ARE YOU HAVING A FINANCIAL AFFAIR?

The new Oxford American dictionary of English defines fidelity as “demonstrated continuing loyalty and support to a cause, belief or person.” “the degree of exactness with which something is implemented, copied, or reproduced.”

Wikipedia, the free encyclopedia defines financial infidelity as the secretive act of spending money, possessing credit and credit cards, holding secret accounts or stashes of money, borrowing money, or otherwise incurring debt unknown to one’s spouse, partner, or significant other. Adding to the monetary strain commonly associated with financial infidelity in a relationship is a subsequent loss of intimacy and trust in the relationship. Financial infidelity appears to be on the rise, with a 2005 study showing that 30% of respondents had lied about financial information and 25% had withheld information, whereas a 2008 study showed that half the respondents had committed some form of financial infidelity.

taking a leaf from the dictionary definition , I will proffer that ‘ financial success will come to those who demonstrate continuing loyalty and support to their savings and investment plans and remain committed to debt work outs ( where they apply) and maintain a degree of openness with their spouses and employers.’ Where you fail to do this, you will be guilty of financial infidelity. Personal Finances and Relationships

greg sneddon of the SA Financial planning group posits that ‘In the us, 51% of marriages end in divorce and almost 80% of couples cite “money” as the primary cause of the marital demise. the national endowment for Financial education (in the us) also found that 31% of people who combined finances have committed some type of financial deception – from hiding purchases to lying about the amount of debt they owed, with as many as 58% admitting that they hid cash from their partners.

Marriage and relationships are hard enough and few survive affairs, so why do we expose them to the additional stresses of financial infidelity? “Financial affairs” are not new and they are not limited to men only – many women are just as guilty of financial infidelity.

How often do we make financial decisions without our partner’s input, or fail to disclose the full extent of our purchases to partners? Just like a physical affair, financial infidelity seldom happens abruptly. It sneaks into a relationship through those little lies and seemingly harmless secrets that we keep about money.

Just like sexual infidelity starts with an innocent business lunch or a little flirtation over coffee, financial infidelity begins with that first secret, that first half truth, that first hidden purchase.

Financial infidelity manifests itself in some of these ways:

• When you get a private credit card and convince yourself you will only charge n10,000.00 a month. But then it becomes n50,000 and then n100,000, and the spiral just keeps swirling down.

• When a woman tells her partner she spent n500 at the mall instead of the N20,000 she really spent because she doesn’t want him to get mad at her.

• When you hide the real depth of the debt you are bringing into the relationship.

• When two people maintain separate accounts because they don’t trust each other enough to pool their resources.

• It is what happens every time a person lies, cheats, or deceives his partner about money. Overspending, separation, lack of planning, control, and secrets – these forms of financial betrayal can be just as damaging to the relationship as sexual betrayal.

Can you detect financial infidelity?

Financial infidelity can be detected with these three major signs:

•Your spouse refuses to have honest, open discussions about money: is often defensive and the discussions invariably degenerate into an argument

•Your spouse handles ALL financial transactions in the family and refuses to let you see invoices, receipts or quotations. Bank statements and investment letters are a no go area.

•One of you is living way beyond the declared income of the family

How to overcome Financial Infidelity

Be HONEST And Open ABOUT Financial TRANSACTIONS

the first step is to come completely clean with all previously hidden financial transactions. Both people in the relationship should be very honest about all of their financial mistakes in the past, so that you know what you are working with and can begin to truly repair the damage done. this means bringing out every credit card, jewellery, land purchase and every loan you have as well as any other financial pieces of information you may have hidden in the past.

COMMIT TO CHANGE

Both parties need to commit to work through this together. the problem will not be fixed overnight and the person who hid things should not be expected to adjust quickly and be ready and eager to fix the problem. On the contrary, expect deep resistance and denial and possible increased attempts to hide more in the short term.

PROBE FOR ROOT CAUSES And OFFER REMEDIES

the reasons for the financial infidelity should be looked at and addressed. For example if one spouse is a compulsive shopper, he/she should not have a credit card with a large withdrawal limit or be allowed to manage the family spending ( that’s like leaving a cat with a bowl of milk…)

IMPLEMENT A CHANGE In DAILY HABITS

restrict online shopping, pay on delivery and window shopping trips. tell your friends you are on a shopping fast, fast food fast, eating out fast, drinking fast (yes a fast) and keep away from anything and anyone who will encourage you to spend money outside your budget.

Budget

the next step is putting together a new budget and a plan to clear up the debt. this needs to be done as a team. Access to all of the accounts need to be given to both spouses so that each spouse can check on balances and make payments on the debt. You may need to bring in extra income to clear up the debts. this may require selling items, or getting a part-time job in addition to your regular job. the more money you can find to throw at the debts the more quickly they will be cleared up.

REVIEW REGULARLY

Meeting or discussing regularly about the budget and financial situation are essential to get the relationship and finances back on track. the meetings should cover the money spent since the last meeting on all accounts and should consider what categories in the budget have reached the spending limit, and review the balance in all of the accounts.

no matter the financial mistakes we have made, no position is totally without remedy or insurmountable. With the right attitude, willingness to be honest and open, and discipline, financial Infidelity can be overcome.

written with excerpts from Financial Planning Group SA website and investopaedia.com.