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Laura Rowley Money & Happiness

Laura Rowley, Money & Happiness

Your Cheating Wallet Will Tell On You

by Laura Rowley

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Posted on Wednesday, February 13, 2008, 12:00AM

According to a new survey by Yahoo! Finance and research firm Decipher, about half of people in serious relationships have committed some kind of financial deception. Their activities include lying about the actual cost of a purchase or hiding it from their partners; covertly running up credit card debt; or maintaining a secret savings stash.

Women are more likely to be dishonest about money than men (or at least admit to it in the survey): 55 percent of women versus 41 percent of men say they've committed financial infidelity. Secrets and lies tend to occur most often among couples in the 35-to-44 age bracket, the study found.

Underlying Problems

"Money is just a symptom," says Belinda Fuchs, a CPA and founder of the financial coaching firm Own Your Money in Boston. "It's really about the underlying lack of communication, stress, and everything else happening in the relationship. You just want to be careful when you start the whole covering-up thing -- because it's like a thread in a coat that starts unraveling."

Sometimes the relationship comes undone: 7 percent of men and 12 percent of women have broken up with a partner because of money-related duplicity, the survey found.

One of the biggest causes of secret spending is the covert payback, says Fuchs. "There's something their spouse did that they get to pay themselves back for -- maybe he was away traveling for the last four days and she had to deal with everything at home, so she feels like she deserves it," says Fuchs. "But people often feel guilty afterward. They're blaming and complaining, and then they're ashamed."

A Hard Landing

That was the story for Chris Matier, a 34-year-old father of two, who says he racked up $22,000 in debt in 18 months after his wife gave birth to their first child.

Matier was 24, and had been married for four years. "We were living in Colorado, which is a great place to be when you're young -- hiking and adventures," says Matier, a middle school teacher and freelance writer. "When a baby comes, there's a shift of priorities in your relationship that's pretty severe. At that moment I didn't understand my new role as a father; there was something wrong with me, some kind of resentment."

Some of the debt occurred because his wife had left work to get her master's degree, and they never adjusted their budget. But a good chunk came from tech gadgets, CDs, videogame systems, and other toys, Matier says.

"It was hidden right out in the open -- she's not interested in gaming, so she didn't know how much was involved," says Matier. "She would see me watching wrestling on TV, but didn't know it was pay-per-view that cost $30. She was absorbed in our new life, waking up in the middle of the night to feed the baby. I took care of the bills. I knew I was screwing up, but it doesn't hurt until you land."

Matier crash-landed one afternoon, ironically enough, while he was out shopping. A debt collector called seeking payment for a medical bill that his wife thought had been paid. "I can remember the look of hurt very clearly," he says. "It was betrayal. I was a cheating spouse, but not by standard definition. She forgave me as soon as she knew I was genuinely sorry -- that took an hour -- but she was mad for a really long time."

Open Up

In some cases, money secrets are motivated by good intentions: One partner may want to protect the other from anxiety or stress. But this puts undue pressure on one person, and leaves the other ignorant about their financial reality -- a huge risk in the event that something happens to the partner running the show.

"I've talked to couples where the wife is totally stressed about money, and keeps it under wraps in an attempt to be strong and keep the family together, and the husband is clueless," Fuchs says. "He has no idea they are under such financial challenges."

Fuchs suggests sharing the information in a nonjudgmental way: "'This is situation I'm in; I need help, let's work together,'" she says. "Be accepting and loving of your partner in working through whatever your challenges are -- put it out on the table. I've seen huge breakthroughs when people take the open and honest approach."

A Costly Struggle

Openness can be tough for couples engaged in a power struggle over finances. Colleen Dennis, 54, who asked that her real name not be used, works full time at a university on the West Coast. She says that although she's financially responsible and has a healthy retirement portfolio, her husband questions every purchase she makes.

"Although I make a good living, he still sees everything I purchase as money out of our family's pocket," Dennis says. "So if I buy something of personal value, like clothes, I hang them up right away, take off the tags, and hide the shopping bag.

"He never spends a dime unless totally necessary, wearing his pants until they have holes in them," she adds. "I don't think you should put off living today for 50 years down the road. I went skiing recently -- it cost $60 for the bus and the lift ticket -- and he had this feeling that I shouldn't be spending that money."

Extended Childhood

After 20 years of marriage, their finances remain in separate silos; neither knows how much the other actually has. "He wants to combine our finances," Dennis says. "I don't want someone standing over me in a paternal way saying, 'No, you can't buy that today' or 'Why did you buy that?' He says I don't trust him. I feel threatened, and don't feel like I'm being treated as an equal."

Dennis says her husband grew up in an extremely frugal family. He started working at age 12 and put himself through college. In his teens, he had an accident while driving a friend's car -- and his savings was wiped out by the repair bill.

Childhood money experiences percolate through adult relationships, says Olivia Mellan, a Washington, D.C., psychotherapist who has specialized in money therapy for 25 years. "Money is symbolically loaded for most people," she says. "It represents love, power, security, control, happiness, self-worth."

A Common Financial Vision

Mellan advises couples to discuss how money was handled in their childhoods, and listen without judging. Create separate lists of short-, medium-, and long-term goals, then compare notes and set priorities. If that doesn't help, it may be worthwhile to see a therapist who specializes in money issues, or a financial planner with a specialty in money psychology.

Instead of fibbing, counselors say, negotiate a personal zone of privacy: How much is OK to spend without asking the other person? The Yahoo! Finance survey found that 45 percent of respondents agreed that it was fine to spend $100 to $500 without consulting their partner; a third said $100 or less was acceptable.

Couples who are open and honest about money are the ones who "have a larger vision of what they are working toward," explains Fuchs. "Their daily decisions are OK because they know where they are going and why. When couples aren't aligned on a larger vision of where they are going, that's when you get into skeletons-in-the-closets kind of activity."

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  • nate - Monday, February 18, 2008, 5:40PM ET  Report Abuse

    • Overall: 3/5

    I am a 29 year old male from IL. I own my own business and was married for 4 years and now am divorced for the past year. A big reason for my divorce was because of money. My ex-wife worked off and on through out our marriage but over the 4 years we were married she worked maybe 2 years total. So most our income came from my business. Like any other business there are the down times and the up times. My ex-wife spent money at will regardless of the amount of money we had coming in. Am I putting her down? No. The lack of communication is what lead to finacial problems and eventually our divorce. Communication is key. Not only in being happy knowing what eachother wants in the relationship, but also finacially, spirtually, and any other form. If it's a topic that will effect both people even in the tiniest way, it should be discussed before a decision is made. It all depends on the relationship and the people involved. If you don't think it's a big deal to purchase something without discussing it with your partner, then you should have no problem bringing it to their attention before you do.

  • Yahoo! Finance User - Monday, February 18, 2008, 12:18PM ET  Report Abuse

    • Overall: 4/5

    Very interesting article. My wife of 21 yrs. did something very similar to these stories and hid over $20k in credit card debt from me for 4-5 yrs. It was like finding a secret life or relationship about her that I never knew existed. I was floored. The pain/trust issue is still touchy even after a year later and some counseling. Still moving forward together but it takes a lot of work. If I could offer a little advice please talk to your spouse a lot and it great depth and detail about finances and other topics before and continue to do so after you commit to a marriage. It may not be a 100% guarantee against something going wrong but in my case I'm sure it would have helped. Thank you for the article Laura and please follow it up with more advice. Thanks.

  • Yahoo! Finance User - Monday, February 18, 2008, 10:45AM ET  Report Abuse

    • Overall: 5/5

    My son and daughter-in-law have large financial problems. He has even started a secret savings in an attempt to keep spending under control. He doesn't know how to approach her about it. She helps her family. She doesn't work away but they have 2 children and now another due in April. I don't know how to advise him.

  • Yahoo! Finance User - Monday, February 18, 2008, 10:27AM ET  Report Abuse

    • Overall: 5/5

    My husband is the breadwinner in our home and I stay home with our children. I do all of our finances and track our spending and savings in an Excel sheet. At the beginning of every month he sits down at the computer with me and we go over my spreadsheet. It helps me to know that I have a hand in our finances even though I am not earning a paycheck, and I feel a real sense of accomplishment every month when I see how much I was able to save of on our household expenses. I can't imagine spending $100 on something without discussing it first!

  • Matthew - Monday, February 18, 2008, 10:18AM ET  Report Abuse

    • Overall: 4/5

    My spouse and I have had similar problems. We have actually done the opposite of what has been recommended and it has solved the problem. Separate finances, and no joint credit cards. I am able to maintain my good credit, and we each do as we wish but share the bills. I am no longer having to hound my spouse about every purchase, which is a big burdern gone for both of us. We talk often about the bills, and each chip in from our separate bank accounts. I works like a dream. A lot of this type of problem is about control and power over the money. Now I have mine, they have theirs, and everything works out. We have very little credit card debt, less than $800 combined, and we both feel we have financial freedom. We both have two cards with very small balances. But even if one of us does something stupid, the other's credit report is not involved. Separate finances can be the way to go for many people if you and your spouse have different spending styles and habits!

  • Yahoo! Finance User - Monday, February 18, 2008, 9:52AM ET  Report Abuse

    • Overall: 5/5

    We have been married less than a year and this is already creeping in. I handle the money but my husband spends with credit cards and misrepresents how much he has and is spending. I don't find out until I pay the bills. Its a real sore spot but we are talking about it. I have decided not to pay down the balance on the cards until I can trust him not to run them up again. If they all remain maxed out - he can't spend much more. I know of lot of the issue has to do with the fact that I am the breadwinner in the household and in a very traditional household, the husband does not want to ask the wife for permission to purchase something he feels is needed for the family. It will work out but I won't pay off the cards until I'm sure they will not be used again except for an emercency.

  • DENNIS WILLIAM - Monday, February 18, 2008, 8:32AM ET  Report Abuse

    • Overall: 5/5

    More couples should read this, and similar articles, before marriage. Problems in the financial area is the number one cause of brakeups in relationships. WM

  • Michael C - Monday, February 18, 2008, 8:28AM ET  Report Abuse

    • Overall: 5/5

    This is a bigger problem than the world wants to admit. We would be great if we could point a finger at one gender but it happens on both sides. I wish my wife can understand that I am ready to leave if she can not control her spending. She believes if its for the family then there should not be a problem. Hopefully this article will help us get started in the right way.

  • J-Nelly - Monday, February 18, 2008, 2:14AM ET  Report Abuse

    • Overall: 5/5

    Female Football Freak is absolutely right! She was so smart not to marry the man who lied about his cc charges, etc. I wasn't so smart and found myself married to a man who ran our finances in the ground! He had a lied about EvErYtHinG! I divorced him; fortunately there were no children between us. However, I feel I have a lot of catching up to do because of the time wasted in that relationship. Every woman needs to be plugged into financial decisions when married!!!

  • Female Football Freak - Monday, February 18, 2008, 1:41AM ET  Report Abuse

    • Overall: 4/5

    I, too was almost burned by financial infidelity. When engaged I discovered a cc statement on his dresser with a balance in the thousands. When he was confronted he said they were his dad's charges (liar). A little later I had reservations about his job search. After a little digging I discovered he had lied about graduating college. My point is that financial disgressions may be a sign of deeper issues or other lies. Today I am married (15 years) to a partner who shares the same financial goals. We plan and discuss any major purchases. I no longer work but we both have a "mad money" allowance in separate checking accounts. He does all the bill paying and I track it all in Quicken.

  • CEE GEE - Monday, February 18, 2008, 1:25AM ET  Report Abuse

    • Overall: 5/5

    Thank you Dr. Henry. Well said. cg

  • Yahoo! Finance User - Sunday, February 17, 2008, 5:26PM ET  Report Abuse

    • Overall: 5/5

    young &beautifull women need no money,later in life they cannot get enough!

  • dead-on - Sunday, February 17, 2008, 1:10PM ET  Report Abuse

    • Overall: 5/5

    In OUR home, I handle the finances because we agree that I handle money better than he does! This DOES lead to some arguments when we are short on cash and he wants some new movie DVD's, especially during the winter when our heating bills are higher.

  • Yahoo! Finance User - Sunday, February 17, 2008, 12:14PM ET  Report Abuse

    • Overall: 5/5

    I went through a horrible expereince with my spouse which lead to bankruptcy, loss of all our savings and almost foreclosure. My wife racked up over 130K in debt using my name and credit without my knowledge, opened bank accounts and had a PO box as her address. I worked all the time and just handed her my paycheck. Although I was on top of our home expenses I never saw the other life she was living. That was 2003. We have since rebuit, but our credit is ruined, and we just came out of bankruptcy. I have forgiven her, although staying together has been a struggle. Its a daily event to rebuild Everyone should be involvolved with the day-to-day finances. Like i tell her today, I pay attention to every penny, not just the dollars. I also track my SS number, and all bank accounts to avoid fraud. My name is watched by two companies. It is a long haul to rebuild. So my advice to everyone who is dealing with financial issues and their spouse..... 1. question everything, its your right. 2. don't accept the simple answer, ask for receipts and statements. Its not private the minute you took vows. 3. Work together on a finanaical plan and goals...you should be working together 4. have separate accounts for your own dignity but have a joint account for the major bills and expenses. 5. Build relationships around life not money. 6. Stay in tune with the way money works. most of the time we are all ignorant to the way money works. I know I was... Just as a side note. My wife and I are College educated and have great careers I have an MBA and a Doctorate in managment. I have owned business and managed companies...None of this mattered. Education and having income alone will not be stronger than simple trust and common unified goal as a family and couple. good luck to those who are just finding out about thir spouse or other close family members financial secrets. i know the pain you are going through. Dr. Henry

  • Jesse - Saturday, February 16, 2008, 4:56PM ET  Report Abuse

    • Overall: 5/5

    nicely written and organized with good content. BUT, it is not for me because we just enjoy making money by hard work and investing. NO lottery tickets, etc. No budget, no separate accounts. just alot of love and good fortune. got enough for all the necessaries, a few luxuries, and some to give away. GOSH

  • Joe - Saturday, February 16, 2008, 3:48PM ET  Report Abuse

    • Overall: 3/5

    A bit light, but then this isn't the Times. Good article.

  • Herbert - Friday, February 15, 2008, 9:19PM ET  Report Abuse

    • Overall: 5/5

    My wife and I had a system similar to some described we both paid toward the bills and did with the rest what we saw fit, i was always better at managing money than her and tried to teach her to be smart about things, savings, keeping cc bills at zero or low, worked for 12 years , I always thought we had a great relationship until one day she broke down and asked me to sign for a second mortgage, turns out she lost 46K gambling , i was crushed , I felt so betrayed, the money wasn't the issue it was the loss of the trust, i consoled her and we took care of it, now at 17 years i am in the middle of divorce , the infidelity now with another man, the secretiveness described in the articles is very indicative of something larger going on, next time if i can, i will surely time the time to really see what kind of person i am getting involved with!!! wish i'd read this 17 years ago.

  • David - Friday, February 15, 2008, 7:39PM ET  Report Abuse

    • Overall: 5/5

    Great info

  • geinsevd - Friday, February 15, 2008, 4:50PM ET  Report Abuse

    • Overall: 2/5

    IMO It is very difficult to find a partner who will be financially responsible. When married a mate can spend as they will and not much can be done. A faithful mate is equally difficult to find. If you have a good partner take good care of the relationship. As an example enter the very minimum yearly salary on Yahoo Personals and count the responses. It won't be a very high number. The world may have reached such a point that money is required to hold a partner's interest.

  • Yahoo! Finance User - Friday, February 15, 2008, 2:27PM ET  Report Abuse

    • Overall: 5/5

    This is a fantastic column, dealing with something that impacts everyone who has an obligation to someone else. A great demonstration that money is much more than simple dollars and cents. Thanks, Rowley~!

  • Yahoo! Finance User - Friday, February 15, 2008, 2:27PM ET  Report Abuse

    • Overall: 4/5

    My wife and I have a system that has eliminated money and spending issues for us. We figure out what our joint costs are (mortgage, taxes, food, utilities, and a set $ amount for joint savings) and then each pay proportionately what we earn (my self appx 60%/ wife 40%) into a joint checking account. The rest of our paychecks can go to whatever we want without having to ‘clear’ it with the other. Then once a month we sit down together and go over our family budget to see how we are doing. We’ve been together for 7 years and not once have we fought about money. This plan wouldn't work for single earner families but its perfect for us.

  • Love2Fly - Friday, February 15, 2008, 10:28AM ET  Report Abuse

    • Overall: 4/5

    I do all the financials at home, and I print out monthly reports to show my wife all expenses, income and savings. I keep track of all possible money exits like ATM withdraws, paper and e-checks, credit cards, charge cards and I also use bank alerts; anything my wife expends, I'll know about. Thus far, we have both shown to be responsible expenders and savers. Besides health, nothing else compares to the piece of mind given by financial security.

  • cowboy47201 - Friday, February 15, 2008, 8:52AM ET  Report Abuse

    • Overall: 5/5

    I think the whole "secretness" of money in the society is weird. I at one point worked in the federal govt and everyone knew how much everyone else made. Then I went into a big corporation where I was told that compensation is confidential. That created tons of problems in my view. Also was in a relationship where lots of debt was hidden even though I was completely open about my finances. It always has puzzled me why we make so much of this. Do we really think money makes the person? Are we that shallow?

  • Yahoo! Finance User - Friday, February 15, 2008, 12:18AM ET  Report Abuse

    • Overall: 3/5

    A response to a couple of the comments: personal situations vary, and I don't think it's possible to say there's one way in which all couples should work. My wife and I were both highly independent people when we got together - and so we keep separate bank accounts, but we have access to each other's, help each other out with emergencies, and collaborate on big items and saving. If you've got an arrangement that maintains the level of both independence and trust you both need that's the key... and no one size fits all! (PS: we've been happily together almost 9 years now...)

  • Yahoo! Finance User - Thursday, February 14, 2008, 11:02PM ET  Report Abuse

    • Overall: 5/5

    This column was interesting and very true for most couples. Finding someone who is on the same page when it comes to finance is critical...To the people who started these comments who assumed the bashers and haters would be plentiful were wrong. The bashers and haters make negative comments on the columns that have flaws. In the future, just post your thoughts. Don't worry about what others may write.

  • Yahoo! Finance User - Thursday, February 14, 2008, 7:45PM ET  Report Abuse

    • Overall: 4/5

    Oops, I meant to give 3 stars. Laura managed to write a whole article without giving one piece of her opinion or idea. So what's the conclusion? Be open and honest? That's soooo obvious. Please. I would come down much harder on this one, especially about keeping separate finances in a marriage. That's a poison pill in any marriage that will eat away at a relationship for years, often leading to divorce. I've seen it first hand. If a couple can't share their money in a marriage, they should not get married. They can't trust each other. Plain and simple.

  • Jill - Thursday, February 14, 2008, 5:51PM ET  Report Abuse

    • Overall: 4/5

    Very Good Article.... I am in a second marriage for 10 1/2 years. We are on the same page when it comes to our finances. I pay the bills & keep up with the money. He has easy access to everything I do in files or online. We do our finances together. I would also recommend that anyone thinking about getting married should have their future sponse pull their credit report & give you a finance statement of their earnings/debit before tying the knot. It is better to know up front if your future sponse is really being Honest with you & Money is usually the Key Element to find out if some it honest or not.

  • Yahoo! Finance User - Thursday, February 14, 2008, 5:17PM ET  Report Abuse

    • Overall: 5/5

    The article presents a lot of situations that I look back now and see as what really happened in my marriage -- covert payback for example. We worked through it all but it's interesting to understand it. I like Laura's scholarly approach to everyday finances. She makes you see the larger picture and how you fit in.

  • Yahoo! Finance User - Thursday, February 14, 2008, 4:43PM ET  Report Abuse

    • Overall: 5/5

    Fantastic article... Why not let Mrs. Rowley write more often and let Suze Orman go? That's a win win for the Yahoo! community

  • Yahoo! Finance User - Thursday, February 14, 2008, 4:14PM ET  Report Abuse

    • Overall: 4/5

    I knew before I met my fiancee that I would need my future wife to handle money well. She's got a little background in business and knows how to budget and plan ahead. That's not by any means the only reason I love her, but one area that shows her intelligence and consideration. We discuss all of our finances, and have a lot of openness about that. I have had to work at not questioning her spending and trusting her, but she has proven that she is worth it. Before I proposed to her, she didn't know how much money I earn because I live well below my means, which helped to assure me that she would marry me for who I am and not for what I have. We have a lot of financial goals together, and are excited about meeting those and the future we will have together. I wish more people could experience what we have.

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