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when dealing with money

Why Friends and Money Don’t Mix

by Elizabeth Falke on December 19, 2012

It’s been said time and time again: friends and money don’t mix. GGF contributor Elizabeth Falke shares her personal story about how money and disagreements about money can ruin a friendship.

Her name was Laura; she was my boss; she was also my best friend – emphasis on the word was.

The arch of our friendship, from its beginning over lunch-hour talks over bad Mexican food to its horrible end, surprised us both. Although we worked in the same office, had husbands who worked in the same field, and cheered for the same sports teams, I never expected my best friend to be the person who told me what to do 40 hours a week.

It wasn’t a work conflict, though, that spelled the demise of our relationship. It was the drastically different way we handled money and, just as importantly, how we felt talking about money that spelled our doom.

When Your Best Friend is Your Boss

Since Laura was my direct supervisor, she was also in charge of facilitating my annual contract negotiations. In other words, she knew exactly how much I wanted to make as well as how much I ultimately received. And because Laura’s husband worked in the same industry as my spouse, she had a vague idea of how much he made, too. Basically, she had a pretty good idea of how much we were bringing in as a household.

While I also had a basic idea of how much Laura’s husband made at work, I had no idea how much Laura herself pulled in. At our company, it was strictly forbidden to ask a coworker about their compensation package; in fact, this was written in to our HR policy handbook. So while Laura knew everything about my salary, I could only guess at hers; I knew it was higher than mine, but I didn’t know how much higher.

Disagreements about how to spend money

At first, Laura’s hovering over my finances wasn’t a problem. I remember one time when we went shopping, and I was tempted to buy an overpriced pair of shoes. “You can’t afford that!” she told me, adding, “Remember, I know how much you make.” Maybe it should have felt patronizing – it certainly did in hindsight – but at the time, it felt like a good friend watching out for my bottom line.

Over time, though, Laura’s so-called “protectiveness” started to rear its ugly head in ways that were clearly out of line. She started making references to my financial situation in social situations, where she and I weren’t the only ones around. It made me feel self-conscious about not only my money, but about our friendship as well.

Meanwhile, Laura wasn’t practicing what she preached. Although she had no problem admonishing me for thinking large while living small, she was doing just the opposite with her own finances. This was back in the pre-housing crisis era, and I was shocked when Laura and her husband openly talked about buying a monstrous new house with nothing down. I wasn’t a homeowner myself at this time, but I’d read enough to know that zero-percent financing wasn’t the best option. She always leased her vehicles, and showed up every six months driving a brand new sports car. She wore the latest fashions, ate at all the trendiest restaurants, took lavish vacations; she also bragged that it was all on her credit card.

The End of a Friendship: Why Friends and Money Don’t Mix

After almost a year of close friendship, I couldn’t take it anymore. While Laura’s financial philosophy was that you only lived once, you might as well enjoy it (even if it meant piles of debt), mine was quite the opposite; I was a saver. I already had tens of thousands of dollars in student loan debt, and the thought of accruing credit card debt like it was water frankly terrified me.

Talking about money – or anything tangentially related to money – became a point of contention. Laura felt defensive whenever I mentioned it, and I felt the need to be secretive.

We’d already started to drift apart when I got a job offer in a new city. Thankfully, Laura hadn’t let our personal differences get in the way of an outstanding professional recommendation. I must admit, my decision to take that new job was heavily influenced by our failed friendship; it was too hard working with Laura, with so much water under the bridge.

Thanks to her, though, I’ve learned that when it comes to friends, the less you know about their financial situation, the better. Although our friendship ended years ago, I still take the lessons I learned from it with me into new relationships.

 

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