Financial infidelity is when someone lies about or withholds important information about money. This dishonesty can happen within romantic relationships, between roommates or business partners, or within a larger family structure. For the purposes of this article, I’ll be largely focusing on romantic relationships. (If you’d like me to write about financial infidelity within other relationship structures, let me know in the comments!).
A 2016 Harris poll for the National Endowment for Financial Education revealed that 42% of Americans admit to deceiving their spouses financially, up from 33% in 2014.
What Happens When Your Spouse Hides Financial Secrets?
Have you ever wondered if your partner was being totally honest about money? I was shocked to learn that cheating on a spouse with money is very common in today’s marriages. According to a 202023 NerdWallet survey, about 20% of Americans who share their finances with their partner admit to hiding or telling lies about financial information. That’s almost half of all couples!.
Financial infidelity might sound like some fancy term, but it’s actually pretty simple – it’s when partners lie to each other about money matters And just like other forms of cheating, it can totally wreck your relationship
What Exactly Is Financial Infidelity?
Financial infidelity occurs when couples with combined finances lie to each other about money. It’s essentially a betrayal of trust in the financial aspect of your relationship.
In simple terms, it’s when your spouse:
- Hides significant debts in separate accounts
- Makes large purchases without telling you
- Lies about their spending habits
- Secretly withdraws money from joint accounts
- Opens credit cards you don’t know about
- Hides income or bonuses
Knowing how to handle your money on your own is good (I love having my own spending money!), but keeping your money a secret can really hurt your marriage.
Why Is Financial Infidelity So Damaging?
When I first started researching this topic, I was surprised by how destructive financial infidelity can be. Here’s why it hurts so much:
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It breaks trust: money is already one of the main reasons people get divorced. There is a fundamental breach of trust that is hard to fix when one partner lies about money.
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It Can Cause Financial Ruin: This isn’t just about hurt feelings. If your spouse is racking up debt in your name or not paying bills, your credit score can tank, potentially leading to bankruptcy, losing your home, or other serious financial consequences.
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It Creates Power Imbalance: Money is a form of power. When one partner misleads or lies about spending, they’re exercising power unjustly in the relationship.
According to a poll by the National Endowment for Financial Education, the effects of financial infidelity include arguments between partners (42%), less trust in the relationship (32%), and even separation or divorce (16%).
9 Common Reasons People Commit Financial Infidelity
People don’t usually hide financial information just to be deceptive. According to professionals, these are the most common reasons why people cheat on their partners with money:
1. Addiction
Drugs, alcohol, shopping, or gambling addictions often lead to financial deception. One woman shared that after her husband kicked a drug addiction, he replaced it with a shopping habit, hiding designer clothing price tags in their closet while she was selling books just to afford train fare to work.
2. Revenge
Some partners use secret spending as payback when they feel betrayed. One sales executive shared that after he experienced a financial setback, his wife became irate and her spending skyrocketed—she even leased a BMW without telling him.
3. Social Pressure
In our Instagram-obsessed world, some people feel pressure to maintain appearances even when they can’t afford to. This pressure can lead them to hide financial difficulties from their partners.
4. Different Values About Money
Couples often disagree about supporting adult children. One spouse might secretly send money to help an unemployed adult child without the other knowing.
5. Anxiety
Secret spending or hoarding can fulfill deep emotional needs stemming from childhood experiences. Those who grew up with financial instability might hide money as a coping mechanism.
6. Affairs
Sexual and financial infidelity often go hand in hand, as affairs require money that needs to be hidden.
7. Self-Preservation
In controlling relationships, a partner might siphon off money as a way to protect themselves or fund therapy they can’t otherwise access.
8. Shame and Guilt
Sometimes people hide financial troubles because they’re embarrassed. One financial planner mentioned a client whose spouse lost their job but couldn’t bring themselves to admit it, so they pretended to go to work while hiding the truth.
9. Fear of Loss
Many people equate love with financial success. They might lie about money problems because they’re afraid their partner won’t love them if they knew the financial reality.
Warning Signs Your Spouse Might Be Financially Unfaithful
How can you tell if your spouse is hiding financial secrets? Here are some telltale signs to watch for:
- Financial statements no longer coming to your home or being sent to a P.O. box
- Your spouse saying “I’ll take care of it” whenever financial statements arrive
- Passwords changed on online financial accounts without telling you
- No contact allowed with your accountant (shocking fact: many people in their 50s have never signed a tax return despite filing jointly their entire marriage)
- Unusual transactions like large cash withdrawals
- New accounts opened in just their name
- Defensive or stonewalling behavior when money topics come up
- Hidden purchases or receipts
- Lying about prices paid for items
- Secretly withdrawing money from savings
Real-Life Stories of Financial Infidelity
Let me share a few real stories that illustrate how devastating financial infidelity can be:
Lisa’s Story: At 60, Lisa (a successful doctor) discovered her husband had spent huge chunks of their savings on cars, guitars, and charitable gifts. He had borrowed against their home and run up $250,000 in credit card debt. After their divorce, he had the nerve to ask her for money to help with his new $60,000 credit card debt!
Sharon’s Story: Early in her marriage, Sharon had an affair, but she and her husband Travis stayed together. Years later, when both were unemployed, Travis failed to pay their storage unit fees, causing them to lose most of their possessions. He tried to catch up but couldn’t bring himself to tell Sharon until it was too late. Despite financial struggles, they remain married, with Sharon saying, “I must forgive him, as years ago he forgave me.”
Carol’s Story: After divorcing her shopaholic husband, Carol fell in love with Alex, who showed respect for her feelings about money. She realized “Someone who doesn’t consider how their financial behavior affects their partner isn’t behaving in a loving way.”
How to Deal With Financial Infidelity
If you suspect or have discovered financial infidelity in your marriage, here’s what you can do:
1. Have The Money Talk
If you’re new to a relationship, have this conversation ASAP. Even if your approaches to money differ, you should both understand where the other is coming from.
2. Confront or Confess
If you’ve discovered financial infidelity (or committed it yourself), approach your partner calmly. Don’t make wild accusations or enter the conversation angry. Explain what you found (or did) and allow for explanation.
3. Review Financial Records Together
Ask to see any financial paperwork – bank records, credit card bills, tax returns, and investment statements. This helps confirm or soothe your fears.
4. Check Credit Reports
Get credit reports and scores for both you and your partner. These can reveal unknown loans or credit cards taken out in either name.
5. Be Proactive
The days of letting your spouse handle all the money are over. There’s no excuse for financial illiteracy. Find out exactly where you stand financially, including savings, investments, and debts.
6. Consider a Forensic Accountant
If the numbers don’t add up or your partner won’t cooperate, consider hiring a forensic accountant to dig into your financial situation.
7. Create Shared Financial Goals
Work together on a budget that reflects mutual priorities and goals. This helps rebuild financial trust.
8. Get Professional Help
Financial infidelity often requires professional assistance – either from a financial advisor, a therapist, or both. Don’t be afraid to seek help.
9. Rebuild Trust Gradually
Set up weekly “money dates” to go through your finances together, or create a joint Mint or similar account so you can see each other’s financial activity.
10. Know When to Walk Away
If things have gone past the point of no return and you know you could never trust your partner again, it might be time to leave the relationship. Protect yourself financially, emotionally, and physically.
Can a Marriage Survive Financial Infidelity?
The good news is that financial infidelity doesn’t always lead to divorce. Many couples do survive and rebuild trust after financial betrayal. The key factors seem to be:
- Complete honesty going forward
- Willingness to make changes
- Open communication about finances
- Shared financial goals and plans
- Professional help when needed
Preventing Financial Infidelity Before It Happens
The best approach is to prevent financial infidelity from happening in the first place:
- Create a system that works for both of you – Many couples set up an allowance system, which gives each partner some spending freedom while still working toward mutual financial goals.
- Maintain transparency – Regular financial check-ins can help keep both partners informed and involved.
- Respect differences – Recognize that you and your partner might have different attitudes toward money, and find compromises that work.
- Share responsibilities – Don’t let one partner handle all the financial decisions and paperwork.
Final Thoughts
Financial infidelity is a serious issue that affects nearly half of all couples who share finances. The damage it causes goes beyond hurt feelings – it can devastate your financial future and destroy the trust in your relationship.
But with honesty, communication, and sometimes professional help, couples can recover from financial infidelity and build a stronger, more transparent financial partnership.
Have you ever experienced financial infidelity in your relationship? How did you handle it? I’d love to hear your stories and thoughts in the comments below!
Note: Names in some stories have been changed to protect privacy.
Why is financial infidelity harmful?
Loss of trust. Money is already one of the leading reasons for divorce. When two people are not on the same page when it comes to money, there is a lot of potential conflict. Financial infidelity makes things even worse. Seventy-five percent of people who have experienced financial infidelity say that it has negatively impacted their relationship. Infidelity of any kind can erode trust within a relationship, and financial infidelity is no different.
Financial ruin. Yes, financial infidelity can hurt your interpersonal relationships, but it can do a lot more damage than that. If your partner is racking up debt in your name, or not paying the bills, your credit can be severely impacted. This can lead to having to file bankruptcy, losing your house, having your credit score tank, and more. These types of financial issues can follow you far beyond your relationship.
What counts as financial infidelity?
Acts of financial infidelity are wide-ranging. They can be seemingly harmless, or severely damaging. This is different than having your own separate financial accounts. Right now, my boyfriend and I keep our money separate, but we both know what accounts we have and how much we owe each other. I actually recommend to my clients that they have some of their own money, even if they’re married (this will help them down the road if the relationship ends). Financial infidelity is very different than financial independence. Wondering what counts?.
Secret accounts
I’m all about having and using your own money, but your accounts shouldn’t be a secret. If you feel like you have to hide your spending from your partner, something is wrong. If someone has a secret bank account or credit card, they might be spending too much, which could hurt the whole family. There could also be more sinister motives behind these secret accounts. Some people feel the need to hide money from their partner if that partner is abusive. Others might have secret accounts that they use to spend money on an affair or an addiction.
Hiding large purchases
This could consist of making and hiding large purchases, or just making the decision to purchase unilaterally. Again, I think everyone should be able to spend their own money however they want. But if you’re in a relationship, big purchases should be agreed upon by both people. An example of this could be if your partner decides to buy a new car without discussing it with you first. It’s especially damaging if you can’t afford the payments for that new car.
Spending joint funds
If you have joint bank accounts, you should create guidelines for how you each spend that money. For example, you may decide to use joint funds to pay the mortgage, or pay off debt. If you or your partner are pulling from your shared cash to spend on things that are not mutually agreed upon, you’re committing financial infidelity. This act could be particularly alarming to the other partner, because it’s partly their own money that is being spent.
Lying about spending
I’ve heard of people saying that they’re paying the rent or utility bills, and then spending the money on something else. Then when the lights get turned off, or they get evicted, their partner is completely shocked and caught off guard. Saying your money is going one place when it’s really going somewhere else is dishonest and can lead to debt and credit problems.
There are many other actions that can be considered financial infidelity. Learn more here.
The Truth About Financial Infidelity – Dave Ramsey Rant
FAQ
Is financial infidelity the same as cheating?
While financial infidelity is not the same as traditional cheating, it is still a breach of trust in a relationship that usually involves doing money-related things behind the other person’s back. It is a form of lying on a par with emotional, psychological, or physical infidelity.
How do you prove financial infidelity?
Signs of financial cheating while married: Using money to control you; putting off school or work; emptying a savings account; taking money out of a retirement account (without your knowledge); having money taken out of accounts (credit cards, bank accounts, etc.); )Being removed from health/life insurance.
What is the difference between adultery and infidelity?
Infidelity is the broad term for any breach of trust or commitment in a relationship, encompassing both emotional and physical unfaithfulness, while adultery is a specific type of infidelity involving voluntary sexual intercourse between a married person and someone other than their spouse.
Is financial infidelity a cause for divorce?
California is a “no-fault” state, which means that cheating on your spouse with money is not automatically a reason for divorce. However, financial infidelity, which involves a spouse hiding money, debt, or assets, can severely damage the trust in the marriage, leading to the breakdown of the relationship and ultimately a divorce.
What is financial infidelity?
Financial infidelity is an act of deception by a spouse or partner who is leading a double life when it comes to money. “It’s about secrecy,” says Lili Vasileff, a financial planner in Greenwich, Connecticut, who specializes in divorce-related finances and is author of Money & Divorce: The Essential Roadmap to Mastering Financial Decisions.
How does financial infidelity affect a relationship?
Financial infidelity for control may include revenge spending, as one partner overspends to prove their independence or to get back at the other for something lacking in the relationship. Knowingly irresponsible behavior may cause guilt and embarrassment, so the person attempts to cover it up.
What are examples of financial infidelity?
Common examples include hiding debts, making large purchases without telling the other partner, and not being truthful about spending. Financial infidelity can damage trust and relationships and may lead to separation if not addressed. To fix financial infidelity, couples should come clean, create a budget, and possibly seek counseling.
Is financial infidelity threatening your marriage?
Beyond threatening the health and integrity of a marriage, financial infidelity can also threaten the security and solvency of a couple and lead to long-time, potentially serious financial repercussions. This is why recognizing the early warning signs of financial infidelity and taking swift action is so important.
What is the difference between financial infidelity and financial disagreement?
Financial infidelity involves intentionally hiding money or accumulated debts from a partner. A financial disagreement, on the other hand, happens when partners disagree on how money should be spent or saved, but are still open and honest with each other. How Can I Prevent Financial Infidelity?
What does financial infidelity look like?
Financial infidelity, also known as financial cheating, occurs when open communication about money breaks down, leading to secretive or deceptive financial behavior. It might be caused by fear, shame or past financial trauma. Here are some examples of what it may look like.