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Financial infidelity – what it is and how to mend wounds 

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Infidelity is when an agreement between two partners has been breached, a broken promise. Infidelity is most commonly of the romantic kind, leading to distrust and in most cases the end of the relationship.

However, infidelity can also be financial.

Financial infidelity is when a partner deliberately lies and hides money spent or gained in a financially combined relationship. When a partner breaches the financial agreement with their loved one this can amount to difficulties, tensions and even the breakdown of the relationship.

A survey in the U.S. advised that one in three couples have experienced financial infidelity in their relationship, with 10.4% spending money from their savings.

The main reason a couple combines their finances is to achieve a common goal, such as buying a house, for their retirement plan or for their children/grandchildren’s future. When one partner engages in financial infidelity, the breach of trust and neglect over the relationship’s mutual goal can cause significant stress. Any debts generated can become the other partner’s debt too.

What is financial infidelity?

There are many ways financial infidelity can manifest in a relationship, these can include lying about your income, hidden accumulated debt or any financial information your partner should know about.

Other forms of financial dishonesty include:

  • Expensive purchases and lying about the true cost
  • Hiding large amounts of cash from your partner
  • Taking money out of the retirement or saving fund without discussing it with your partner
  • Having secret bank accounts, credit cards or loans

Financial infidelity warning signs

Although financial infidelity hurts the partner, it’s more than often that the individual who does this doesn’t set out with the intention to hurt their loved one. Hiding the financial struggles and hardships can cause feelings of guilt and shame, and the longer the infidelity continues the more this can encourage dishonesty.

It can be tricky to notice the dishonesty from your partner, especially if they oversee and manage the administrative side of your finances. Here are some common warning signs to be aware of:

Change in lifestyle – You’ve noticed your partner is spending more on gifts, trips and making lavish purchases.

Defensive behaviour – As sensitive as the topic of finances can be, your partner is very defensive when the conversation arises.

Removal from/added on an account – Without telling you, your partner has removed your name from a credit card or joint account or added your name to it, without your knowledge.

Frequent cash withdrawals – You’ve noticed large quantities and consistent cash withdrawals from your joint accounts that your partner can’t justify.

Secretive behaviour – Not only will your partner become defensive but also secretive about your bank account and go to great effort to hide information regarding your bills and finances.

How to overcome financial infidelity

To avoid or overcome financial infidelity in a relationship, strong communication, transparency, openness and, of course, honesty are vital. Steps can include:

Regular money conversations and check ins – It might be worth setting a monthly date in your diaries to discuss finances, look through your statements and check in that you’re on track with your financial goals. This can also create an opportunity to raise any questions with each other and opens the conversation for any money worries the other might have.

Build a recovery plan – If your relationship has been subject to financial infidelity it’s important to build a recovery plan. This involves reviewing your current income and expenditure, building a budget and creating financial discipline to ensure that any debt is cleared and your savings pot can begin to flourish again.

Consider counselling – If you find your relationship is struggling to move past the dishonesty, a counsellor could be an option. An unbiased mediator can help mend the partnership.

Financial infidelity can uncover deeper issues within an individual and difficulties with their mental health, such as compulsive shopping and we recognise that our financial wellbeing can sometimes have an impact on our mental wellbeing.

If you have any concerns about your own mental health, then we would recommend seeking support from a professional organisation. The mental health charity, Mind, provides information and advice to anyone experiencing a mental health problem.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551