Financial infidelity
Some 43% of U.S. adults have committed at least one financial deception in a current or past relationship in which finances were commingled, according to a poll by the National Endowment for Financial Education (NEFE). The majority of these couples said the lies and omissions regarding money negatively impacted their relationships.
However, the term “financial infidelity” includes a broad range of behaviors, from hiding a small guilty-pleasure purchase to outright fraud and embezzlement. Sarah’s experience is on the latter end of that spectrum.
“The level of financial infidelity you’ve experienced is the level of an affair,” co-host Rachel Cruze told Sarah.
As with physical infidelity, financial deception can destroy a relationship. About 10% of couples who have experienced financial infidelity have divorced because of the issue, according to a study published in the Journal of Financial Therapy.
Unfortunately, with two young kids involved, Sarah doesn’t believe divorce is an option for her. Couples therapy is off the table too because, “to be quite frank, it’s not something we can afford right now,” she said. Instead, she’s taking steps to protect herself from further losses.
Discover how a simple decision today could lead to an extra $1.3 million in retirement
Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.
Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.
Read MoreSarah’s financial firewall
With divorce and family therapy out of consideration, Sarah said, she has moved to protect her finances by creating a firewall. The couple have split bank accounts and unmingled funds while they’re also working with a lawyer to sign a postnuptial agreement to reflect their current financial status.
Half of divorce lawyers surveyed in 2015 by the American Academy of Matrimonial Lawyers said they saw a rise in the number of postnuptial agreements requested by their clients. And 7% of these lawyers said they included an “infidelity” clause in such agreements.
Separate finances are also increasingly common. A recent survey found that only 43% of American couples had joint finances, with Gen Z couples the least likely to combine their accounts.
Whether separate finances, prenups or postnups have any impact on the chances of financial infidelity is unknown, these moves could limit the damage from a cheating partner.
This 2 minute move could knock $500/year off your car insurance in 2024
OfficialCarInsurance.com lets you compare quotes from trusted brands, such as Progressive, Allstate and GEICO to make sure you're getting the best deal.
You can switch to a more affordable auto insurance option in 2 minutes by providing some information about yourself and your vehicle and choosing from their tailor-made results. Find offers as low as $29 a month.
