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When You Earn Less Than Your Friends

Holding on to friendships despite wealth gaps.

Key points

  • Talking about financial disparities in friendships is difficult because of cultural taboos and stigma.
  • Emotions about money and hiding the stress of financial comparisons could cause loneliness and anxiety.
  • It helps to have honest, thoughtful conversations with friends if finances interfere with shared activities.
Source: PixConferenceSNCRGroup/Pixabay
Source: PixConferenceSNCRGroup/Pixabay

We live in a world of economic disparities where money is a touchy topic. Friends are generally reluctant to talk about financial differences between them, although millennials are more open about finances with their peers than boomers. Still, a recent Business Insider poll reveals that millennials would rather talk about politics than their own finances.

Hiding the strain of our financial stressors and silently suffering as we compare lifestyles on social media is a common cause of loneliness, anxiety, and depression. Longstanding research confirms that socioeconomic inequalities in society are significantly linked to an increased risk of poor mental health. Nearly 40% of millennials spent money they didn’t have and went into debt to keep up with peers, according to a Credit Karma/Qualtrics survey.

A wealth gap between friends can create tension, conflict, presumptions, resentment, or shame, causing rifts that tear apart well-meaning and loving relationships. A decades-long friendship could be lost over a bitter misunderstanding triggered by financial disparity.

As a single boomer who works as a writer and juggles side hustles such as teaching poetry at senior centers, I’ve watched most of my peers move into more comfortable retirement lifestyles. I’ve also tended to work with millennials and Gen Xers who struggle as artists, teachers, small business owners, social workers, and human services workers—and we all earn less than our peers. We’ve made calculated and careful decisions to stick with our values and callings and adapt to living within our modest budgets. Although I’ve witnessed the end of friendships because of a widening wealth gap, I’ve seen some bonds grow stronger as people can be enormously resourceful when they include friends from different backgrounds in their circles.

Many of us have found solutions to the challenges of socializing with our better-off friends. I’m fascinated in what holds friendships together despite wealth gaps or other stressors such as career changes, status changes, retirement, medical conditions, relocation, and other isolating factors that divide connections. I’ve learned how friendships are saved when someone reaches out to have an honest, compassionate conversation about that silent elephant in the room.

Coming from firsthand experiences and from research on wealth gaps in friendships, I can offer practical suggestions for having “the conversation” about financial disparities in our friendships.

Before Talking About Finances With Your Friend

Be mindful of your own assumptions (or biases) about people who have more money than you. It helps to identify the stereotypes or beliefs that interfere with your ability to see the situation clearly. Examples:

  • Assumption: “My friend Lisa has had a much easier life than I’ve had.”
  • Reframe: “Lisa has had other struggles in her life that are not financial problems.”
  • Assumption: “She’s so clueless about what it’s like to be broke.”
  • Reframe: “She has had a more sheltered life than me in some ways, but she is not judgmental about my lifestyle.

Check in with your own emotions and get to the root of your attitude about friends who are financially better off than you. What about them specifically triggers you to feel resentful, envious, hopeless, ashamed, guilty, or stuck? And further, your strong emotions might reveal underlying issues that are clouding the money problem in your relationship. (You might admit that you've got a nasty old chip on your shoulder about someone wealthy who shunned you a long time ago.) Example:

  • Resentful/Angry: “Lisa seems clueless when asking me to meet up at a pricey restaurant when I have to drive two hours to visit her in her hometown. Couldn’t she offer to help pay for the gas or at least pay for my drink? It’s not fair!”

Explore the qualities of your friend and why you want to stay friends. Lisa may seem naïve or oblivious about people who financially struggle, but she is a loyal friend who has a fresh sense of wonder and curiosity. I enjoy her creativity, her paintings, and her love of art.

Be proactive about how to present the issue to your friend. You will likely be the person speaking up about the problem.

Clarify what you need to say and frame it in a way that is workable for your friend—without blame. You might not be able to change your friend’s beliefs or values, but your friend might work with you on ways to meet up. (You might try writing out your “script” in a journal for what to say.) You can refer to the delicate subject by saying “it’s not in my budget,” which is a good, simple explanation that works for most occasions. “Lisa, I really want to see you, but it’s not in my budget to travel these days. It could help me out if we split the cost of gas when I drive to see you. Or maybe we could meet halfway somewhere so we each just drive one hour?”

Talking With Your Friend

Be specific about the financial issue in how it affects your friendship. It’s better to start the conversation with a specific example of when the issue comes up. Try not to overwhelm your friend with a multitude of financial issues but keep it concrete to what is solvable and workable.

Ask for their input and listen. Be willing to get your friend’s input. You might even be surprised with what they come up with or how much they do understand your situation.

Take a problem-solving approach and be open to creative solutions. Be willing to brainstorm on ways of saving money, saying “What if we tried doing….” (saying “we could try this” instead of “you should do this”). Your effort to try less expensive ways to meet up will reinforce your sincere interest in staying friends. Some common solutions:

  • Hike a trail or walk together in a park.
  • Have a picnic in the park.
  • Attend a free lecture or author talk.
  • Invite friends over for coffee, ice cream, or wine and cheese.
  • Potluck meals.
  • Chill with Netflix or watch sports events.
  • Play with your pet(s): frisbee, balls, games.
  • Host crafting sessions, book discussions, games.

Show gratitude to your friend for listening, caring enough to talk, and problem-solving. Hopefully you will get past the financial hurdles, but if not, at least you are clear about the truth of the situation and can make a more informed decision on the next step.

In conclusion, there's good news to report from a massive, hopeful, new study about cross-class friendships. Keeping friends from different walks of life is vital for upward mobility. Across the country, the study’s findings on the importance of cross-class friendships were consistent: “'People obtain job opportunities, information, and behavioral norms from their networks, and thus their outcomes are heavily dependent upon those of their friends and acquaintances,' explained Matthew Jackson, a professor of economics at Stanford University and one of the lead authors of the report.”

We help our communities when we hold on to friends who live in different socioeconomic levels or lifestyles. It’s good for democracy as well as our well-being. Our friends with differences help us stay agile and open-minded in an uncertain and fast-changing world.

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