What Happens to Friendships When Money Gets in the Way?

What happens to a friendship when money differences show up? / Illustration by Kaitlin Brito

Some years back, a good friend of mine, whom I’ll call Margot, made the decision with her husband to send their two children to a private school in the city. For a number of reasons, this was not a choice they arrived at easily or eagerly, most especially because the cost of tuition worked out to be roughly equivalent to buying a new C-Class Mercedes every year. Fully loaded.

That they could afford such a big nut puts her in an elite financial class, she understands, though she’d have me note that this expense came with some degree of sacrifice in other areas of their life: scaled-back trips, no new cars, less spending in general. In the beginning, Margot assumed that the same was true for the other parents at the school — at least the ones she was hanging out with over coffees and dinners and playdates. After all, she says, the expense was a constant topic of conversation in the early days, when it was still a new line item for most of them. Something to bond over, even.

Until, suddenly, it wasn’t.

It’s not that she begrudged all of these families who were still managing, tuition notwithstanding, to drive up to school in actual new Mercedes and plan their winter breaks in Aspen or Mayakoba (or both). It’s just that when you believe yourself to be in the same financial boat as your pals, it can be a bit jarring to realize that they’re cruising along in a different one. A bigger one, with more bells and whistles. Their own private yacht, even.

Then came the school fundraiser … and the tickets for the school fundraiser, which were $250 apiece.

“In my mind, we’re already paying a huge amount a year for tuition,” Margot says. “I didn’t want to spend $500 on a night at the school for mediocre food and drinks, plus another $200 on a babysitter and an Uber.” So they opted out. “We felt like if we’re going to spend that kind of money, it should be for something we’re psyched about. And if we’re going to give it away, I’d rather give to CHOP.”

Meanwhile, the friend group was buzzing: “Are you going?” “Oh, you’re not?” “Why aren’t you going?” She didn’t know how to explain to them that you are either someone for whom $700 is a negligible, non-impactful expense, or you are not. Instead, she caved. She got the tickets, the sitter, the car. And then, upon arrival, she found still more buzzing: “Have you seen the silent auction yet?” “What are you going to bid on?”

“Everyone was so excited to spend money in this auction,” Margot says. “But I was like, ‘I have to spend another $300 on a signed Donovan McNabb jersey? Jesus Christ!’”

And that, she says, was that. The end of the affair, so to speak. Her break from the group involved no drama, no awkward conversations, no tears. It was simply a slow drifting apart that seemed to Margot inevitable, unmoored as she was by that unsettling sense of divergence. Disparity. And just … difference.

Money can do that to friendships.

Statistically speaking, you have the most friends you’ll ever have at age 25; after that, it drops off. Anecdotally speaking, here’s what often happens in the next couple of decades: Those friends, with whom you more or less have parity (it’s a documented fact that we’re mostly friends with people in similar-ish economic brackets), start to get ahead in their jobs after a decade-plus of putting in the work. You do too. But “getting ahead” means one thing if you’re a teacher or customer service rep or journalist, and an entirely different (read: richer) thing if you’re a corporate lawyer or cardiologist or investment banker.

Meanwhile, a decent number of friends are also getting married or divorced or remarried, with net worths bumping up and down (or quadrupling, if they marry a cardiologist). With increasing regularity, too, grandparents and favorite aunts and parents begin to shuffle off this mortal coil, turning some friends into heirs of real estate or new piles of cash. And then you wake up one day to find that the people you’ve gone to the Poconos with every winter for 15 years are squeezing that trip between jaunts to Park City and Paraguay. Or maybe you’re the one doing the squeezing. Not that you’re keeping score, in either case.

Or maybe you are. A little.

“I know it’s dumb,” admits a Fairmount neighbor who works in development for a major cultural institution. “I feel happy with my career, my house, my life. But when I see friends who pretty much live like we do, and they’re going on three or four vacations a year — big vacations, faraway places — it does sometimes make me feel, like, ‘Oh, wait, what am I doing wrong?’”

Vacations are one thing, offers a different friend in Bella Vista, but what she finds herself clocking more often is the less obvious (though not less expensive) spending in her social circle — kids playing in multiple travel soccer leagues at $1,500 a pop, for example, and those who attend $15,000 summer sleep-away camps on top of those big family vacations. It’s also all her 40-something friends with supple, well-rested faces thanks to regularly refreshed Botox, or the one pal who casually brings $200 worth of top-shelf booze as a hostess gift.

I know what you’re thinking right now, but this isn’t a story about keeping up with the Joneses. Not really. Because tensions come from the more moneyed side of things too. And again: I know. Cry ’em a river, right? But pity isn’t the point. The point is that things can sometimes get weird for just about everyone when it comes to money and friends. Consider the couple I know, worth millions, who downplay the grandiosity of their incredibly grandiose new home, lest they seem braggadocious to their pals in normal-size places.­ And the acquaintance who admits to me that he wishes his friends would loosen the purse strings and live it up more when they go out or — for God’s sake — at least let him pay when he offers. Or the Bucks County mom I talked to who tells me she still worries, many months after the fact, that she alienated another mom-friend by remarking how she wouldn’t survive winter without the heated leather steering wheel and remote-start feature in her luxury-class SUV. (Her friend: “Yeah, my Honda Civic doesn’t have that.”)

Her worries might not be totally unfounded: In a poll put out last year by financial services company Bread Financial, 26 percent of respondents said they felt “financially incompatible” with their friends. And almost as many — 21 percent! — reported actually losing friendships. I read this and thought it sounded improbably high — way overblown. But then again, for the dozen or so stories I heard of friendship weathering little blips of financial discomfort and disparity, there was also Margot’s story of dissolution. And the one from a colleague who lent money to a friend only to be ghosted and, he harrumphs, never repaid. And the friend of a friend who came into money, moved to a million-dollar manse, became obsessed with talking about home values (hers, yours, everyone’s), and has been deemed borderline insufferable by her old-time girl group.

I really love them. I just cannot afford them. Every time someone in the group says, ‘Hey, I’ve got a great idea!’ my heart is in my throat.”

None of this is surprising to Anna Goldfarb, a Philly-based friendship expert and author of Modern Friendship: How to Nurture Our Most Valued Connections. “Money can create friction in a friendship because how we spend is a reflection of values,” she says. “And one of the biggest reasons friends break up is a mismatch in values. The issue here, more succinctly, is ‘Do we value money in the same way? Is there a mismatch here?’” This gets at what loads of people said to me over the course of reporting this story: It’s not necessarily how much one friend or another might have that stresses people out, but how they spend it, and on what.

Not only that, Goldfarb says, but how we interact with our friends has changed over the years in a way that allows for more opportunities to see and feel these mismatches. “Friendships used to be based on more of a ‘favor culture,’ Goldfarb says — borrowing sugar, grabbing rides to the airport, watching children. “It was ‘What can we do for each other?’”

But this has changed, she says, as we’ve outsourced more and more of our favors. (When was the last time you drove a pal to the airport?) Today’s adult friendships tend to be more entertainment-focused, more “What can we do with each other?” This is also true, she adds, because in middle age — as opposed to, say, our 20s — the time we have to spend with friends is at a premium. The days of hanging constantly and doing nothing together are mostly gone. “That dynamic just doesn’t translate as adults quite as much,” Goldfarb says. Instead? You meet for lunch, you meet for dinner, for drinks, for coffee, for shows, for shopping. All of which reveals those money values (where you eat and how you order, what you buy and what you don’t, what you do for fun and how you split — or don’t — the bill) that you might have otherwise never noticed or known about your friends.

Oh, and don’t forget the parties, Goldfarb says. Seems like everyone she knows is constantly going all out for birthdays these days, having 10 or 15 or 20 people out for a big dinner. “There’s a whole birthday-party culture,” she says — another relatively new phenomenon. “Your grandparents did not do this for their 47th birthdays,” she says. “They had a little cake at home. That was the expectation. I’m fascinated how we treat birthdays now like this multiday holiday we all have to celebrate.”

This immediately calls to mind my dear friend Michael. Michael is a born-and-bred Northeast Philly boy who made good as a writer, moved out to Los Angeles, and immediately made friends with a group of guys who have also made good. Really, really good. Into-the-stratosphere good.

In 2023, Michael turned 60 and planned a long weekend with some of these friends in Palm Springs. Like Goldfarb, Michael finds it striking that landmark birthdays automatically translate to a trip, he says: “I don’t know who started it, but it’s definitely a thing.” Not one to disappoint an audience, he went for it and rented a swanky house, covering half the cost himself and asking his friends to chip in the rest — something like $500 a person. “We drove out, we cooked and went out a few times, and that was that. It was lovely.”

Not long after that, the next birthday and next trip rolled out. “But this one was ‘Oh, we’re going to Costa Rica for a week,’” Michael says. “And flying business class. And staying in this ridiculous villa.” The host covered the villa, he says, but the flights — three airplanes each way — and the meals and the zip-lining were on his own dime. Michael supposes he could have abandoned the group to fly coach, he says. Instead, though, “I just ate canned tuna for two months prior so I could afford it.”

Two months later, there was the next birthday and another trip — Puerto Vallarta. Again for a week. Again business class. This time, the room was on him. He went anyway. After all, “I love these guys,” Michael says. “I really love them. I just cannot afford them. Every time someone in the group says, ‘Hey, I’ve got a great idea!’ my heart is in my throat.”

Sure, every so often, he might mention something to them about watching costs, Michael says. “But of course I don’t want to feel like the poor relation,” he says — or be the guy who cringes at the prospect of a night (or seven) out. “Because then they’ll feel like they need to downsize for you,” he says. “‘Oh, it’s fine, we’ll just get hoagies from Wawa.’”

Now, Michael says, there’s another trip coming up — Puerto Vallarta again. This one isn’t for a birthday: a handful of these friends make an annual pilgrimage there. He’s not going. “They’ve been doing this together for 20 years,” he says, “so they don’t invite me to that one.” In the beginning of the friendship, he admits, “I felt a little left out.” But now? “I’m ecstatic,” Michael says. “It saves me the embarrassment of saying, ‘Look, I’ve gotta draw the line somewhere.’”

I’ve never gone on a vacation or a blowout birthday trip with Margot, but if we did, I like to imagine we’d get along as we always do, values essentially aligned as they are. (Isn’t that part of the lesson I took from her private-school friend story? She’s more like me than she is like them.) Though it’s hard to say for sure, given that Margot is essentially one of them. A rich person, I mean. Our values might align but our budgets might not, is what I’m saying.

Does Margot actually think of herself thusly? As a rich person? Truthfully, I have no idea. We’ve never talked about it. Which really tells you something, considering that the main shared value of our two-decade friendship is talking. This is what we do, almost exclusively, and we have talked about all manner of personal things: therapy sessions, other friends, problems with kids and spouses and parents, problems with hair, problems with precancerous moles, plastic surgery, things that come out of your body in childbirth, and so forth. But never money. At least, not our own money. When she moved into a (giant) new house a few years back, I didn’t ask my longtime friend how in God’s name they paid for that. I didn’t even ask her what she paid. I just Zillow-stalked the address like a normal person. As I assume she did when I moved into my house.

This cloud of mystery is not unique to us, of course. Personal finances are so widely understood to be a taboo topic among friends that even on Real Housewives (a TV franchise in which money itself is a character, plot points hinge on the stampeding of every conceivable social norm, and wine is regularly hurled into faces), a recent insult lobbed from one Beverly Hills cast member to another about a comparatively lesser fortune was deemed by appalled co-stars as having gone way too far.

It’s strange to think in an era when Americans can’t even agree that the Earth is round or Nazism is bad that this is the thing people of all ages and tax brackets still rally around, the one rule that has held. NO MONEY TALK. But there you have it.

“It’s true,” Goldfarb says. “As a culture, we don’t have a lot of models for how to talk about money with our friends.” You wouldn’t want to sound rude, or judgy, or too rich, or too poor, or greedy, or naive. And so you zip it. Which is likely why 65 percent of the people who responded to the Bread Financial poll said they’d broken their budgets going out with friends rather than bringing those budgets up in conversation. This is also why so many of us labor under illusions and make suppositions about people whom we believe we know well. (As Michael says, in certain moneyed circles, “I think there’s a casual assumption that I can hang because I can dress the part and I know what a shrimp fork is,” he says. “But inside, I’m a kid from the Northeast who likes a good cheesesteak.”) This is why advice columns are packed with grown people begging a stranger for any guidance on how to navigate money issues in their social circles. (You know: “Help, my friends are richer!” “Help, my friends are poorer!” “Help, my friends are freeloaders!” “Help, my friends are Zillow-stalking me!”)

Goldfarb’s advice, if you’re looking for it, reflects what most of these advice columnists end up writing: Maybe go ahead and talk, if not about the details of your bank account, then definitely about the details of the friendship, and then maybe about money’s role in the friendship. “One of the most important things I learned writing my book is that every friendship needs an about — and the about needs to be clear and compelling to both people.” This is where money can come in, she says. “‘Is our friendship about going out for dinners?’ ‘Is our friendship about living the high life, sharing vacations we like?’ If your friendship isn’t about those things, but it’s about connecting on values around your families or your work, well, then this other stuff you might be willing to negotiate on.”

Believe it or not, I know someone who actually did this with her friends, and who would tell you it was one of the more transformative moments she’s experienced in her social life. Jen is a Fairmount-based entrepreneur and consultant; she and five girlfriends took a trip to Cape May a few years back. They were sitting around chatting about life when one of the women announced that she was just so fucking stressed about money all the time. The causes of her stress aren’t important; what you need to know is that this led to a conversation about various other money stresses in the group, which led to Jen, who had recently finished paying off upward of $100K of debt, sharing this fact with her friends, as well as the budget-tracking app she relied on to help her. Suddenly, they all had their phones out, downloading the app, entering their numbers and comparing everything — their salaries, partners’ salaries, daycare costs, household expenses, specific money stressors, all out there in the open. Social norms, modesty — all forgotten. (In fact, she likens this experience to being at her favorite day spa, where everyone walks around without a stitch of clothing. “Feels weird at first,” she says. “But after five minutes, it’s totally normal.”)

Actually, she corrects herself, this was better than normal. “I know it sounds cheesy,” she says, “but I loved it. It was one of the most incredible friend experiences I’ve had in my life.” Goldfarb couldn’t have scripted it better: After the group budgeting was done, Jen says, the group talked about what they all really wanted from the time they spent together. (Answer: conversation, alcohol, space to be together.) This actually changed their activities henceforth — fewer concerts and pricey dinners, more game nights and pizza hangs. Jen swears they are closer for it. Interestingly, the money bit — who made what, who spent what, the vulnerable and nitty-gritty bit of truth-telling that opened all this up — was beside the point, in the end.

This makes me think about something Goldfarb says when it comes to friendship and money, which is that parity isn’t always economic, and what we have and what we give and what we spend isn’t really a numbers game. I also think about Margot, and how she might retire on a yacht and I in a yurt, and it just doesn’t much matter, because our “about” is yapping each other’s ears off, and that’s free. Also, just look at this world, at the current political climate, at an impending AI takeover. It feels entirely plausible that whatever financial capital I have — whatever capital you have — could be gone tomorrow, vanished forever into some digital or political void. Increasingly it strikes me that the clear and compelling connections we make and have with the people we choose to love are the only truly solid things we have left to bank on. And you really can’t put a price on that.

Published as “For Richer, For Poorer” in the May 2025 issue of Philadelphia magazine.