Overcoming Financial Infidelity
Making sure money doesn’t get in the middle of your relationship.
Maintaining a happy home isn’t always easy –especially when it comes to money and financial issues that can have a serious impact on every in the household. Fights over money are a leading cause of family conflict and even divorce, so it’s important to get on the same page financially…and to make sure you stay that way with consistent and honest communication.
The information below can help you understand how to overcome some of the most common types of financial infidelity that couples face. If you’re facing challenges with debt –whether it’s together or as a couple –we can help. Call Consolidated Credit today at or complete an online application to request a free, confidential debt evaluation with a certified credit counselor.
What is financial infidelity?
Financial infidelity is what happens when one partner in a relationship is less than honest about their finances with the other person. This can happen when you hide accounts or credit card charges you make, take out hidden assets in your own name, or attempt to keep important financial issues from your partner.
This kind of dishonesty doubly risky to the strength and stability of your relationship, because not only do you have to deal with the lack of honesty between partners, you also have to deal with any financial fallout that may come from what was being hidden. Debt and budget problems on top of dishonesty in your relationship just adds to the stress and feelings of betrayal.
Financial infidelity statistics
Unfortunately, financial infidelity is a common problem in the U.S. and it’s a real threat that couples face which can create significant rifts that ruin relationships.
According to an infographic published in 2012 on Forbes:
- 1 in 3 people admit to keeping money secrets in their relationship because they disagree with their partner
- 32% of women have hidden purchases, while 17% admit to the same
- 1 in 4 women also lied and said a purchase is an old item when it was actually something purchased recently
Another article in the Huffington Post in 2012 found one in five people are keeping a “major”financial secret in their relationship. The Huffington Post also had an article in 2014 that found that 35 percent of Americans have been financially deceived by their partner.
Facing Infidelity: Secret Purchases & Transactions
By and large, the most common type of financial infidelity comes when one partner hides a purchase or a series of purchases from the other partner. You find something you like when you’re out and about, you know it’s out of budget, so you pull out the plastic and put the purchase on credit so you can satisfy your need to buy.
Of course, the impact of this type of financial infidelity depends on the size of the purchase and history of repeat offenses. If you only do it once and the purchase is something under $100, then it’s not that big of a deal financially. On the other hand, if one partner is spending a few hundred dollars extra month after month, then it can become a big problem.
Really though, the problem is the act keeping purchases from your partner and doing so even once can set a dangerous precedent. If you get away with it once, you’re more likely to do it again, and it can become a dangerous habit.
If you’re making secret purchases: Bite the bullet and confess! It’s better to tell your partner yourself than have them find out later when a bill comes in. Tell your partner what you bought, how much you spent and why you felt like you had to hide the purchase. It may come to light that you’re both feeling hedged in by your budget and you need to set aside money each month so each of your can splurge a little.
If you find secret transactions: Take the evidence you find to your partner as calmly as possible. Ask what happened and if there are any other purchases that you don’t know about. Again, focus on WHY your partner felt the need to make those purchases behind your back. Sometimes the issue may be resolved with budget adjustments, or it may just be about getting honest when you make purchases instead of keeping them secret. Avoid getting angry or making accusations.
Facing Infidelity: Hidden accounts
A few secret transactions is one thing, but finding an entire account that was hidden is a slightly bigger problem. In most cases, this happens when one partner opens a credit card without the other partner’s knowledge. Instead of just hiding a single purchase amidst the month’s transactions, you open a secret credit card so you can charge regularly without your partner’s knowledge.
The problem? Well, in most cases, this bill isn’t going to be included in your budget. So you’re placing stress on your finances because the cost isn’t factored into your budget. As a result, you’re more likely to make low minimum payments, which means you end up paying more for your purchases in added interest.
And while you may be able to hide the account for a time, it’s not likely you can hide it forever. For instance, let’s say you and your partner decide to buy a home. When your lender calculates your debt-to-income ratio they are going to include that hidden account, which may impact your ability to qualify for the mortgage at the terms you want.
If you have a hidden account: First, stop making charges. Step two needs to be to confess to your partner that the account exists. Your knee-jerk reaction may be to hide it and try to eliminate the debt on your own, but it’s a much better prospect to confess and come up with a plan to eliminate the debt incurred as quickly as possible.
If you find a hidden account: It’s going to be hard to keep you temper when you find out your partner has been keeping an account secret, but the calmer you can stay, the less likely this is to break up your relationship. Stick to the facts –how much debt is there to deal with together and what kinds of transactions were being made. You may need to adjust your budget to make your partner feel less cornered. For example, if you see your wife is putting clothing purchases for the kids on the secret credit card, consider adjusting your budget to provide for affordable monthly clothing purchases so your partner doesn’t feel the need to make those purchases in secret.
Facing infidelity: Squirreling away assets
The final most common type of financial infidelity comes when one partner is squirreling away money or assets from the other. This usually happens for one of two reasons:
- The “saver”in the relationship feels like they have to hide money in order to keep it from being spent.
- The person hiding money is preparing for separation.
In the first case, it’s not a good sign for the relationship that you have to keep secret accounts in order to keep your partner from spending every dime, but it’s also not the end of the world. In this case, you both need to get on the same page when it comes to saving and spending.
Your budget needs to have a set amount that you save together and that money shouldn’t be spent. Real limits need to be set for spending so each of you knows exactly how much you’re supposed to spend each month. And if your partner really does have a hard time not spending, consider saving and asset options that can’t be tapped, such as investing in bonds where you put the money away and can’t touch it for a set amount of time.
Hiding assets in preparation for a divorce is an entirely different matter. If you’re trying to hide assets ahead of a legal separation, keep in mind that it’s against the law to hide assets during a divorce filing. In most cases, even if you plan on leaving soon, hiding assets is not a good idea. Unless you have a specific reason, such as putting away money to flee from domestic abuse, you should never try to hide assets.