How financial infidelity can erode trust and ruin your finances
In 2016 David *, a British expatriate living in the United Arab Emirates, decided to buy his wife a car for her birthday and used his credit card to make the 40,000 dirham down payment. However, he lost his job and after 10 months found that he could not keep up with the monthly car loan or credit card payments.
Rather than talking to his wife about his financial problem, he began borrowing from friends to make ends meet in a desperate effort to meet his financial debts. Finally, he stopped repaying his debts.
“For my wife, I gave the impression that it was not a struggle and that everything was fine. I didn’t want her to feel like she had to give up the car if I had trouble meeting the payment, ”says David. The National.
We have heard stories of people taking on debt to finance their lifestyle – which would be hard for them to admit, even to partners.
Stuart Ritchie, Director of Heritage Consulting, AES
David, a senior sales consultant, kept his finances a secret from his wife for about two years. However, he had no choice but to show clarity when he was prevented from boarding a flight at the airport because the bank had issued a travel ban against him for them. overdue payments. His wife interrogated him and he was forced to confess.
“I didn’t break her financial confidence, she was just hurt that she chose to keep my finances a secret,” David says. “My wife was upset because I thought she was superficial enough to worry about keeping the car instead of solving my problem. financial situation.”
Financial infidelity, which includes hiding purchases, having a secret bank and credit card account, or taking out a loan without your spouse knowing, can have a devastating effect on a marriage and create problems. trust between couples if one of them is not honest about it. money.
Because of the easy access to debt and credit, it’s easier and faster for financial problems to get out of hand, according to financial experts.
“We’ve heard stories of people taking debt on mountains to finance their lifestyle – which would be hard for them to admit, even to partners,” says Stuart Ritchie, director of wealth counseling at AES. “I have heard of couples who have faced problems in their marriage due to a lack of financial disclosure.”
Spending more on what a partner might consider frivolous items, such as clothes, cafes, and paying for taxis rather than taking public transport, are minor examples of financial infidelity, says Carol Glynn, founder of Conscious Finance Coaching.
“Other examples of financial infidelity are bank accounts that only one partner knows about. These accounts are used for expenses that they don’t want their partner to know about, ”says Glynn. The National.
In 2020, a survey conducted by creditcards.com found that financial infidelity in marriages is on the rise, with 44% of U.S. respondents admitting to having kept financial secrets from their spouses.
Jamia *, an Indian communications professional in the United Arab Emirates, has loaned people money without her husband’s consent. In total, Jamia’s friends and acquaintances owe him around 20,000 dirhams.
“My husband thinks that not everyone has a real need. He asks me to classify and lend money only to those who need it most. I don’t quite agree with him, and that’s why I didn’t disclose this information, ”she said. The National.
Jamia admits that she has been lending money since she started earning a salary. She has been married for 13 years and has since kept her loans a secret from her husband.
“Whether it’s a family emergency or a job loss, I’ve always been there to help in any way I can. While many have returned the money, some have not, ”she adds.
Although Jamia’s husband knows she is lending money, he doesn’t know the exact amount. She says she would not want to divulge this information to him under any circumstances.
There are many factors that can be at play when it comes to financial infidelity among couples, according to financial experts.
There is a lot of shame in making bad financial decisions, which leads people to hide their problems
Carol Glynn, Founder, Conscious Finance Coaching
“Poor communication leading to misunderstandings about finance between couples is one, deliberate and intentional deception is another, but I find the most common driver to be miscommunication combined with shame and fear.” , says Mrs. Glynn.
“There is a lot of shame in making bad financial decisions and it leads people to hide their problems, not asking for help and that includes not telling their partners about it and not wanting to admit that they are. made mistakes. They try in vain to fix the situation themselves or worse, bury their heads in the sand, but the situation gets out of hand.
Another survey conducted by creditcards.com in January 2021 found that 38% of those surveyed had committed or been victims of financial infidelity in the past year due to the impact of the Covid-19 pandemic. Of those who have experienced financial infidelity, almost two-thirds say they have suffered financial stress due to job loss or declining income in the past year.
About 28% of those who have committed financial deceptions say they have made secret purchases, 20% have hidden debts or accounts, 19% have drained money from savings, 18% have loaned money without mutual consent and over 16% lied about their income. , the investigation found.
Meanwhile, 29% of those surveyed say they withheld financial information from their partner to avoid an argument, 21% wanted to feel more in control of their finances, 20% were embarrassed by their money management skills , 17% did. to help someone else and 13% didn’t want to share bad news, according to the survey.
In older generations, it is common for the male counterpart to take on all financial responsibilities and for the woman to have a secret savings account, the purpose of which is to serve as an emergency fund or to purchase things that the husband wouldn’t approve, Mrs. Glynn said. . It could also be seen as a form of financial infidelity.
This lack of communication has allowed financial indiscretions to go undetected for years, often only after the death of a spouse, Glynn adds.
“Like other forms of infidelity, society places a great deal of shame and blame, often on both the perpetrator and the victim. It is very common for both partners to be too ashamed to talk about what they are going through with their friends and family. It can be a very lonely experience, ”says Ms. Glynn.
Meanwhile, the likelihood of committing financial infidelity may also depend on age, according to a February survey by creditcards.com. Millennials are more likely to commit some form of financial infidelity with their partner than Gen Xers and baby boomers, he found.
“Among many younger couples, a partner [usually the male] takes care of everything and the other partner [usually female] be close, if not totally, oblivious to the details of their financial situation. This allows financial infidelity to happen and continue undetected very easily, ”says Ms. Glynn.
Couples need to have more open and honest conversations with each other – and as early as possible, according to Ritchie. Talk about your income and responsibilities so the relationship can be built on a foundation of trust and responsibility, he says.
“Too often we avoid telling the truth for fear of someone else’s reaction. But, who knows, your partner may surprise you and help you pay off your debt, ”he adds.
It is important for couples to talk about their financial state of mind, their aspirations, their feelings about debt and early investment in the relationship because “what a person may think of as habits or unacceptable financial behavior may be normal for the other, ”adds Ms. Glynn.
Financial experts recommend that both partners get involved in family finances. Spouses should be careful not to sign financial forms such as tax returns or loan applications without fully reading and understanding them.
“I have seen women sign loans that they thought were in both their names, but they were in fact only in the woman’s name, which means that she is solely responsible for the debt. Or approve tax returns that are deliberately fraudulent, ”Glynn warns.
Couples should also set aside at least an hour per month to review and discuss family finances. Both spouses must have their own access to all bank, investment and loan accounts. That way, they can independently review family finances at any time, making it much more difficult for any partner to hide issues, she adds.
For someone who resorts to financial deception, Mr. Ritchie recommends that they be honest and confess to their partner as soon as possible, or involve a third party such as a friend, family member or even a financial planner to help alleviate or manage the situation.
“Once exposed, there is no point in hiding. Admit your mistakes and allow yourself to be vulnerable. Tell your partner the reasons for your financial indiscretion, ”says Ritchie.
“Try to have a calm, rational conversation, discuss how to solve the problem and move forward rather than focusing too much on what has already been done. You cannot control the fact that debt exists. But you can control how you manage it from now on. “
* Names have been changed for confidentiality reasons