How to stay friends when salaries differ


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Rich friend, poor friend?

Back in college we were all on the same page: poor students pooling cash to buy pizza and beer. Sure, our families may have come from different income brackets, but the more fortunate would often spread their wealth because it was always more fun if everyone was drinking, right?

But in adulthood, that income gap puts a strain on relationships. That one episode of “Friends” says it all: Rachel, a waitress; Phoebe, a masseuse; and Joey, an actor, complain because they can’t keep up with their more wealthy friends (Ross, Chandler and Monica) who give pricey gifts and prefer eating out at pricey restaurants.

This wealth divide can push friends apart. Over time, “You tend to hang out with people who make roughly the same amount of money that you do,” which makes it hard for some friendships to survive, says Ryan Howell, associate professor of psychology at San Francisco State University and co-founder of Beyond the Purchase, which studies the psychological link between money and happiness.

But just because you can’t afford to join your best friend at her favorite Michelin-starred restaurant doesn’t mean your friendship is dead. There are ways to navigate this tricky territory of staying true to your financial values while staying true to your friends.

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Accept the income gap
Accept the income gap © Minerva Studio/

This is the cold, hard truth of adulthood: Your salary might not match that of your friends, and it will make it more difficult to spend time together.

For Christine Huck, a visual artist, the social dynamics with her college friends changed dramatically after graduation. In college, “We’d eat together in the cafeteria. We would go dancing,” says Huck. But as graduates, her friends took corporate jobs while she struggled to find work in the creative field. Social outings “turned into going out (and) drinking.” This kind of spending added up. At one happy hour, she brought a peach because she couldn’t afford to nibble on the appetizers her friends were sharing. “I just felt awkward and a little bit like an outsider for not participating and eating food,” she says.

“The reality is not everyone will earn the same amount of money. Not everyone will live in the same type of house. What I encourage people to do is focus on the friendship and not the finances,” says Dallas-based financial adviser Derrick Kinney.

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Resist peer pressure
Resist peer pressure © ARENA Creative/

Peer pressure doesn’t end after high school. If anything, once you start making money, there may be more pressure to dress a certain way, live in fashionable neighborhoods or indulge in pricey vacations with your peer group. Especially among young adults making a decent salary, “There’s pressure within that social group to go out and spend money and look a certain way, whether it’s clothes or style,” says Chris Dlugozima, a certified consumer credit counselor at GreenPath Debt Solutions in New York.

Once Huck found steady work at a framing store, a close colleague cajoled her into hanging out at expensive lounges. They would have fun drinking, eating and dancing, but at the end of the month, “(I’d) look at my bills and be like, ‘I can’t believe I did this!'” Huck says. “We just ate food and had a bunch of drinks. I could have bought new pants and replaced the ones with a hole in it.”

This kind of rude awakening can hurt a friendship. “The relationship hits a bumpy road when one friend puts himself/herself in jeopardy because he overspent or is living beyond a comfort level,” says Kathleen Gurney, Ph.D., CEO of Financial Psychology Corp.

“So many people, if they want to keep up with someone, they will spend money they don’t have to do those types of things that will only get themselves further and further into debt,” Kinney says.

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Remember that your income isn’t your identity
Remember that your income isn't your identity © Pressmaster/

Society may suggest otherwise, but in truth, your income isn’t your identity.

But severing that connection is hard. “Especially in America, money is very much a real symbol of hierarchy and status,” says Howell. Our culture often associates money with morality, which is why people tend to pass judgment on those who make less, says Howell.

“If you’re a person who made a lot of money and your friend didn’t, it puts implicit pressure on a cultural norm that somehow you’re better or they’re worse; you worked harder or they were lazier; you made good decisions, they made bad ones.”

The key to maintaining friendships across the income divide? Banish these judgments. Dissociate your income from your identity.

If you’re the friend with the lower income, “Resist feeling less-than because you earn less,” says Gurney.

Most likely, if your wealthier friend truly cares about you, they’re not thinking about your income. Teri Stern, 49, of Durham, N.C., is financially secure, but many of her friends are teachers on tight budgets.

While the wealth gap is there, it’s not something that affects the way she sees her friends. “It’s not about the money,” she says. “It’s about who you are as a person. I don’t assume that the person with the bigger house is somehow superior.”

This is the right attitude, says Gurney, who advises wealthier friends to “keep money out of the personal dynamics as much as possible.”

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Don’t nurture toxic emotions
Don't nurture toxic emotions © wavebreakmedia/

Making significantly more or less than a close friend will naturally trigger some difficult emotions.

If you earn less, you may feel jealousy, inadequacy or embarrassment. While these emotions are natural, Gurney warns that harboring jealousy can lead to resentment. It’s important to examine the root of these emotions. Often your issue isn’t with your friend; it’s with yourself, says Carole Stovall, a psychologist and executive adviser in Washington D.C.

Jealousy is “a strong signal that we have to re-evaluate the choices that we made,” she says.

By analyzing the source of your jealousy, you may realize that you admire your friend’s choices and decide to make a change in your life. On the flip side, you may realize that the choices you made bring you greater satisfaction, which is worth the financial trade-off.

As the wealthier friend, you may feel guilt or frustration. It’s difficult to share your good news — be it a big raise or the purchase of a new car — without feeling bad. But if you find yourself unable to talk about anything going on in your life without feeling overwhelmed by guilt, then your friendship will certainly suffer. Stovall recommends evaluating the relationship: Is this a true friend or an acquaintance? Because with true friends, you should have the freedom to talk through these complicated emotions and find a common ground.

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Be honest about your financial situation
Be honest about your financial situation © pio3/

The wealth divide can make close friendships awkward, but a lot of these thorny moments can be avoided with a frank conversation.

“When it comes to close friendships, money can either make the relationship or break it,” says Kinney, who advises intimate friends to talk about their financial situations. “It can really help the relationship go deeper.”

Dlugozima says talking it out allows friends to find ways they can cultivate their friendship without breaking the bank.

Close friends are typically “very receptive” to these conversations, says Kinney. “They respect and admire the person who does that.”

However, Dlugozima says, “You may find that person says they only want to hang out spending oodles of money living it up on a Friday night.” If that’s the case, “Then you have to look in the mirror to see how much you want that person in your life.”

When Huck told her colleague that lounge life was eating into her paycheck, they grabbed a cheap beer from the store across the street and brought it back to the frame shop where they enjoyed a nice conversation. Once Huck started avoiding these expensive lounges, “I ended up saving a lot of money. My checking account was growing!”

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Don’t make assumptions
Don't make assumptions © Rido/

So many factors play into one’s financial health. A highly paid doctor may be digging her way out of mountains of debt. A modestly compensated teacher may be sitting on a nice cushion of savings accumulated over the years.

“Don’t just assume that because the person has a lower-paying job that they’re struggling financially,” says Dlugozima. These assumptions may come off as condescending, especially when coming from a friend with a higher income. Sure, it’s a good, sensitive move for wealthier friends to suggest more affordable activities, but propose an array of options, says Dlugozima. “Instead of saying, ‘Hey, I know you’re broke,’ say ‘Hey, I was thinking of doing a potluck dinner or going out.'” By suggesting a few different social options, you give your friend the ability to splurge if he wants to or decide to go with the more affordable option.

If you’re the friend who makes less money, don’t assume that you’re disappointing your highly paid friend by suggesting a picnic instead of an expensive night on the town. Sometimes, this comes as a relief to the person making more money, who also wants to reign in spending but, because of her high income, feels pressure to keep up a certain lifestyle, Kinney says.

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Find affordable common-ground activities
Find affordable common-ground activities © wavebreakmedia/

Gurney advises friends to “participate in activities that can be achieved easily by both parties.”

Stern loves attending musicals and typically tries to get the best seats available. But when she goes with her teacher friends, she happily buys less-expensive tickets. “For me, it’s more about the experience of going with a friend than having the best seat in the house,” she says.

Gurney says the friend making less has to pull equal weight in expressing their priorities. “The lower earner has to feel confidence that the relationship will survive if he or she is honest as to what is affordable and what is not,” Gurney says.

When Huck’s college friend suggested they celebrate New Year’s Eve at the Drake Hotel in Chicago, Huck had a hard time saying no. “I may not ever have an experience like that again.” As hard as it was, she declined.

With her group of friends already going, Huck thought she might spend the holiday alone. But her college friend cared more about spending time with her than at a fancy party. They rang in the New Year together.

Bottom line, Gurney says: “Remember why you are friends, and keep those sentiments in the forefront of how you treat one another.”

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