The Money Secret: Why Couples Keep Finances Hidden and How to Talk About It
For many couples, money can be a source of tension. But what happens when one partner keeps financial secrets from the other? A new Bankrate survey reveals that 42% of US adults in committed relationships have hidden money from their significant other, with reasons ranging from a desire for financial independence to concerns about their partner’s spending habits. This article delves into the motivations behind keeping money secrets, the potential implications for relationships, and offers expert advice on how to foster open and honest financial communication.
Key Takeaways:
- Money secrets are common: A substantial percentage of couples keep finances hidden, highlighting the complex dynamics surrounding money in relationships.
- Motivations vary: Reasons for financial secrecy include protecting finances from a partner’s spending habits, securing individual independence, and even planning a surprise.
- Transparency builds trust: Financial secrecy can erode trust and create resentment, while open communication can strengthen relationships and lead to better financial decisions.
- Finding a balance: Establishing shared financial goals and strategies while allowing for individual financial autonomy can offer a healthy approach to managing finances as a couple.
Ric Shahin’s desire to surprise his wife with a special trip for their 10th anniversary turned into a 25-year-long money secret. He started by secretly depositing $50 from his paycheck every two weeks, later escalating to $150, hoping to gather enough funds for their dream vacation. However, his wife, Martha, became suspicious about the unaccounted money and, although she suspected his intentions were good, was upset that she wasn’t included in the planning.
Financial experts like Autumn Knutson, founder of Styled Wealth, emphasize that even well-intentioned money secrets can cause confusion, frustration, and harm trust, often leaving the partner in the dark and less appreciative than anticipated.
Reasons for Hiding Money:
The reasons for financial secrecy are as diverse as the couples themselves. Some, like Ric Shahin, have seemingly innocent motivations, while others reveal deeper concerns.
- Hidden Concerns: The Bankrate study reveals that 14% of couples hide money because they don’t trust their partner with finances. This can stem from past experiences or a lack of confidence in their partner’s financial decision-making.
- Controlling Spending: Michelle Frey hid money from her husband because she felt he wasn’t a responsible saver, often spending in advance of his next paycheck. This led her to stash money in various hiding places around their home, creating a personal “emergency fund”.
- Securing Financial Independence: Many women, especially those coming of age before the Equal Credit Opportunity Act of 1974, which granted women the right to open bank accounts and credit cards independently, have historically relied on personal stashes. This was seen as a means of empowerment and an escape from potential dependence on financial dependence. Senator Elizabeth Warren underscores this by promoting the concept of "walking-out-the-door money" which provides women with financial security in the face of possible relationship breakdowns.
- A Sense of Control: Keeping money secret can give individuals a sense of control over their finances. This can be particularly relevant in situations where a partner may have a history of controlling spending or where there are significant differences in financial habits.
The Impact of Financial Secrecy:
While the motivations behind hiding money may seem harmless, financial secrecy can negatively impact relationships.
- Erode Trust: The foundation of any healthy relationship is based on trust, including financial transparency. Keeping money secrets undermines this trust, leaving the partner feeling deceived and wondering what else they are hiding.
- Prevent Shared Goals: Financial secrecy can impede the creation and pursuit of shared financial goals. Whether it’s saving for a dream vacation, a down payment on a home, or retirement planning, open communication about financial aspirations is crucial for success.
- Cause Resentment: When one partner discovers a secret financial account, it can lead to feelings of anger, resentment, and hurt. The partner may feel excluded from important financial decisions and perceive that they are being misled.
Experts like Lori Bodenhamer, a financial planner at Abundo Wealth, advise that instead of resorting to hidden accounts, couples should focus on open conversations about their financial goals and establish shared funds for those goals.
Honesty and Transparency:
Addressing financial secrets requires open and honest communication.
- Shared Financial Planning: Couples should engage in open discussions about their spending habits, saving goals, and expectations for managing finances.
- Joint Accounts and Individual Funds: Financial experts recommend creating a joint account for household expenses and separate accounts for individual financial autonomy. This strategy allows for both partnership and personal control, promoting trust and transparency.
- Financial Therapy: If couples find it difficult to communicate about finances on their own, seeking guidance from a qualified financial therapist can provide a neutral and supportive environment to address challenges and build healthy financial habits.
Ultimately, a healthy financial relationship involves open communication, shared goals, and a mutual understanding of individual needs and aspirations. By embracing transparency and working together, couples can build a strong financial foundation for a happy and secure future.
