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August 10, 2010

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Other than my wife as few people as possible. Even my mother and father.

I also teach my children to try not to judge people by their money. Especially when they could be viewed to lack for nothing and we go places and vacations there friend do not.

Be humble I say.

You mean other than the internet?? ;-) We keep it to really close friends - but unfortunately we have a dozen of them.

My children know so that they can participate and understand why we give our money to those in need. We hope they also learn to sacrifice for others in need through discussing it with them.

I keep my finances private. I was lucky to find a field where I was grossly over paid, otherwise I would be probably be struggling like a lot of people I know.
In my practice I offer investment advice without asking a lot of questions about personal finance. I find people like that. many people won't approach an advisor because they know there will be a lot of questions about stuff they don't want to answer.
Tell me approximately when you want to retire, the size of your nest egg, the goal of the money we're looking at and I'll show you how big it will be under various scenarios including savings amounts and we'll figure out how much risk to take.
Your story reminded me of an extreme example I saw on tv where the teen was saying the family was poor because they didn't have as many big screen tv, SUVs in the driveway, and video games as her friends had. She of course lived in a mansion.

I learned as a pup not to share my financial status. When I was a young adult making little money, I mentioned to my boss that I had managed to put $1000 in a money market account -- a king's treasure in my mind. But he was the sort who lived paycheck to paycheck and didn't appreciate that his young assistant was doing better than he in the financial world. It didn't end well.

My father knows I have a nest egg and I shared it with a good friend because she needed help understanding how to build wealth. My brother knows in general terms, and begrudges me for it. Beyond that, I rather get a laugh out of people thinking I'm in a tough financial position. I commiserate with their tales of woe. I empathize with their hatred of those credit card bills. Inside, I'm smiling.

My kids probably won't know the extent of things, and that's fine with me. My parents do know pieces, but that's because they're doing well themselves and so there are no issues that could arise. However, we don't share specifics with any other family and avoid all mention of our finances with the in-laws. This is mostly because we know how they handled their finances and 1) we don't care to hear their advice since they're situation shows that we shouldn't listen, 2) we don't want to be asked for anything, 3) it's really no one else's business but our own.

Very interesting article!

This is part of the reason why I use an alias online (that and I think Mr. Krabs is just hilarious). This is also why I don't talk about my net worth to anyone in real life either. Yes, I don't tell anyone in real life... but mostly because there's just no reason to do so right now.

I do have a friend who loves to pry, and it does bug me, but I guess he can't help it. That's the most trouble I've had so far.

I will say that I know one person who has been harassed for having money in real life, because she tried very hard to tell everyone who will listen to save money, but when the recession hit, and they're doing poorly while this friend was doing well, I guess they got upset that she's doing so well and turned on her.

I know another who actually received death threats. I have no idea what happened to her. She just went completely offline one day. As far as I know, she's fine, but I guess she doesn't trust anyone online anymore.

So, I guess you do have to be careful out there.

Wait! You mean "Eugene Krabs" is an alias? I thought I had the real Mr. Krabs here at FMF! Darn!

I could just envision you at your computer saying, "Money. I love money" over and over. ;-)

I find it interesting that you asked "Is it any wonder this happened? Wasn't she asking for it by telling everyone within earshot?" I say it is surprising. Why would anyone expect to be kidnapped? It's almost as if you're saying the owner is partly to blame for this...when in fact she never asked to be kidnapped. Really it just shows that we have members of society that have little to no morals.

That being said my wife and I are the only ones who know 100% of the details. Over the years I've to constantly tell my father he has no need to know how much I, or my wife, make and that has offended him greatly. Unfortunately he likes to compare himself and his kids against each other. While my kids will not need to know how much I make or save they will not be kept in the dark on savings, investing, and tithing.

For us, nobody knows everything except me. I wish this were not the case; I try to inform my wife on our assets, liabilities, income, and spending, but she really doesn't like it and prefers to have me handle our money. I do "force" her to sit down with me once every month or two to make sure she knows the overview.

It is actually quite awkward sometimes for my wife and me. We are in the best shape of anyone in our immediate families by far and they seem to know it (in the general sense) just because they know the range of salaries our professions make. In general, our families are good about it except for the occasional jab. But it is always awkward like the giant elephant in the room nobody is talking about... In the end it doesn't matter because if our parents need help in retirement, it'll be on us.

Our friends have a much wider range of security ranging from poverty level (by choice) to better than us (it seems). Of course, we aren't flashy so I could be wrong; probably not many of our friends are saving/investing >25% of their gross income.

Nobody knows numbers, but I have mistakenly revealed more than I should have indirectly. For example, whenever there's a bonus at work everyone starts in about a week after it hits with "what did you do with it?" questions. Not thinking, early on I said "nothing" in response. When pressed - "ok, but what are you GOING to do with it"? - I repeated my answer: I'm not going to do anything. It's staying in my savings account.

Oops.

One day I saw the wheels turning in a co-worker's eye (some bonuses are the same for all employees so they know at least some of the amounts). Since then I go with "I spread it all over the place" and leave out the "in various savings vehicles" at the end, or "you know how it is - it was gone before I got it!" again leaving out the "into my Roth IRA" or whatever.

I've also stupidly blurted out "it's best to have six months or so of expenses in the bank" in response to complaints of an unexpected expense. In response I got "but regular people can't possibly save that much!!" followed by that "wheels turning" look in their eye.

Oops again.

I've gotten a lot better though. Haven't outed myself like that in quite some time. I've also managed to keep the fact that I donate anything at all to charity completely secret as far as I know. It's not a giant number - nobody here would be shocked or critical (unless maybe critical as in "that's it?"), but I think the general populace (or worse, the immediate family) would not react well.

Only my wife and I know the details (At least I think she is listening when I tell her). A few family members speculate, because they've seen us grow through careers and know what we own. I don't suspect they truly know how well we are actually doing.

I really enjoy keeping a low profile money wise. I find it makes for a better relationship with neighbors, etc. Most of my friends outside of work are more the blue-collar type. My in-laws own operate a residential framing business. If I drove up in a fancy german car, it would not be taken well. This allows me to live in a social class well below what the misses and I make, but still feel like we are doing just fine. I really don't socialize outside of work with my fancy german car driving co-workers.

I grew up with all types of friends (Farmer's, trust funders, blue & white collar), but I really had the most fun with the Hillbillys. However, I did see how hard they worked for so little, so I chose to pursure a career in the white-collar world. So far it is working well.

I'm pretty sure my parents don't know how we are doing. My mom is always worrying about how we can afford this or that and wants to give us money for things, especially when we visit. I worry about them saving for their retirement!

We have friends how know how we are doing simply because we have been helping them with their finances. Our neighbor knows because she did our taxes this year.

Also, my wife tells her sisters about our finances in order to help them out. She doesn't give specifics but they know we are doing OK since we have helped two of them out over the past couple of years.

I think it is a shame that people don't open up their finances a little more to friends and family. They might be more inclined to model our frugal and saving ways if they knew how we are doing.

Quit eyein' me lucky penny, FMF! :D

Sorry, but yeah, I'm only an imitation krabs. :D

"Is it any wonder this happened? Wasn't she asking for it by telling everyone within earshot?"

Yes and no. Yes, it is weird that this happened...being kidnapped doesn't happen often. No, she wasn't "asking for it"...please don't make me bring up the variety of situations that may have been stupid but NEVER should be considered "asking for it". Unless she actually said "kidnap me", she wasn't asking for it.

As for who I share my financial status with...everyone. Anyone and everyone who wants to know, I'll share. No, I will not randomly start shouting out our net worth in a beauty salon, but if anybody ever starts a conversation about personal finance or investments or whatever, I will chime in with personal experiences when it makes sense.

I enjoy helping people figure out plans that can lead them out of debt and personal stories work the best. I also appreciated talking money with my parents and in-laws since they have actually ended up throwing in some great investment advice or using some of ours with great results. I believe that communication should never be considered stupid.

Not one soul.

Some people used to know (or assume) and I got frequent requests for loans or hand-outs from family. The 2008 financial implosion wiped out my employer. All things considered, I came out ahead; but no one knows it. Since then, everyone assumes I'm getting by paycheck-to-paycheck and the requests for cash have ended. I like it better this way.

Of course my wife knows about everything we have and how to access all of the info whenever she wants. My and her families know that we are comfortable but not any of the details. I have everything in my final papers should anything hapen to the both of us. I want badly to tell my dad because I truly feel he is struggling at the moment. He inherited a house and moved into it but is having trouble selling the house he already owned outright. So he is cash-strapped right now. He retired 25 years ago at 59 without a whole lot of cash then ($150,000 he told me. Yikes!) A couple of small rental properties and SS has kept him going I guess. I keep offering but he keeps saying he is OK. But I do feel that he knows we can provide him money with no problem at all. If he will let down his stupid pride.

The only person who knows the full picture is my SO (and likewise with his).

Anyone who reads my personal blog knows that I'm getting out of debt from college but that I also save for retirement. I'm pretty open in conversation about how much debt I came out of from college, and that I wish I could save more for retirement at the moment (but they don't know the numbers on the latter).

No one besides the SO knows my salary, although some friends know approximate salary. Our families know that we're doing fine, but don't have much of a concept of exactly where we're at. We have had to explain the distinction between "we don't have cable, a/c, [other luxury]" because we CHOOSE not to, not because we can't afford it, after they express worry. But on the other hand I try to share some things (just not exact numbers) because my family needs a little nudging toward dropping some of those things so that they could - novel idea - not live paycheck to paycheck.

PDubbs - I find myself in a similar situation, in that I am the only one that really knows. I wish I could discuss more with the wife. I shouldn't say that my wife has no interest, but she definitly does not want to be involved in any of the details or any decisions money related. Although I don't think this is the ideal situation, it is something that I have come to accept in order to keep the harmony in the relationship.

Even though no one knows (or should know) what my exact net worth is, some still believe that I have money. As such, I've also gotten solicitations to "invest" their business ideas, or at least get a quick loan or favor that amounts to money.

I don't like that. So, that's another reason why I don't tell anyone. I'll basically talk about everything else related to money, but the exact numbers to my net worth is something I keep to myself.

My spouse's mom (who is very discrete) knows our hourly rate. My father knows that our house is paid off. As independent consultants, my spouse and I sometimes go long periods with no work. When we recently took a long hiatus from work for several years to travel, there was a lot of head-scratching and wondering how we were going to live with no income. Now that we are back in the working world, a friend asked if we were "okay" financially. I think he thought we had spent all our money and gone deep into debt (we have no debt of any kind). I'm sure people talk about us behind closed doors and think we are making stupid decisions by not working for a salary/benefits/9-5 workweek, etc. like everyone else. If they could see our bank statements they would realize we are doing well above average, but that's not information we are willing to share with anyone.

Meant to type "discreet".

@DCS - when saying "nothing, its going to stay in my savings account" was that interpreted as it was higher or lower than what they received? I guess I wouldn't have been able to infer anything from that.

As to the whole extent only my husband and I know. Oh - and our financial adviser person. In the past I was able to infer from what other people said that I made less (with experience) than someone who was just hired with no experience. I've moved jobs a few times since, but at my current job I've been able to infer that I make more than people who have similar jobs as me. Because of these two experiences I've always been very careful not to share, or even imply, what I make.

My husband is aware of our 5 and 7 year plan, but probably ignorant of some of the details that go into it.

I know that sometimes I give off the impression that I'm not doing as well as I am. I recently bought a new car, and was talking about cars with a couple of coworkers. I went for an inexpensive model, and made some offhand that in 10 years maybe I'll go for an midrange or expensive car. My coworker laughed at what I considered an "expensive" car. I just let it slide rather than explain that a) I was paying cash, not financing, and b) I have a husband and a kid (he is a 25 & single). When I buy my next car, my mortgage will be paid off, and maybe I'll splurge (but more likely I wont) - but he will still be paying down on the mortgage that he got before me.

Until last week, it was just me. Now my husband knows the complete picture as well. It took me a long time to get him interested. We don't mind sharing it with our parents, but just it never happened.

Before I got married a couple of my friends knew about my salary and general idea about my spending. Now that it is "our" money, I have completely stopped talking about money. So no one know if we are doing alright or bad. My husband thinks it is none of their business and I respect that.

No, the kidnap victim was not "asking for it".


I generally don't talk about my finances with friends or family. We don't compare bank accounts and I don't go around telling people about my emergency fund. Money issues eventually pop into general talk though. Like if a friend has work done on their house I might ask them how much it cost and they might mention they got a loan to pay for it. I have a good paying job and we do have rental properties and some people might infer that we're doing well because of that.

My wife and I do share some specifics about our finances with our parents but they are the main exception. I also do talk on the net about money but I do that anonymously and I don't tell friends or family that I do so.

i am definitely not the type of person that will go around asking or telling people about my finances. but, certain close family members as well as close friends know if im in a tough financial situation or not. as for the actual amount of savings or what type of investments i have etc., thats no one business unless i want to fill someone in to ask them for advice.
Preferred Financial Services

My wife and I both know the full details of our accounts.

We've had friends who needed financial advice, so we shared some numberless details with them (ideas like having an emergency fund, tracking spending and cutting back in areas where it's too high, etc.)

When my kid(s) are older, I plan to let them know in general terms. They don't need to know that my investment portfolio has $X in it, but it's reasonable for them to know that if we had to live off of it, it would cover Y years of expenses, and that it was built simply by keeping our spending low and saving a large amount.

I don't share my financial info with anyone except with my professional financial advisor. Oh, and I guess my divorce lawyer got a look at it a few years ago!

My brother asked everyone in the family for $ several years ago, but it was for such an ill-advised investment that it was easy to just refuse based on the investment being such an awful idea. I'd be happy to help out my Dad if he needs it, but so far he hasn't. I'd avoid lending to my siblings because they're all highly educated and employable.

But I'm considering sharing my financial information with my boyfriend--we've been dating over a year and are getting more serious, and mainly I'm so curious to hear about his financial situation! I can guess his salary (high), but he lives very modestly. On the other hand he's not at all cheap when we go out. On yet another hand, I know he pays alimony and he also supported 4 kids through college. Any advice about when it is appropriate to begin sharing this kind of information when dating?

MC --

You asked:

"Any advice about when it is appropriate to begin sharing this kind of information when dating?"

How about me posting it as a "Help the Reader" question? I can't get it posted until into September, but I think it would generate some good discussion.

I don't tell a whole lot of people outside the wife. A few people I work with who are engineers (generally practical people) and I know they are doing well enough also. It's not a contest kind of thing (like it would be if I were to talk to my neighbors, which I don't) but it's more of a bounce ideas around about what to do with it kind of a thing. I don't share with co-workers who I know live paycheck-to-paycheck. I let my mom know I'm doing all right (no specifics) just so she won't worry unnecessarily. My friends and siblings I will not share with because I really can't tell their situations.

I actually don't like the secretiveness. I wish we could be more open about money, just like I am with the select co-workers I've mentioned. Mostly because I like to get lots of opinions about what to do. But I recognize that it is generally unwise to share with a lot of people. It's going to be tough this fall when I pay off my mortgage not to tell people because it's such a huge thing for me and was a goal of mine to do before 40 (I'm 37)--but I'll probably pretty much keep it to myself.

Sure, that would be fine--go ahead.

I know all the finances of my brother and Parents since I work in a family business and do the payroll. LOL! (Neither my mom or SIL work). However, they have no clue specifically about my financial situation since my husband has a pretty good job and is not connected to the business. We all live in the same town so they know we are doing well, they just don't know the specifics. If they asked, I would probably tell them but they have never asked.

We try and not share anything with my husbands family because they all live in very low cost of living areas and they just don't understand. I still remember being furious with my husband for telling my MIL how much we paid for our house because where she lives it would be a mansion on a lot of land. Instead, we have .21 acres with at 1700 sq ft house!

MC --

It will run earlier than I thought -- Aug 24. Should be fun!

Looks are often deceiving when it comes to net worth, huh? I love that your kids are clueless about wealth/riches. You are doing something right. Though it sounds like you have one of the same challenges we do. How do you educate kids about the difference between those that are big consumers (and to kids seem rich) and those that have a high net worth (and don't appear to be rich)?

My husband and I don't share specifics about our wealth with anyone. My parents know that we're doing fine, as are they. My MIL doesn't understand how we can afford to pay for certain things for her when her other children do not. Most of the in-laws are big spenders, while one family is pretty much miserly.

I think you are doing your kids a disservice by not letting them know how you manage your money. They don't need to know exact figures, but believing you earn "below average" amounts because you spend below average amounts many translate to them later when they are earning "above average" amounts that they can spend above average amounts. I think talking about the choices you are making would serve them better. "We clip coupons at the grocery store, so we can help pay for your college", "We don't buy X, because I'm saving for Y".

You must be doing an excellent job of living a very frugal life..., for your kids to think that!

Hmmm, I have to wonder if your kids know that you are the blogger of freemoneyfinance.com. If so, they must not read it...

The comments from your kids gave me a good chuckle :)

I have a bit of a different problem (related to this topic). For the past 15 years, I have worked in the area of M&A and licensing. About 4 years ago, I joined a privately held company that, at that time, had a market value of approximately $850 million. The CEO brought me on board to help grow the company in a more aggressive fashion through transactions. As such, I led several acquisitions that more than doubled the revenue and increased the profitability by 4x. This made the company highly attractive to other larger companies and, as such, the company was bought out for a HUGE price (cannot mention actual price due to confidentiality).

As this company was privately held, only family members had any measurable holdings. Employees, such as myself, had "token" shares in an ESBP, but it was pocket change. Various investment bankers (wealth departments) assume that I, as well as others on the management team) walked away with huge paydays. Neighbors and relatives assume the same thing as well. Most guess that I must have walked away with at least $10 million. Unfortunately, that is not the case. I still need to go to work everyday doing my same job, but for the new owners. The new owners expect that I will continue my track record and have given me some okay incentive programs, but not the big bucks.

Even though I did not get a big pay day, I still save aggressively and should have enough by 55 to focus on volunteer work.

There is also a silver lining to all of this. With my track record, I have many different employment options should things not go so well with the current company. Further, I have been approached by many investment groups to do my own start-up with my own management team. I am giving this option a bit of consideration, but will probably wait for about three years before I do so as I want to get my oldest 2 kids through college first.

This is a great topic, and i really enjoyed reading everyone's answers. The one about your kids comments in the car is priceless, as will be the eventual epiphany when they realize what a great job Dad has done for them.
I tell no one other than my wife any details about our finances, and even then, she is quite disinterested in the details at that. As long as she knows that we are not in any imminent danger of losing the house, she is content to leave the boring minutia of personal finances to me, her own live -in personal finance geek.
I for one would sooner talk about the intimacies of our sex life than reveal anything about our personal finances to anyone else. I'm quite content to be one of those millionaire next doors types who drives an 11 year old car and shops at the dollar store and fly well under the radar, not just for security reasons,but also because i think it impolite to boast about net worth. Its possible to discuss conceptual things like asset allocation and living under ones means with close friends, and I'll happily share my favorite reading lists, but including specifics of my own finances into the discussion would just be distracting and potentially counter productive, I think.

OK, Aug24 then! I look forward to varied advice on my situation... :)

I have kept the practice of telling the wife, maybe a few details to my own parents, and that's it. I just think that this is the type of information that can bring out some unusual behavior in people, whether they have more or less money. When you factor in the danger factor, as the story indicates, it makes more sense to be careful. Once can have a very enlightening, detailed conversation about personal finance, including investments, without being too detailed.

My hubby and I don't share our details with our family. I have a close, trusted friend who I'm comfortable talking details with. We've been friends over 15 years. Otherwise I don't get into specifics.

I too like how your kid's don't think you're doing that well. Nevertheless, I am also a bit concerned that they think it's wrong, and that they don't realize it's a choice.

Nobody knows of my financial situation (I'm single), even though I discuss being frugal, most family/friends still express concern for the same reasons others mentioned - I don't have a new/expensive car, I don't have cable, etc. My parents - I've mentioned a few things, but I get the impression they don't really believe it (they make about 5x what I do, yet I'm saving just as much, possibly more). I find that old lingo dies hard, so I find myself oftentimes saying - I can't afford XXX, or I'm broke. In reality, it's not that I can't afford something or I'm broke, it means that I don't want to spend money on something or that my splurge fund is low (it doesn't bother me, just an observation). The only people who suspect my assets are a couple of close friends whom run a local non-profit that I both donate to and work for (2nd job) - I'm around them enough that they've pieced together that a frugal nature, talk of retirement investing, and great vacations are something I don't just talk about, and that the donations I make are "extra" money despite being some of the larger donations they receive regularly.

Eh. For me there's nothing to brag about. My wages are poverty level, and I don't mind mentioning it. It's not like they're gonna want to rob me...I have very little worth taking. :P

KT --

They don't know YET. At this point, they're not old/mature enough to understand the detailed aspects of managing money, so they don't get everything. But they do get age-appropriate teaching, of course.


I don't care who knows. If Presidents can be assassinated then anyone can be "got to" if they really want to harm or rob you. And it doesn't take a genius to be able to ball park how much someone is worth and looking at their lifestyle will tell you if they are living beneath their means (aka got a big nest egg VS paycheck to paycheck). Most job salaries can be estimated with salary related websites. I don't like the secrecy about talking about money and finances.

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