In a successful relationship, honest and open communications with a partner are critical foundations for long-term happiness. The same principles also apply when managing personal finances. Disagreements over spending and money management can lead to breakdowns in marital relationships, an increase in mutual distrust, arguments over money, and potentially divorce. In a recent survey from last year, 11% of respondents admitted they would leave their spouse over financial issues if they believed they were bad with money.¹ Another study suggested that couples who argue weekly over finances were 30% more likely to divorce than their counterparts who only argued a few times every month.² The longer it takes for parties to acknowledge and address the problem, the more likely it will escalate into a bigger conflict down the road.  

“It’s not you… it’s me.” 

Financial infidelity does not carry the same stigma in society as marital infidelity, but it is more prevalent than society cares to acknowledge. A 2018 study of 414 participants indicated that 27% had deceitfully kept a financial secret from their partner.³ The most recent study from insurance marketplace provider Policygenius provides some sobering statistics: 

12% of respondents had a credit card they did not disclose to their significant other. 

12% of respondents had a secret savings account. 

13% respondents had a secret checking account.  

12% also had hid a purchase from their partner within the prior 6 months. 

19% of respondents only tell their spouses before committing to any purchase.⁴ 

This brings up an important question: why are people so reluctant to discuss issues concerning their finances? 

The “Money Talk”  

There is no one single cause for financial infidelity, but to be frank, some people just do not like talking about finances for personal reasons. In households where one partner happens to earn significantly more than the other (e.g. stay-at-home parents), there might be a tendency for the bread winner to think in terms of singularity (“his/her share” of the finances) rather than a joint contribution (“our” money). Problems can ensue when partners stop treating their “better half” as an equal in the relationship.  

Some individuals would bristle at the thought of making a budget or tracking expenses talking about money, finding the encounter as pleasant as running fingernails down a chalkboard. A Harris Poll conducted on behalf of the National Endowment for Federal Education found that 36% of respondents believed that some issues regarding their finances should remain private. On the other hand, 26% had discussed money issues with a loved one previously and were certain their spouses would disapprove.⁵  

Fear of disappointing a loved one can also play a role in financial infidelity. The Harris Poll indicated that 18% of respondents were embarrassed about their financial outlook and were concerned how their significant other would react; 16% would not discuss matters out of anxiety.⁶ From my perspective, a candid discussion is better than having both parties living in denial of their current situation. Although it may be more comforting to hear a loved one say, “I got the bills under control,” it is better to be truthful than hearing an admission three months later that, “I need to take $800 from our bank account to cover the minimum balance on my Visa this month. Oh, and I need to make the payment in 2 days.”⁷    

Let’s also acknowledge that society has played a role in segregating household accounts. Most families rely on two incomes to financially support the household. Compared to prior generations, people are also waiting longer before tying the knot (and managing their financial affairs).⁸ If couples are not discussing financial issues before moving in together, ongoing debt problems can come back to haunt them long after, potentially deferring lifelong goals such as saving for home ownership or retirement. 

Taking Control of Your Affairs 

Some people may be wondering: is there a right way to manage finances? Is it better to maintain joint accounts or keep separate records? Recommendations may vary, but there is no right or wrong way to take control of your financial affairs. It really is a matter of comfort and personal preference. Couples can (and have) successfully maintained their separate financial records just as well as those who jointly manage their assets. As one group of marital attorneys noted, “The key is for couples to discuss their views on money and to decide among themselves how they will make decisions about how the family money will be controlled…As long as the goals and attitudes toward money are shared, the mechanics of fiscal management are less important.”⁹ 

New Year, New You 

With the start of 2020, there is plenty of time to make positive and healthy changes for your personal and financial health! As part of our one hour strategy session, we work with clients to discuss and develop debt and credit strategies, and fashion remedies to provide relief to their ongoing financial challenges. Feel free to schedule an appointment at one of our convenient locations by clicking the link at the top of the screen. 

This is just a basic overview and is not legal advice specific to your situation. If you have questions about your rights when it comes to debt and credit, you should speak with an attorney in your area for legal advice. If you live in California or North Dakota and would like to speak with Jen Lee Law regarding your situation, please schedule an appointment.

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1 Hanna Horvath, “Couples & Money survey: 1 in 5 people think their partner is financially irresponsible” Policygenius. http://www.policygenius.com/blog/couples-money-survey-2019/
2 Preston Ni, “7 Keys to Long-Term Relationship Success” Psychology Today, https://www.psychologytoday.com/us/blog/communication-success/201210/7-keys-long-term-relationship-success
3 Jeanfreau, M., Noguchi, K., Mong, M. D., & Stadthagen, H. (2018). Financial Infidelity in Couple Relationships. Journal of Financial Therapy, 9 (1) 2. https://doi.org/10.4148/1944-9771.1159
4 PRSNewswire https://www.prnewswire.com/news-releases/policygenius-one-in-five-people-think-their-partner-is-bad-with-money-300927244.html
5 Harris Poll, “Celebrate Relationships, But Beware of Financial Infidelity”. Feb. 14, 2018. https://www.nefe.org/press-room/polls/2018/celebrate-relationships-but-beware-of-financial-infideltiy.aspx
6 Id.
7 As always, communications made to an attorney for the express purpose of seeking legal consultation or advice are held in complete confidentiality under attorney-client privileges.
8 Hanna Horvath, “They may share love, but many couples don’t share money.” Policygenius Sep. 24, 2018 https://www.policygenius.com/blog/couples-mange-money/
9 “Making Marriage Last”: A Guide to Preventing Divorce. American Academy of Matrimonial Lawyers.

I often talk about people I meet who have various illnesses and health problems because of the debt and financial stress they are facing. The reason I talk about it is because people often feel isolated and alone, so they hesitate to get advice or find out their options because others will think less of them.

Some of the things I see on a regular basis are depression, insomnia, stomach issues, headaches, and anxiety. I once had someone tell me that she could not remember the last time she slept through the night without waking up in a panic. That kind of stress has a profound effect on your health.

An article in the NY Post this week also talks about this issue. The article has some alarming statistics about consumer debt, which is now over $14 trillion and significantly higher than consumer debt was back in 2008.

The stress also makes people more susceptible to scams and services that are not necessarily the best way to resolve the problem. Make sure you find out all of your options and not just the one the person on the phone is trying to sell you. We talk to people every day who signed up for a service and did not fully understand the long-term consequences, which caused even more stress.

Remember, you are by no means alone in dealing with financial stress. You would be very surprised at the number of people in your everyday life who have the exact same issues and everyone is afraid to talk about it. Your best step is to find out what you can do for your situation and make an informed decision.

This is just a basic overview and is not legal advice specific to your situation. If you have questions about your rights when it comes to debt and credit, you should speak with an attorney in your area for legal advice. If you live in California or North Dakota and would like to speak with Jen Lee Law regarding your situation, please schedule an appointment.