family council meeting.

Plan family council meetings by keeping the following in mind: Arrange a regular time and place to meet and involve everyone.

How do you ensure success? Follow these guidelines:

  • Identify issues and stick to the subject.
  • Work for a consensus. Try to work out a solution that is agreeable to everyone. If consensus seems possible, try to postpone the decision for time to think cooperatively.
  • Once a problem has been solved, a written agreement of what each person has agreed to do may help avoid misunderstandings later.

The meetings and decisions made should involve only those family members in business together. We may not like decisions made by family members that are not active in the business.

Addressing Conflicts

When the family reaches a disagreement on a financial matter, the following decision-making steps may help you arrive at an acceptable solution.

Step 1: Define the problem. Be specific. List only one problem at a time.

Step 2: List ways the problem could be solved. Write down all possible solutions that come to mind. Don’t make judgements at this point.

Step 3: Evaluate each of the solutions in Step 2. Are they workable, practical and agreeable to everyone? Can you combine several alternatives?

Step 4: Select one solution. Outline the steps necessary to arrive at this solution.

Step 5: Identify obsticles that could prevent you from reaching your goal. How can you avoid these obstacles? Are you willing to sacrifice to solve this problem? Whose support do you need?

Living With Change

Change, confusion and conflict are part of everyone’s life. Many situations can influence, disrupt and change business finances. These include a slow economy, fast growth, adding more employees, succession planning—the list is endless. However, in each of these cases, all family members in the business should be involved in the financial decisions. This allows everyone to help grow the business in a cooperative manner.

To predict and deal with change as it affects the way money is used is a challenge to financial management. Clarify values, analyze potential causes of money problems, and develop communication skills to make money management a satisfying experience for your family-owned business.

These articles are reprinted with permission from The Family Business Report sponsored by the Goering Center at the University of Cincinnati College of Business Administration.