Understanding Financial Infidelity in Relationships

Updated: March 18, 2024

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Financial infidelity occurs when one partner in a relationship is not fully honest about financial dealings. This can include hiding or lying about personal debt, secretly making large purchases or maintaining hidden accounts. It’s a common yet highly damaging scenario in which the consequences can be severe, eroding trust and causing significant strain in the relationship.

According to a poll from the National Endowment for Financial Education, two in five Americans admit to financial infidelity against their partners. Eighty-five percent of those individuals stated that it affected their current or past relationships. Understanding the profound impact of financial secrets on relationships underscores the importance of honesty and open communication about money matters between partners.

What Is Financial Infidelity?

Financial infidelity is the deliberate concealment or misrepresentation of money matters by one partner. Unlike general financial irresponsibility, such as impulsive buying or poor money management skills, financial infidelity is characterized by deliberate deceit. The core issue lies not in the poor financial choices but in the secretive behaviors that lead to breaches of trust.

The causes of financial infidelity can be complex, often rooted in individual fears, beliefs and the dynamics of the relationship's economic management. Some individuals may conceal financial information out of fear of judgment, loss of autonomy or to avoid conflict, while others might do so as part of more complex issues, such as hidden affairs or planning for a potential exit from the relationship.

Common examples of financial infidelity often involve:

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    Hidden Accounts

    Keeping secret bank or credit accounts without the partner's awareness may affect joint financial planning or savings goals.

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    Undisclosed Debt

    This is failing to divulge that significant debts have been accumulated, potentially impacting the couple's financial health and ability to make future financial decisions together.

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    Secret Spending Habits

    Spending considerable money secretly or on undisclosed items could undermine trust and financial security.

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    Hidden Income

    Not disclosing parts of one's income, like bonuses or raises, to avoid sharing or discussing how it should be used or saved.

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    Secret Investments

    Making investment decisions or purchasing stocks, real estate or other significant assets without the partner's knowledge or consent.

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    Gambling Losses

    Hiding losses from gambling activities can rapidly deplete shared or individual finances without the partner's knowledge.

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    Financial Gifts to Others

    Secretly giving money to friends or family members can substantially affect the couple's financial stability.

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    Hidden Purchases

    Keeping certain purchases, like expensive gadgets, jewelry or even a vehicle, completely hidden from the partner.

How to Recognize the Signs of Financial Infidelity

Unmasking the truth behind financial infidelity often begins with recognizing subtle patterns and symptoms. This might start with secrecy, a defensive stance when money matters surface or unexplained shifts in purchasing behaviors. Recognizing signs of financial infidelity can help address and overcome it in a relationship. Address these signs with open and honest communication. Here are some indicators that might suggest financial dishonesty:

Unexpected Financial Documents

Receiving mail or emails about unknown accounts or debts can be a clear sign. This could include bank statements, credit card bills or loan notices for accounts you weren't aware of.

Overprotectiveness of Personal Devices

A partner who suddenly becomes very secretive about their phone or computer, particularly around financial apps or websites, may be hiding something.

Unexplained Expenses

Noticeable cash withdrawals or charges from joint accounts that cannot be accounted for or are brushed off when questioned can indicate hidden spending.

Changes in Credit Scores

A significant, unexplained drop in one or both partners' credit scores might suggest hidden debts or financial activities impacting your joint financial health.

Reluctance to Discuss Finances

Avoiding conversations about money, future planning or becoming defensive when the topic is brought up can be a red flag.

Discrepancies in Income and Spending

If there seems to be more money being spent than what should be available based on known income sources, this might indicate undisclosed earnings or debts.

Missing Money or Assets

Discovering that funds from savings or the sudden disappearance of valuable items without a plausible explanation could indicate secret spending or selling off assets.

Secretive Behavior or Lies About Spending

Finding out that your partner lied about a purchase or frequently hid their spending habits is a direct sign of financial infidelity.

Effects of Financial Infidelity on Relationships

Financial infidelity not only strains the financial dynamics of a partnership but also deeply impacts the emotional and psychological well-being of those involved. Partners involved in situations of financial infidelity may experience one or more of the following common effects:

Dissolution of the Relationship

Unveiling financial secrets can lead to a profound erosion of trust, a cornerstone of any relationship.

Emotional and Psychological Stress

The revelation of financial infidelity can significantly elevate stress and anxiety levels, contributing to mental and emotional strain for both partners.

Increased Tension and Disagreements

Such breaches of trust often precipitate increased instances of conflict as partners feel betrayed and seek to understand the reasons behind the deceit.

Financial Uncertainty

The discovery of hidden debts or expenditures can destabilize a couple's financial situation, challenging shared goals and complicating efforts to achieve financial security.

Impediments to Future Planning

The trust issues arising from financial infidelity can cast doubt on joint financial planning and aspirations, affecting everything from homeownership ambitions to retirement planning.

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Because financial infidelity is a significant emotional and economic form of abuse, it’s recommended to seek support from professionals who specialize in financial counseling and relationship therapy. Organizations like the National Foundation for Credit Counseling (NFCC) and the American Association for Marriage and Family Therapy (AAMFT) are equipped to offer help in these situations.

Healthy Financial Habits to Cultivate for Strong Relationships

Practicing healthy money habits in a relationship involves creating a culture of openness and transparency in handling finances together. Establishing clear communication, setting shared financial goals, and respecting individual financial autonomy can help build a resilient financial partnership. Here are several approaches to ensure both partners feel secure and informed about their shared and individual finances:

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    Establish Open Communication

    Commit to having regular, honest discussions about finances. Schedule monthly financial meetings to review your budget, savings goals and any financial concerns. These conversations should be judgment-free zones where both partners can share their feelings, concerns and goals. Open lines of communication help prevent misunderstandings and secrecy.

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    Regular Financial Check-ins

    Besides your monthly meetings, have periodic check-ins about your financial status and progress towards goals. These can be quick touchpoints to ensure you're both on track and any concerns are addressed promptly.

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    Create Joint Financial Goals

    Work together to set shared financial objectives. Whether saving for a home, planning for retirement or setting a vacation fund, having common goals can encourage teamwork and financial fidelity.

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    Maintain Individual Financial Freedom

    While having shared goals and accounts is essential, allowing for some degree of financial independence can reduce the temptation to hide spending. Agree on an amount or percentage of income each partner can spend freely, no questions asked.

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    Set Financial Boundaries and Expectations

    Clearly define acceptable and unacceptable behavior regarding money. This includes handling personal spending, joint expenses and future financial decisions.

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    Use Budgeting Tools

    Employ budgeting apps or software both partners can access. This transparency in spending and saving helps build trust and keeps both partners informed about their financial health.

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    Educate Yourselves Together

    A lack of financial knowledge can lead to poor decisions and secrecy. Take time to learn about personal finance together through online courses, books or workshops. Understanding economic principles enables both partners to participate equally in financial decisions, enhancing mutual respect and transparency.

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    Celebrate Milestones

    Recognize and celebrate progress towards your financial goals. This positive reinforcement can strengthen your relationship and build momentum for continued improvement.

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    Seek Professional Advice

    If managing finances together is challenging, consider consulting a financial advisor specializing in financial issues. Professional guidance can help navigate financial planning and communication barriers.

Additional Resources

For couples looking to strengthen their financial relationship, here are several organizations and resources that can provide support, education and counseling:

  • Association for Financial Counseling & Planning Education (AFCPE): Offers resources and support for individuals and couples looking to improve their financial well-being. Their certified financial counselors and educators specialize in budgeting, saving, debt management and financial planning.
  • Couples Institute: Specializing in relationship counseling, the Couples Institute offers guidance on how couples can communicate more effectively about money. They provide strategies for discussing finances, setting shared goals and making financial decisions together.
  • Financial Therapy Association (FTA): For couples seeking a more in-depth approach to resolving financial conflicts and improving their relationship with money, the FTA provides resources and a directory of financial therapists. Financial therapy combines financial planning with emotional support to help couples understand the root of their financial behaviors and how to improve them.
  • National Foundation for Credit Counseling (NFCC): Offers a wide range of financial counseling services, including debt counseling, financial education, bankruptcy counseling and housing counseling. Their certified counselors can work with couples to develop a comprehensive financial plan and address their financial challenges.
  • Smart About Money (SAM): A program of the National Endowment for Financial Education, SAM offers free courses, tools and resources to help couples manage their finances more effectively. Topics include budgeting, debt reduction, planning for the future and other aspects of financial well-being.

About Nathan Paulus

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Nathan Paulus is the Head of Content Marketing at MoneyGeek, with nearly 10 years of experience researching and creating content related to personal finance and financial literacy.

Paulus has a bachelor's degree in English from the University of St. Thomas, Houston. He enjoys helping people from all walks of life build stronger financial foundations.