Our relationships have a significant impact on our overall health and well-being. One of the critical, yet often overlooked, aspects of a relationship is financial transparency. You may have seen it with your parents or experienced it with your partner—money often becomes the root cause of disagreements in relationships. Today, I'd like to talk about financial infidelity.

Financial infidelity happens more often than most people realize. In Canada, financial issues, including financial infidelity, are often cited as the top reason for divorce, with 68% of marriages ending over finances or property-related problems *. This makes financial infidelity a pressing issue. When partners lie about money, it can lead to arguments, loss of trust, reduced privacy, and separation of combined finances. In some cases, financial infidelity can even be a form of financial abuse, where one partner excessively controls the finances to manipulate the other.

The Importance of Financial Transparency

Being open about money with your partner, especially before any resentments arise, is crucial for maintaining a healthy relationship. Transparent communication about finances helps prevent conflicts and builds trust. Here are some steps to foster financial transparency:

• Have an Open Discussion: Start by having an honest conversation about your finances. Discuss any past deceptive practices and come clean about all financial matters. This can be the hardest step for many couples because it requires leaving your ego at the door and placing full trust in your partner. Money has become one of the most private aspects of our lives, and coming clean about your wealth or debt can leave you feeling very vulnerable.
• Discuss Needs vs. Wants: Understand each other’s spending habits and distinguish between necessities and discretionary spending. Creating rules about how much each party can spend without consulting the other is a great start. Consider creating a structure where you serve as each other's accountability partners.
• Track Your Spending: Develop a spending plan that aligns with your shared financial goals.
• Keep Communicating: Continually discuss your finances to ensure that both partners are on the same page and feel ownership of the financial plan. Setting up some sort of a scheduled weekly or bi-weekly discussion could add structure and make sure you both wont forget to have a discussion.

How a Financial Professional Can Help

A financial professional can play an important role in helping couples navigate their financial lives. Here’s how:

• Expertise and Experience: Financial advisors bring a wealth of knowledge and experience to the table. They can provide insights into effective money management, investment strategies, and debt reduction plans tailored to your specific situation. Chances are they have also worked with couple before and may have suggestions on how to tackle your particular financial needs together.
• Objective Sounding Board: Sometimes, couples need a neutral third party to help mediate financial discussions. A financial advisor can facilitate these conversations, helping both partners feel heard and understood without judgment. It’s important here that you both feel comfortable with the financial professional. I go into more detail on that in my previous article: NAVIGATING FINANCE.
• Financial Education: Many individuals lack the financial literacy needed to manage their finances effectively. Financial advisors can educate couples on budgeting, saving, investing, and planning for the future, guiding them to make informed decisions.
• Customized Financial Plans: Every couple is unique, and so are their financial goals. Financial advisors can create customized financial plans that align with the couple’s aspirations, ensuring they work together towards shared financial success.

 

Financial infidelity is a hidden threat that can erode the foundation of a relationship. I encourage you to prioritize financial transparency and, if needed, seek the guidance of a financial professional. This can help couples build stronger, healthier relationships and improve their overall well-being.

 

 

*Top 10 Reasons for Divorce in Canada