When you and your partner have all or part of your finances pooled, trust is undoubtedly the foundation of that relationship. You trust each other with the money and the way you, as a team, use your resources to achieve common goals. But if one member of the team secretly throws the match while the other is trying their best to win the game, success is unlikely, and when it is found out, the trust becomes an unfortunate victim.
In this article, we examine the devastating effects of financial infidelity, what causes it, and how you can protect your relationship from it.
We all know that money is one of the top reasons couples fight, so it’s interesting to note that avoiding a fight is one of the top reasons partners commit financial infidelity. Knowing that one partner would reject a purchase or certain behavior (eg, impulse buying), the other partner hides the receipt, rounds off the value of the purchase, or claims the purchase was a gift from a friend. Of course, avoiding conflict is just one of many causes of financial infidelity, and some forms of infidelity (e.g., gambling) are the result of deeper psychological issues that should be addressed by a doctor.
In a CreditCard.com 2021 survey of the prevalence and causes of financial infidelity, 30% of partners who admitted to financial infidelity said they wanted to control their own finances. 25% said the reason they were unfaithful was embarrassment with how they were spending their money, while 13% said they used the money for an addiction.
Financial infidelity can also be a result of different value systems related to money or a partner’s unwillingness to compromise. When one partner earns significantly more than the other, their money-related behavior may appear controlling or restrictive to the lower-earning partner, who may then spend money as a form of rebellion. On the other hand, it can happen that the higher-earning partner is angry about having to bring in the lion’s share and secretly spends money because he feels entitled to do so.
If a partner isn’t fully committed to the relationship or is concerned that the relationship won’t last, they could set up a secret bank account as a safeguard if the relationship ends. When a partner is having a physical affair, they can commit financial infidelity by hiding travel, restaurant, or gift receipts. Whatever the underlying cause of financial infidelity, it points to some kind of breakdown or imbalance in relationships which, if left unaddressed, can lead to a complete relationship breakdown.
Another survey of financial infidelity, conducted by the National Endowment for Financial Education (NEFE) in 2021, found that financial infidelity occurs at all income levels – although wealthier people can afford to use more sophisticated methods of cheating, such as setting up trusts or moving money off-shore. 39% of survey respondents admitted to hiding a purchase receipt, bank account or bill from their partner, while 10% admitted to lying about their earnings. The survey also found that younger couples are more likely to hide money matters from each other than older couples, likely because their relationships are new and have had less time to build trust. Older couples are likely to have more established and better used channels of communication.
Unfortunately, it’s not always easy for an unsuspecting partner to spot financial infidelity in a relationship, especially with the shift to online shopping and e-billing. The likelihood of intercepting an invoice or collection letter in the mail is slim, and hiding online accounts from an affiliate has never been easier. Without a partner’s username, passwords, and access to their email account, it’s difficult to find out if your partner is committing financial infidelity.
However, there are some signs to look out for, such as: B. if your partner has inexplicable or large amounts of cash in their wallet or if there are conspicuously no vouchers or receipts. When it comes to filing tax returns, your partner may be reluctant to provide their payslips or bank statements. or your partner may be reluctant to meet to discuss finances or have a joint financial plan drawn up.
Remember that even suspecting your partner of financial infidelity without hard evidence means there are trust issues in your relationship that need to be worked on. So consider what your suspicions mean for your future relationship, and keep in mind that if either party cheats financially, your relationship is unlikely to come out unscathed.
According to the NEFE survey, 85% of respondents said the financial deception had negatively impacted their relationship. 42% of them said it led to a fight, 32% said it led to less trust in the relationship, while 16% said it led to a divorce.
If you discover that your partner has cheated with shared finances, it will likely take a tremendous amount of hard work to rebuild trust and create new foundations on which to operate financially. This could include steps such as setting up a joint bank account that can be viewed by both parties, sharing online account information and passwords, informing each other regularly of all transactions, and allocating time to process bills, debt, planning, and readjust goals. Ultimately, rebuilding trust requires time and commitment from both partners to work together as a team to achieve financial success.
For couples starting out together, it’s important to clearly set the parameters for your financial relationship so both partners are clear on expectations and ground rules. According to the results of the NEFE survey, 38% of respondents felt that some aspects of their finances should remain private – so if maintaining some aspect of financial privacy is important to you, ideally you should raise this upfront.
Remember that financial infidelity is not always clear cut, especially when the terms and parameters of shared finances have not been clearly communicated and agreed upon. If one partner feels cheated or deceived, the other partner may feel perfectly justified in not telling their spouse about a purchase.
To protect your relationship from financial infidelity or cheating, consider the following:
- Set clear guidelines for how your combined finances work and whether each partner retains an element of privacy related to specific financial areas.
- Circumstances change, so make sure you keep communicating and reviewing the guidelines to ensure they remain appropriate for your relationship. For example, if your partner is fired, you will likely change the terms of your joint financial management to account for his or her loss of income.
- Write down your respective goals to determine which areas are common and which areas are specific to each partner. Try to find common ground so there are common goals to work towards, and then make space for each partner to pursue their personal goals.
- Develop a household budget that allows room for personal spending or spontaneous decisions so you don’t feel constrained or constrained.
- Divide the responsibility for managing household finances evenly so that one partner doesn’t feel isolated and weighed down by the responsibility.
Teams have a greater chance of winning when all team members are open and honest with each other, and when one member doesn’t pull in a different direction.
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