At an Impasse but Finding a New Path

“I can’t believe you see it that way!”

Just last week, I said this to my wife in the middle of a discussion (O.K., a fight) about money. We were experiencing something many of you have probably also faced. We needed to make a very important financial decision about how much of an emergency fund we wanted to maintain before we built a house, and we were both locked into our way of seeing it. I saw it my way and wanted more of a safety net. She saw it her way and needed much less of a backstop. Neither of us thought the other person was making any sense. We were at an impasse.

The fight dragged on for a couple of days, and then led to a discussion with some friends. As a result of these discussions, we started to believe that there might be a third way.

The third way will make a lot more sense if we first understand why we end up in “my way” versus “your way” arguments. It comes from being human and struggling with confirmation bias. Most of us make a decision and then after we have already decided, we do the research. What’s more, the research we do consists of gathering data that agrees with our position and summarily dismissing anything counter to it.

Once the “research” is done, we’re often stuck. We’ve put a stake in the ground and said, “This is my way.” At that point, it’s really hard to back down because now we have ego wrapped up in our decision. Being open to someone else’s way or even a third, alternative way means being open to change, and change can be painful. It also means that we have to be open to the possibility that we might actually be wrong, and that’s really hard for us to do.

A true third-way solution is not the same as a negotiated solution. Negotiation involves meeting in the middle. Each party gives a little (or a lot) and no one ends up entirely happy with the outcome. Negotiating solutions to money problems is often necessary, but it’s not a third-way solution.

Negotiated solutions are about in between; third-way solutions are about better. A third way is an alternative that we hadn’t thought of before, that both parties are thrilled with. Nobody feels like they gave in. Instead, there’s shared excitement.

Like many good things, finding a third-way solution is simple, but not easy. It requires a conversation, often a series of them, which have one very important ground rule: We have to listen to each other. This isn’t your fake, “Yeah, I’m listening.” It’s real, intense listening.

My friend, Scott Kelly, who is a wellness coach in Park City, Utah, describes it as listening with intense curiosity. We need to be interested in really understanding the other person. Before anything can change, before we can let go of the ground we’re defending, we need to understand the other person’s view completely.

Your goal should be to enter their world and see it through their eyes. Start by asking questions, like, “Help me understand why you see things that way,” and “I want to understand your way because I love you/I trust you/I respect you.” Whatever questions you ask, make sure they aren’t just an attempt to cross-examine the other person enough so that they give up and come to your conclusion. Both parties have to play by the rules. Ask a question to understand, and then listen with intense curiosity.

Real understanding only happens if you can listen without judging. We need to remember Stephen Covey’s warning that “most people do not listen with the intent to understand; they listen with the intent to reply.” It’s really hard to listen (and understand) if we’re mentally busy crafting a rebuttal.

Maybe this discussion happens right after an argument. Maybe you need to take a break. But when you decide to re-engage, both parties need to do it with respect. Only then will you be able to look past the territory you’ve staked out to see a possible third way.

I’ve seen this work with everyone from children to business partners. And it worked with my wife and me too. As we listened to one another, we realized that I was having trouble even conceptualizing the amount of money that would give me the security I craved, given the problems we had the last time we owned a home. So instead, we focused on structuring savings in a way that it at least stood a decent chance of feeling like “enough.”

So it was a guess. But my wife did helpfully reminded me that someone with my name just wrote a book that made the case for taking a guess when setting financial goals.

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The opinions expressed by featured authors are their own and may not accurately reflect those of the BAM ALLIANCE. This article is for general information only and is not intended to serve as specific financial, accounting or tax advice.

© 2015, The BAM ALLIANCE

Carl Richards, CFP®

Carl Richards is the creator of the weekly Sketch Guy column in The New York Times and is a columnist for Morningstar Advisor. Carl has also been featured in The Wall Street Journal, Financial Planning, Marketplace Money, The Leonard Lopate Show, Oprah.com and Forbes.com. His simple but meaningful sketches served as the foundation for his first book, "The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money."

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