Financial Infidelity is a Real Thing

Episode 320 – Financial infidelity is a real thing. And the problem may be worse than most people realize. Two new surveys provide us with some fascinating details.

More SML Planning Minute Podcast Episodes





Transcript of Podcast Episode 320

Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, how many people are keeping financial secrets from their family?

The number may surprise you. According to a Bankrate survey, 40 percent of couples—defined as either married, in a civil partnership or living with a romantic partner—have committed what they refer to as “financial infidelity against their current partner.”[1] Hiding financial actions or decisions from a partner, keeping secret accounts, spending without a partner’s knowledge, or concealing debt from a partner all characterize financial infidelity. Financial infidelity can wound relationships and damage trust. The Bankrate survey indicates that nearly half of the survey respondents in committed relationships (45 percent) believe financial infidelity is as bad as physical infidelity.

Some of Bankrate’s other interesting findings:[2]

• 
  
• Most American couples maintain at least some separate accounts. In fact, 27 percent keep all their money in separate accounts. Only 38 percent keep all their money in joint accounts. The remaining people have a mix between the two.
  
• The most common financial secret is overspending. In other words, one spouse has previously spent, or is currently spending, more money than the other spouse would approve of if they knew about it.
  
• Some have secret debts. Among those surveyed, 23 percent either had, or currently have, a debt that their partner doesn’t even know about.
  
• Secrecy can apply to assets as well as debts. 15 percent of respondents say that they have a savings account that their partner doesn’t know about. 13 percent have a secret checking account.
  
• There is a generational element as well. Younger people are more likely to keep financial secrets. According to the study, 67 percent of Gen Z respondents are keeping these types of secrets. The percentage goes down with each generation, reaching 30 percent for baby boomers.
  

It’s important to note that there’s a difference between secret and separate accounts. Having a separate account might make sense in some circumstances. For example, having a separate account may give you or your spouse a feeling of independence, or it may make your bookkeeping easier. The difference is that these accounts are generally the type in which the other spouse still has full access. So, it’s more difficult to classify separate accounts as “financial infidelity.”

Not all family secrets are between spouses. According to another study, this one by Fidelity, less than half of parents discuss money with their adult children.[3] 56 percent of respondents to this survey said their parents never talked with them about money, even though 81 percent believe they would have been helped by getting more financial education at a younger age.[4]

And what lessons can people learn by talking about money with their parents? According to the study, only 11 percent of Americans consider themselves to be wealthy. But among those who do, they recommend investing strategically (in other words, aligning your asset allocation to your time horizon), starting at a young age, and making sure that you consistently allocate part of your paycheck to savings.[5]

Fidelity concludes by suggesting that people need to become more comfortable talking about their family finances.[6] That would be a good starting point.

[1] Kelton, Katie. “Survey: 2 in 5 Americans in a relationship have kept a financial secret from their partner.” Bankrate.com. https://www.bankrate.com/credit-cards/news/financial-infidelity-survey/ (accessed Jan. 31, 2025).

[2] Id

[3]  Fidelity Investments® Research. “Americans Ready to Break the Cycle of Avoiding Family Discussions on Once Taboo Financial Topics.” Fidelity.com. https://newsroom.fidelity.com/pressreleases/fidelity-investments–research–americans-ready-to-break-the-cycle-of-avoiding-family-discussions-on/s/82ad8bf6-548c-4df9-8a6f-d5ec1734439a (accessed Jan. 31, 2025).

[4] Id

[5] Id

[6] Id

More SML Planning Minute Podcast Episodes

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares^®.  The content provided is intended for educational and informational purposes only.  Information is provided in good faith.  However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information. 

The information presented is designed to provide general information regarding the subject matter covered.  It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation

To help reach your goals, you need a skilled professional by your side.  Contact your local Security Mutual life insurance advisor today.  As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives.  For more information, visit us at SMLNY.com/SMLPodcast.  If you’ve enjoyed this podcast, tell your friends about it.  And be sure to give us a five-star review.  And check us out on LinkedIn, YouTube and X (formally Twitter).  Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances.  Results may vary, and products and services discussed may not appropriate for all situations.  Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently.  We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances.  Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York.  Product availability and features may vary by state. 

SubscribeApple PodcastsSpotifyAndroidPandoraBlubrryby EmailTuneInDeezerRSSMore Subscribe Options