What Is Financial Infidelity? Common Signs & Examples

What Is Financial Infidelity?

Financial infidelity occurs when one engages in any financial behavior expected to be disapproved of by their partner and intentionally hides or lies about this behavior.¹ Studies vary, but financial infidelity occurs in somewhere around 27% – 41% of relationships.^{1, 2} Compared to other types of infidelity, financial infidelity tends to occur more frequently.

Some specific examples of financial infidelity include:

• Large amounts of money withdrawn from joint accounts without explanation
• Money from a joint account is taken to pay a personal debt
• One partner has been contributing less than their agreed-upon share to a joint account
• One or both partners lie about having spent money
• One or both partners have previously undisclosed debts
• One or both partners spend large sums of money without disclosing purchase decisions beforehand
• One or both partners attempt to hide financial decisions that go against their partner’s expectations
• One or both partners attempt to hide financial decisions outside an agreed-upon budget
• One of both partners has a shopping addiction and try to hide the purchases from their partner

How Does Financial Infidelity Impact a Relationship

Financial infidelity can very easily destroy trust within a relationship and is considered financial cheating by many. It is a violation of trust to hide and lie about financial decisions that impact the other person in the relationship. The victim of repeated financial infidelity can be left feeling betrayed, ignored, unimportant, foolish, and angry, among many other emotions. Recovering from financial infidelity can be a long process focused on rebuilding trust and repairing other relationship dynamics that may be contributing factors.

Reasons for Financial Infidelity

For the most part, financial infidelity occurs because of an inability or refusal to deny or control impulses to spend money. These impulses may stem from a desire for control, but they may also be because of fear and shame, emotional stress, gambling addiction, or something else. There are many reasons for infidelity.

Some of the reasons people commit financial infidelity include:

• Control: Someone with control issues needs a sense of control that can drive them to engage in odd behavior aimed toward themselves or outwardly. This need can easily create an impulse to spend to create a sense of control. Externally, it can also lead to behavior more like financial abuse, where someone attempts to control others in their life by manipulating their combined or personal financial situation.
• Fear: Fear can drive people to spend money unnecessarily to avoid missing out on something, like a deal, or even to purchase something they have been convinced they need at the moment. Fear plays into base impulses and can lead to more impulsive behavior, creating situations where you make purchases without consulting your partner as you would normally do otherwise.
• Guilt: Guilt can act as a catalyst for seeking comfort by spending, again setting off impulsive behavior around spending to seek relief. It can also drive you to purchase things for others, make financial decisions out of obligation, and create a dynamic where factors outside your relationship drive decisions that greatly affect your relationship financially.
• Revenge spending: Sometimes, conflict in a relationship can lead you to retaliate by spending money to get back at your partner or get one over on them. This unhealthy behavior can lead to severe financial and relationship issues.
• Narcissism: People with Narcissistic Personality Disorder often feel entitled to any money brought into a relationship and do not see a need to run financial decisions by a partner. This can lead to situations where the partner of someone with NPD is vulnerable to financial abuse and left out of decisions around finances in the relationship.
• Sexism: The view that the opposite sex, by their nature, is incapable of making sound decisions or is generally untrusted to spend money wisely can leave the partner in a relationship out of the picture when it comes to financial decisions. Sexism is a toxic thing to have in a relationship in the first place, as there is an inherent lack of trust in your partner with this belief.

12 Signs of Financial Infidelity

Financial infidelity can manifest itself by feeling left out of financial decisions, finding out late about bills or purchases, and having no knowledge of how the finances in the relationship work among other things.

Here are 12 financial infidelity red flags:

1. Private about finances
2. Defensive about finances
3. Projects accusations about finances onto partner
4. Stonewalling when it comes to discussing finances
5. Has hidden money-related information in the past
6. Is secretive about where the money comes from for large purchases
7. Leaves the partner out of big financial decisions
8. Has a secret bank account separate from their partner
9. Is cryptic about income with their partner
10. Spends money on others but not their partner
11. Keeps financial records and bills from partner
12. Will not budget or plan for the future financially

What to Do About Financial Infidelity in Your Relationship

If you believe there is financial infidelity in your relationship, it is important to encourage open communication about finances with your partner, set healthy boundaries around money and its role in the relationship, and commit to changing. It may also be necessary to seek professional help with financial infidelity in a relationship.

Below are tips for addressing financial infidelity in a relationship:

Talk Openly About Finances

Open, healthy communication in a relationship is essential to moving forward after discovering financial infidelity. One of the best methods to do this, specifically around finances, is to sit down together and create an expense summary for the prior month. This will help start conversations about where money is going and why.

Set Healthy Boundaries Around Finances

Setting boundaries is essential to moving forward in rebuilding trust in a relationship after discovering financial infidelity. One thing to try is setting spending limits for each person or a dollar amount for purchases that has to be run by the other and agreed upon first.

Decide How to Move Forward With Sharing Finances

Defining who is paying for what, what accounts exist, and whose income goes where is essential to moving forward after discovering financial infidelity. Setting a budget can help greatly here. Zero-based budgeting is helpful for people just getting started. Creating expectations for spending allows there to be a balance of power within the relationship and can reestablish trust in the other person to not put the relationship’s financial stability at risk.³

Schedule Financial Check-Ins

Having these conversations and making these plans just once will not work. Financial check-ins are necessary for accountability and trust to remain within the relationship after discovering financial infidelity. Set at least monthly meetings with each other to go over the budget, accounts, and where money is being spent.

Seek Necessary Financial Change

Sometimes, what comes from discovering financial infidelity is that the financial resources available in a relationship are insufficient or overstretched. Have an honest conversation about if the things that you are spending money on are necessary and if the income situation is sustainable for your desired lifestyle. If not, there may be a need for a change in spending, lifestyle, employment, or something else.

Can Couples Counseling Help After Financial Infidelity?

Pursuing marriage and couples counseling for financial infidelity can be beneficial. Therapy after infidelity can help navigate the aftermath by facilitating an honest conversation about how each person’s behavior has impacted the other and identifying changes that can be made for the benefit of each partner. It can also help relieve financial stress.

If you aren’t sure whether you want to split up, discernment counseling may be especially helpful. Occasionally, individual therapy will be necessary if one or both people have underlying mental health struggles or if only one person is willing to participate in therapy. Finding a therapist can sometimes be difficult, but an online therapist directory can help.

Final Thoughts

Financial infidelity can present as hiding money, being secretive about financial decisions, being guarded around talking about money, and becoming defensive when questioned about spending. Financial infidelity can occur for many reasons, including an underlying psychological or personality disorder, need for control, revenge, and many other reasons. Moving forward after financial infidelity is discovered is possible by having open and honest communication around income, spending, and financial decisions, and sometimes by getting professional help.