Dealing with people who cheat their partners financially

Financial milestones: what one partner may consider financial infidelity may not even be considered as such by the other person

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In an ongoing series, the Financial Post explores personal finance issues related to major life stages, from marriage to retirement.

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Ideally, one would have a conversation or conversations with their significant other about financial planning before committing to a life together. How much money is yours, how much is theirs, and what the two of you share are all essential to understand before you are a few years past “I do”. Yet sometimes, despite the best efforts of both parties, financial infidelity can occur.

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Financial infidelity is not necessarily limited to couples, but it occurs when one person in a group with combined finances lies about excessively large purchases or hidden debts. In the age of email, hiding debts is easier than ever. But approaching such conversations from the perspective of the financial swinger or partner in the dark is harder than ever.

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“Every individual on the planet has a different experience with money,” said Aileen Miziolek, Certified Financial Planner at Family Business Consulting Group. “If people aren’t aware of themselves (of this experience), they can sabotage themselves in their relationship and not really realize what they’re doing.”

In Miziolek’s experience, some of the most common root causes of financial infidelity are fear, such as fear of not having enough, coming from a background less wealthy than one’s spouse, or a lack of pre-existing trust in the relationship. Sometimes it’s as simple as a lack of financial literacy.

Sometimes, however, the cause is less complicated: the relationship lacks the necessary structures.

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“One person may accept loose structure, another may need (detailed) structure to understand how they achieve their goals,” Miziolek said. “Both people need to be aware of their own structures and both people need to be aware of each other and put the right structures in place to help them succeed.”

For the person responsible for the infidelity, Miziolek recommends asking themselves why they are afraid to have a conversation about money with their partner before committing the sin.

One answer may be embarrassment, something personal finance author Kelley Keehn said is a common thread in conversations about financial infidelity she’s been made aware of.

“It’s the anger, the frustration of having to explain themselves, it’s the embarrassment of having to hide the purchase, but they still feel justified in the purchase,” she said. “A very kind of child-parent (relationship).”

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Ideally, both partners are as open as possible when discussing past or current infidelities. But since money is never just about money, outside help, such as a financial counselor or even a couples therapist, may be needed to overcome the indiscretion.

What one partner may view as financial infidelity may not even be perceived as such by the other person, which can naturally complicate the idea that the two need to trust each other to make good financial decisions.

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There’s also a gray area between infidelity and annoyance, Keehn said. Something like secretly ordering Uber Eats to work every day for a period of time might not break a couple’s strict agreement, but it would just be for the other partner to be “a little upset” about the charges. The easiest way to avoid these pitfalls is to determine your individual and partnership financial needs.

At the same time, there may be future emergencies that warrant immediate expenditures. Obviously, it’s a bad idea to keep these events a secret from your partner, but there’s also a perfect way to handle them.

“You can just keep focusing the conversation on, ‘Well, I did my best with the information I had, what would you like me to do in the future? If you were in my situation, what would you have done?” Keehn said. “I also think it’s important to forgive yourself, knowing that you did the best you could with the information you had.

Whether or not couples are able to recover from financial infidelity once discovered really depends on the transgression in question. It doesn’t matter what each considers infidelity and the circumstances surrounding it. All relationships have an arc, and sometimes an event can end everything.

“I guess it depends on the degree of financial infidelity, how long it lasted, and how much of a shock it caused the other person,” Keehn said. “It can end a relationship for sure.”

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