Get ‘Financially Naked’ with your spouse

This may not be the best way to start a conversation on a first date. I’m bankrupt.

How about – I’m a gambling addict?

Sure, you’re being honest. But is this a good way to get a second date? Not likely.

So, rather than saying either of those things, you think twice.

You pay for dinner with a debit card or cash. Your explanation is that you don’t like to use your credit card because of the interest rates or you save it for emergencies.

The real reason is you don’t have credit cards anymore. You racked them up and couldn’t make the payments.

As the months and years go by, the relationship evolves. Perhaps you get married. But you never find the right time to talk about your financial mess. And, the longer you wait, the harder it gets.

Eventually, the whole truth comes out anyway.

Credit Canada and the Financial Planning Standards recently shed some light on financial dishonesty between couples. The report, interestingly called Financial Infidelity, surveyed 1,550 Canadians between Jan. 2 and Jan. 5, found that 36 per cent of respondents admitted to this type of dishonesty.

The 36 per cent breaks down into 14 per cent racking up credit card debt without their partner knowing, nine per cent contributing less to the relationship than they should (based on their income) and eight per cent lying about their income. Other findings include seven per cent making a secret major purchase, seven per cent keeping a secret stash of money, six per cent taking off with all of the couple’s money and four per cent going bankrupt without the other person knowing.

At first glance, those numbers seem low. After all, 36 per cent is just over one-third admitting financial infidelity. Doesn’t that also work out to two-thirds of respondents being financially truthful with their spouses or partners?

Maybe the problem isn’t that bad. Perhaps you can take your hidden stash and buy your significant other some flowers. After all, Valentine’s Day is this week.

I chatted with Laurie Campbell, CEO of Credit Canada, about the findings. As she did with their Blue Monday report, she isn’t buying my attempt at half-glass-full optimism this time either.

She points out that these categories, such as keeping credit card debt or bankruptcy a secret, are problematic in and of themselves for a couple, especially if the unknowing partner is stuck with the debt. But moreover, the findings make the partner wonder what else is being kept from them.

And, some quick math also helps put things into perspective.

Six per cent of respondents saying they took off with all of the couple’s money doesn’t sound like a lot at first. But remember it’s six per cent of 1,550 people surveyed, or 93 people. That’s a lot of lives likely ruined.

So, it looks like taking some money from your secret stash and buying flowers isn’t going to solve this one.

Campbell has some advice for potential victims. If you think something might be off with your partner’s or spouse’s finances, then get educated about your own finances – do a credit report on yourself to see what is in it and, if you have a joint bank account, then find out how much is in it. Better yet, get rid of the joint bank account and get your own.

If you’re on the other end keeping financial secrets, you eventually have to come clean and get “financially naked” with your spouse or partner.

Campbell says if you don’t, then “chances are you’re not going to get naked any other way, either.”