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Financial infidelity: How to stop the money lies

Young husband working in the kitchen while his wife pours a glass of water.

Dr. Zheng (not his real name) is an emergency physician. Married for 13 years, he’s never cheated on his wife and he’s confident that he never will. Yet Dr. Zheng has a nagging, ongoing secret that he keeps from her.

He has a private credit card that he sometimes accesses after he experiences a particularly stressful period at the hospital and gets the urge to splurge on something off-budget, frivolous and expensive. A $3,000-plus graphite golf iron, for example. Or a $2,400 leather Prada briefcase.

People like Dr. Zheng are guilty of financial infidelity — and there are plenty of them. A 2018 survey of 1,550 Canadians conducted by the polling firm Leger found that 36% of those in relationships actively lied to their partners about finances. As well, 34% intentionally kept their significant others in the dark about certain money matters — lies of omission.

These hidden actions can take many forms. Some people use the food budget to buy gift cards at the supermarket as a way to make secret purchases later. Others establish secret bank accounts — either at home or offshore — that they alone can access. Or they set up a hidden account with a sibling or parent. Still others hide a recent raise or inheritance. Some keep valuables in a secret safety deposit box.

However it’s done, though, financial infidelity is an equal opportunity problem. The survey found that men and women are equally likely to keep money secrets from their partners or to lie to them about a financial matter.

Financial infidelity can damage otherwise solid relationships. If you find yourself facing this problem, it’s important to get things in hand now.

Talk to your partner about debt

Whether you’re the source of the issue or the one who has been kept in the dark, communication is the first crucial step in moving forward. Schedule a meeting to discuss the situation. But wait for the emotional temperature to cool so both of you can address the problem rationally.

Once you’re ready to meet, both of you should bring your financial information — credit cards, line-of-credit balances, car loans and so on — to the table. Be honest about any methods either of you might have used to hide money. Depending on your relationship, you may already have an understanding on what is shared and what belongs to each person.

Based on that understanding, you can reveal bank accounts, gift cards, safety deposit boxes and new sources of income you may have. Then, put this information aside for the moment.

First, have a calm and open conversation about the root of the problem. If you need a neutral third party to help you do so, a financial advisor can help you look at your financial situation rationally together. If you suspect your problems run deeper — perhaps you have trust issues —seeing a couples counsellor might be in order.

Analyze your finances and spending

Now’s the time to examine the books. Overcoming financial infidelity must be a joint effort. Make a firm commitment to work together, and dedicate as much time as you need to do so. Take a critical look at everything you plan to spend going forward.

After accounting for necessities — food, shelter, car loan and student loan payments, for example — assess how much disposable income remains and analyze where, when and how any overspending may occur. Evaluate your credit card balances and loans. Close any secret accounts. Cash in gift cards while they’re still valid. Empty safety deposit boxes that you don’t share with your partner. Reveal new money sources—a recent inheritance or a raise in pay, for example — that you might have.

Ensure that you both agree on how you will deal with your finances. If you prefer to manage some finances individually, that’s perfectly fine. The key is to be transparent and aligned about how finances are dealt with.

No more money secrets

With the financial infidelity out in the open, the worst is over. Moving forward, agree to a solid plan to ensure that you both understand and follow the expectations you’ve set as a couple. Acknowledge each other’s efforts and celebrate together as you rebuild.

The take-away: Financial lies can damage your happiness as a couple, but you can move past them if you don’t let them fester. So if this story speaks to you, no more secrets. Act now.

The above information should not be construed as offering specific financial, investment, foreign or domestic taxation, legal, accounting or similar professional advice nor is it intended to replace the advice of independent tax, accounting or legal professionals.