This article, in which I was interviewed, recently appeared in Millie; financial content for women, money, investing, and spending. The article in its entirety appears below as it was published at https://www.synchronybank.com/blog/millie/financial-affairs/:
By Stacy Morrison
- PUBLISHED JULY 20, 2020
- 9 MINUTE READ
Lauren* was pretty annoyed when she walked through the door and the purebred chocolate Lab bounded toward her and started barking. One, she didn’t particularly like dogs. Two, she soon learned that the dog was actually her dog. Hers and her husband’s, that is—a shocking revelation considering Lauren had specifically told her husband just a few weeks before that she did not want a dog. It’s a huge financial burden, she told him, and a major time commitment. They had a toddler, Lauren was in law school and she was working full-time.
Lauren came to love the dog and life moved on for the two of them. She earned her law degree. They had another baby. They established good, solid careers.
But the dog wasn’t the only financial surprise. A few years later, he did the same thing with a boat. “He just went out and bought it without any discussion and hid it from me for a long time,” Lauren says. “I mean, how do you hide a boat?” (Answer: Buy it with hidden funds and moor it at a friend’s slip.) And, guess what? He did it with a car, too.
“I think I normalized it,” she says now. “I just thought, ‘Oh well, you know, couples fight about money.’” But eventually, her husband’s lies led to real cracks in the foundation of trust between them and Lauren started socking away some of her own secret money—all of which ultimately played a part in ending their 30-year marriage.
It’s temptingly easy to brush off the occasional secret spending as “just one of those things.” But the reality is that any kind of hidden behavior around a couple’s finances is a financial infidelity.
“Financial infidelity generally involves some kind of secrecy or deception,” says Stefanie O’Connell Rodriguez, a personal finance expert and coach. “Like any other form of infidelity, it’s an action that violates the rules, expectations and boundaries of a relationship.”
And it’s extremely common. A 2018 national Harris Poll fielded on behalf of the National Endowment for Financial Education showed that 41% of Americans have committed an act of financial deception in their relationship, whether it was hiding purchases or cash (the two most common behaviors), or lying about debt.
He Hid the Unpaid Bills in the Trunk
Isabelle* realized her husband was hiding something when she discovered more than six months of unpaid bills—bills her husband was supposed to be paying—in a tote bag shoved in the trunk of her nanny’s car. “It was buried beneath beach chairs, buckets and wet towels,” Isabelle says. “When I grabbed the bag, all the mail spilled out—I’m talking like hundreds of letters, cards, bills and statements, most of them damp and covered in sand.”
That’s when the little things that had been happening for months began to click: The time her AmEx was declined for a work lunch and the way the Schwab account balance didn’t look right when she checked it in her money management app. “I never questioned him, because I never questioned our marriage,” Isabelle says.
Six months or so before this realization, she had asked her husband to take over managing the monthly bills. They had been married for 15 years and she was in the middle of starting a new business while also mothering a baby and a 4-year-old. “I was the bookkeeper in our marriage. But I was also working around the clock trying to build a company and was doing about 90% of the childcare and the household stuff,” says Isabelle. “So I finally said to my husband, ‘Hey, can you just pay the bills? They’re all in Chase Bill Pay. It’s all in order.’ And he said yes, of course he would take care of it.”
But he didn’t.
Isabelle found out that the AmEx hadn’t been paid, that stocks she owned had been margined (money had been withdrawn against their value) and that utility bills had been paid in dribs and drabs, just enough to keep them from being turned off.
“He still couldn’t admit it and had no explanation,” Isabelle says. “I chased him around the house in tears and we had one of those arguments that lasts until 2 a.m.” The truth didn’t come out until an emergency therapy appointment a day or so later, which Isabelle had arranged. There, he finally confessed: He hadn’t paid the bills because he felt overwhelmed and didn’t want to ask Isabelle for help. So instead he lost track, let it all collect and grow and snowball.
“He couldn’t ask me for help because he felt emasculated. And he blamed me for emasculating him,” says Isabelle, the disbelief still clear in her voice 15 years later. “I loved my husband but I had to deal with the consequences. I knew I could never trust this man again.” She ended the marriage and was too ashamed to tell even a single friend why.
Talking About Money Isn’t Sexy, But It’s Necessary
While their tales are very different, what Isabelle and Lauren’s stories have in common is a failure to communicate. And, tragically, this is true for many American couples. People find it difficult to talk about money, especially because it’s so entwined with deep-seated emotional issues like commitment, trust and control
“People enter a marriage with expectations about their financial lives,” says Anne Malec, a clinical psychologist and financial, marriage and family therapist based in Chicago. “But those expectations often aren’t articulated.” A recent Harris Poll conducted for SunTrust Bank showed that just over half of couples (51%) discussed how they would handle finances before getting married—and even fewer disclosed their annual salaries (41%) or debt (36%). “People don’t like talking about money because it’s not romantic; it’s not sexy,” adds Malec. “But it is the nuts and bolts of what keeps your relationship strong.”
Another reason people don’t talk about money is because it’s perceived as “taboo,” even more so than talking about sex. Or because they grew up in households where there was a lot of conflict around money and now they prefer to avoid the topic altogether. Money is a point of stress for 60% of adults in America, according to the American Psychological Association, which has been tracking this topic for more than a decade.
“What’s really tricky about defining financial infidelity,” says financial expert O’Connell Rodriguez, “is that most couples don’t take the time to define the rules.” And if you don’t have rules, then how do you know if you’re breaking them?
Malec says that financial infidelity is an issue that comes up with more than half of her clients seeking financial therapy. And she agrees that an essential lack of fluency—as individuals, not just as couples—is often at play. “As a society, we don’t do a very good job of teaching people about money. Some parents never talked about money in front of their kids, and then those kids became adults who don’t know anything about mortgages or credit cards,” she says. “Or some parents maybe didn’t necessarily model how to have a healthy, functional relationship with money.”
Lauren—the woman whose husband secretly bought a boat—agrees that this was a factor in her marriage. “We got married young and never had those money discussions,” she says. “Neither of us had good role models either: My husband’s dad went bankrupt a couple of times and both of my parents were constantly hiding purchases from each other.”
Debra Kaplan, a licensed therapist and author of For Love and Money: Exploring Sexual & Financial Betrayal in Relationships, says not having good financial role models—and then not talking about money—is typical. Couples need to have money conversations. Without them, there are assumptions—about work, the importance of savings and how much each person spends—that begin to pull at the fabric of the relationship. And when unspoken expectations aren’t met, resentment seeps in. “Resentment is a major driver of some of these financial infidelities,” says Malec. Typical reasons she hears from her clients include: “She was trying to control my spending.” “He would always say no.” “He has made huge purchases without consulting me, and now it’s my turn.” And “She refused to talk to me about a budget.”
When Financial Fights Seem Unavoidable
Ashley* knows a little bit about resentment. She and her husband had a pretty easy financial relationship at first: They both had good jobs, they were both saving and they split the bills. But then their son was born—who had special needs and required a lot of extra care—and then Ashley lost her job. So her husband opened up a small joint account and put her on a strict budget, which she thought was untenable. Ashley soon became overwhelmed and felt underappreciated.
Once when they were at a fancy wedding in the Berkshires, Ashley remembers, she saw a beautiful necklace in a display case in the hotel’s jewelry store. “I began lusting after it,” she says. “My husband and I were already in a bad place at this point—he had started being mean and distant—and he was treating me poorly on what should have been a romantic getaway.”
She kept circling back to look at it and finally decided that she had to have it. It cost $1,200. “I felt neglected, financially restrained and belittled,” Ashley says. “So I decided that I deserved that necklace for putting up with him. It was a secret little ‘f- you,’ because he was so extremely frugal.” She still has the necklace, and still loves it, but the marriage ultimately didn’t make it.
“Financial stress and frequent financial disagreements contribute to reduced relationship satisfaction,” says Sonya Britt-Lutter, a researcher from Kansas State University who has studied couples and financial infidelity. In her study, in which she surveyed 4,500 couples, money came up as the No. 1 reason for fights in a marriage, and money fights are one of the biggest predictors of divorce.
And it’s more than a little ironic that many people’s reactions to stress is to … spend! A study from the Journal of Consumer Psychology found that shopping is a legitimate coping mechanism: People who are sad or stressed or scared feel like they have no control over their lives—and shopping is an exercise in autonomy. You see, you want, you buy. And that instant gratification feels good, at least for a little while.
That’s why the field of financial therapy, which specializes in getting to the root of clients’ money habits, is growing. It’s about finding the “emotional choke point,” Kaplan says, “that underlying fear or belief that dictates how a person handles money.”
Don’t Just Hand Over the Royal Crown
If both partners aren’t involved in financial planning for the family, what you end up with is “financial abdication.” Sounds fancy, like you’re handing over the royal crown—and in some ways you are—but what it basically means is that one person checks out completely and gives the financial reins to their partner.
Despite the fact that so much has changed for women—25% of married women are the primary breadwinner in their family and only 27% of mothers don’t work outside the home—gendered expectations are still a powerful force in setting the financial dynamic. A recent study showed that 56% of women leave all the long-term financial planning to their partners. And even though an Experian study showed that the majority of both men and women (94%) think “financial responsibility” is an important attribute in a partner, only 2 in 5 believe the responsibility for household finances should be shared.
“You can’t just outsource your financial responsibility to your partner,” says Malec. And doing so just because your partner likes to be in control or has more experience “can create a dynamic in couples that is very parental,” she adds. “Don’t create a situation where your partner will have to say no and be the bad guy. Or worse, they say yes when you really can’t afford it.”
Even if your partner is the “bookkeeper,” the way that Isabelle was, stay involved. O’Connell Rodriguez, Malec, Kaplan and pretty much every other financial advisor/therapist/expert out there recommends having monthly meetings where both spouses map out their goals, review their accounts and see if any adjustments need to be made.
And right now, with the great disruption and uncertainty that COVID-19 has brought into everyone’s lives, is the perfect time to create new habits.
“I think financial infidelities and mistakes can be corrected,” says O’Connell Rodriguez. “What’s a deal-breaker is someone who’s not willing to engage in the conversation. Your financial plan is not something you set up and put into cruise control. Money is a practice. It’s not something you do once and then you’re done. And these last few months are a great example of how your financial plans can totally shift from day to day.”
Those financial shifts can shift a relationship, too. After all the money secrets came to light and Isabelle realized her marriage wasn’t salvageable, she told her nanny—the one whose car was used as an accessory to the infidelity—that she and her husband were getting divorced. “She was shocked,” says Isabelle, “Anyone who knew him would tell you how wonderful and loyal he was. But I told my nanny, ‘A year doesn’t promise you another year. Ten years doesn’t promise you another 10 years. Marriage is day by day. And financial infidelity is like an underground root system that spreads and poisons over time—even if on the surface everything appears normal.”
*Pseudonyms were used at the request of these sources.
Millie content is licensed from Meredith Corporation, publisher of Millie, Real Simple, InStyle and more.
Stacy Morrison is a writer, editor and content consultant and founder of Koi Beads.
Illustration: Nathalie Lees