Rich friend, poor friend

Illustration by Kendra Yee

Money. Some days, it seems simple enough. We trade our time and skills for it, then trade it for things to eat and a place to sleep. But other days? Money can get really, really weird. Take our friend J, for example, who forgets their wallet when out with K. K foots the bill, enthusiastically too, until three months later when the debt’s still unpaid, but K feels too uncomfortable to bring it up. Suddenly what began as fifteen dollars balloons in significance, a dime here to represent the fact that J’s new job pays him more than K’s does, a quarter there becomes a symbol of the fact J’s even looking at condos.

The point is that financial matters between friends can get awkward fast, especially in our 20s and 30s when a formerly egalitarian peer group may see its members begin to earn higher salaries for the first time, but not necessarily at the same rate. We'd all like to think that money could never get in the way of our personal relationships—it's just money, after all—but life is rarely that simple. Take B and C for example, former university roommates. While B just got a big promotion, C’s entry-level job barely covers expenses. If B wants to celebrate their milestone birthday at a hot new wine bar, is C really expected to pay $21 on a glass of rosé?

Here are some guidelines to navigate this rocky terrain, no matter what side of the divide your paycheque falls on.

“All my friends make more money than me and I feel like a loser”

1. Know that your worth isn’t determined by how much you make—and this goes both ways. 

Think about it rationally. Maybe you’re still in school or you’ve chosen a career path you’re passionate about, but that comes at the expense of a zero or two on your paycheque. This means that you have nothing to be ashamed of if you can’t afford that new tapas restaurant your corporate lawyer friend keeps raving about, but it also means they’re not a jerk just because they can.

2. Be open about what you can and can’t afford. 

Sometimes, this type of honesty starts with ourselves. Creating and sticking to a monthly budget means that we’re in the know about our finances. A few tweaks here and there might even give us more room for special outings with friends than we thought. When we know exactly what we’re spending, we’re more likely to know when certain activities are out of reach, rather than simply assuming we can’t afford what our friends can out of habit. But when these off-limits situations do arise, be firm about setting boundaries rather than going with the flow and resenting it later. 

3. Try connecting with friends through free or low-cost activities. 

If you’re starting to feel like you can’t keep up, get pro-active and suggest activities that fit into any budget. Hang out in the park or host a movie or board game night. Chances are your friends don’t want to be breaking the bank all the time, either. It’s also worth remembering that unless someone has discussed the state of their financial health with you directly, you might not know as much as you think. Take O, for example, who just got that big promotion at work but is still drowning under massive credit card debt. Or M, who may have declined going to that concert with you because they’ve taken on financial responsibility for a struggling family member. 

“I make more money than my friends and I feel like a jerk.”

1. Know your audience. 

It’s okay to be proud of your recent promotion or a new higher-paying job. Celebrating our ability to provide for ourselves doesn’t make us shallow or materialistic, but a friend who’s struggling to pay their cell phone bill right now might not be the best person to share that enthusiasm with. Your friend is probably happy for your hard-earned success but err on the side of sensitivity when it comes to flaunting its material aspects.

2. Don’t fake it if you’ve made it. 

At the same time, walking on eggshells or cosplaying as a poorer version of yourself is an approach that’s most likely to come off as condescending. After all, you’ve worked hard to get where you are, and chances are you had your fair share of instant ramen along the way.

3. Try connecting with friends through free or low-cost activities. 

If you know a friend is strapped for cash, suggest a free activity like going on a hike, visiting a local swimming hole, watching a sports game, or just old-fashioned hanging out (remember that?). It also goes a long way for both parties to express genuine interest in each other’s work. Knowing that you and your friends value each other’s labour regardless of the paycheque attached to it demonstrates a level of respect that’s integral to any healthy friendship. 

See? Despite their income disparity, your rich friend and your poor friend still have enough in common that the same advice applies to both of them. Money doesn’t have to—and shouldn’t—be the centre of our interactions, especially with those we’re closest to. But signing onto that idea in theory is a lot different than actually shaking our hard-wired doubts: Should I be working harder? Am I phony and everyone knows it? Do I need new clothes?

Remaining confident in our self-worth regardless of our income is, for many, a lifelong project. It requires patience, acceptance and, since our financial circumstances are likely to fluctuate, flexibility.  One thing that’s likely to stay the same? Money’s weird. But guess what, your friends, both rich and poor, are probably weird too. That’s why you get along so well.

We can help.

It’s not about how much you make. Or even how much you save. Whether you’re spending, saving, investing, borrowing, or paying off debt, the key is to do it with purpose. A financial planner can help you create a plan that puts you first. 

Book a 30-minute financial planning meeting now

May 17, 2023