Are you committing financial infidelity?

By Marianne Curphey

Financial infidelity can range from hiding an impulse purchase of new shoes, to having large credit card debts that threaten your financial stability and wellbeing. If you're hiding such things from your partner, you are not alone: Nearly half of all couples have a savings nest egg that is secret from their partner.

According to Post Office Savings, two in five (41%) secret savers are hiding their savings from their partners.  Those who are married (27%) are much more likely to keep their savings concealed from their spouse than those co-habiting or in a more casual relationship (14%). Savings secrecy causes tension, though, and for 16% of married couples it has caused a

Why honesty is the best policy
Karen Pine, professor of developmental psychology at the University of Hertfordshire and author of Sheconomics, says that the financial dynamics within a couple can be a predictor of whether the relationship as a whole is working. In other words, if you can't communicate with your spouse or partner about financial issues, then there may be issues of trust or control that you need to resolve.

"As a couple, you can become a financial unit," says Becky Wright of New Leaf Life Design Counselling and Coaching. "You can often find that one partner focuses on worrying about earning and saving money while the other avoids thinking about it," she explains. "Or perhaps one partner values spending money for pleasure whilst the other prefers to purchase more practical requirements."

Finding ways to communicate your differences and also spending time noticing where they come from in your lives can start to help you explore what unites the relationship, rather than what separates you both, she says.

Steve Rees, Managing Director of debt consultant Vincent Bond & Co, says money issues can be challenging for couples. "I appreciate it is not the most romantic thing to be talking about when you are staring into each other's eyes across the dinner table," he says. "But a little financial reality at this stage could help you out later on."

If you have joint bank accounts, for example, you could end up arguing if one partner finds out that the other has been less than honest about his or her spending.

"You are both liable for the debt -- contrary to popular belief, if you have a joint loan such as a mortgage or a credit card, then, in most cases, you are both responsible for the whole repayment of that debt," says Rees.

So what if the worst happens?
If you can't resolve your money differences and you decide to split up, you need to make sure your financial affairs are separate, says Rees.

"If you split, tell the credit reference agencies -- they will probably not be the first on your list when it comes to spreading the bad news, but, by separating yourself financially from a previous partner, you are protecting your own credit rating for the future," he says.

So what do we lie about? Here are the most common secrets we hide from our loved ones:

1. Debt and bills
Research from credit reference agency Equifax found that almost one in five consumers had previously kept details of a personal loan or credit card debt secret from their partner. 

"If you are planning to take out any joint financial agreements -- whether it's a mortgage, finance for the family car or just a mobile phone agreement -- it's really important to be upfront about any financial agreements," says Neil Munroe, External Affairs Director, Equifax.

2. How much you've spent
It is easy to rationalise our spending to ourselves, e.g.: "I really need those new shoes for an office function," or "That handbag will be a good investment." But it is more difficult to justify it to our partner, which is why we often sidestep the issue.

3. New purchases
If you can't face lying to your partner about the cost of something, you might hide it for a few months until any suspicion has subsided -- or the bill has been paid off.

It is also easier to buy items online and have them delivered to your home or office, so you are not arousing suspicion by numerous visits to the shops. Not telling your partner, though, could be storing up trouble for the future.

"When we try and get a short term fix by spending, we can often be left dissatisfied soon afterwards as you add that new item to others that tried to meet the same need," says Wright. In other words, you may find that hiding purchases becomes more and more of a habit, and it is more difficult over time to be honest.

4. Bank accounts
While family used to keep finances together, now many couples have their own bank accounts and keep their finances separate.

Men might have a "motorbike fund" and many women are secretly contributing to a "running away fund" in preparation for leaving their partner, says Wright. Such financial infidelity starts to seep into other areas of your life, destroying trust.

5. Inherited money
Receiving money from parents or a relative can be a tricky issue to negotiate with a partner, as some people feel the money belongs to them, and they fear their partner might spend it if they knew.

How to seek help
Financial infidelity is often a sign that you are struggling with money issues and need help. If you can't talk to your partner straight away, you can seek help from money counselling services such as National Debtline or StepChange debt charity.

See related: One in four expect to see partner's credit report, 6 rules for dealing with joint credit card debt during a divorce

Published: 28 October 2013