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| The Basics | Money secrets and why we keep them
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Were all hiding a little something -- you, me, the ones we love. We usually prefer to live and let live, but not knowing is the worst mistake you can make.
By MP Dunleavey
I was shocked (shocked!). In an MSN Money reader poll, two-thirds of the respondents admitted keeping some kind of money secret from their mates.
Sure, 35% said these secrets were "nothing of consequence," but fully 31% admitted to withholding more substantial information, including 6% who keep "virtually everything" about money secret from their partners.
Alas, my outrage was cut short by a little tickling feeling on the edge of my brain, the flailing of my conscience as it tried to spit out the gag I'd stuffed in its mouth.
It's not that I've lied, exactly. Let's just say I'm guilty of the sin of less-than-full disclosure on the financial front. (Did I just admit that to a million people?)
Now, at least, I know that I'm not the only woman on the planet who has fudged the true nature of her credit card debt to her partner.
The shop-dont-tell policy
Mari Adam, a financial planner in Boca Raton, Fla., estimates that the secrets most couples keep are "pretty transparent," she says. "The No. 1 secret is probably shopping."
Based on the extensive data I collected from everyone who would return my calls, I have to agree. One woman -- let's call her Alice -- promised her fianc that she would get rid of her mountain of credit card debt once they married. She kept her promise and whittled it away, until a career change forced her to lean on her husband for more financial support -- which he was more than happy to give.
"The trouble was that his idea of support had nothing to do with my day-to-day reality," Alice says. Because he was the saver in their marriage and she the spender, his concept of how much she needed to support herself in the style to which she had never really admitted didn't add up. Rather than upset him by asking for more money (or admit her penchant for designer togs), Alice slid into debt again.
"I feel like I'm turning into my mother," she says ruefully. "This was her pattern with money and men."
Violet Woodhouse, a family law specialist and financial planner in Newport Beach, Calif., agrees that these money habits have their roots in how we were raised, particularly for women.
"Even these days," the author of "Divorce and Money" says, "I don't see many women being active and equal financial partners in their relationships, no matter how much they make or how professional they are," says Woodhouse. "There is a deferral that goes on to the men in their lives. I think women suffer from the misperception that if they discuss money openly, or take charge, they'll be seen as a gold digger."
Which hardly means that sneaky spending is a gender issue. Men are just as likely as women to have their secret retail indulgences. "My husband is in a uBid.com phase," said a mother of two. "He just bought a barbecue, a flat-screen TV and a DVD thing so the kids can watch movies in the car. I'm at the point where I just don't want to know."
But not knowing is the worst mistake you can make.
Turn a blind eye, pay a big price
Keeping a secret is a little bit like doing the tango: It takes two. One person might actively hide his debt or gambling habits, bonus or inheritance or stock market trades, but his mate might be just as actively be not looking, not asking, not reading the bank statements, not doing the math.
Woodhouse worked with one couple where the husband discovered his wife's $35,000 debt burden when his employer garnisheed his wages. He was the full-time earner. She had a part-time job and a full-time fetish for buying more than she could afford, so she used his income and employment info to qualify for one of her many credit cards. Woodhouse faults the wife for letting her lust for stuff (The hidden costs of too much stuff) spin out of control, and she blames the husband for not paying attention. "She spent $35,000 on a ton of stuff -- things for the house, gifts. How could he not notice?"
In part, this is an issue of communication, but it's also about power. "People hide things because they don't want to be accountable, they don't feel they are accountable, they don't want to be judged and they don't want to be criticized," Woodhouse says. "It's ultimately about control."
Alice says that in her case, being able to add a little Prada to her life without cluing in her husband is more about privacy. "I feel entitled to do what I want with my money, without being questioned," she says. "It's about autonomy."
Woodhouse believes you can have your privacy and your Prada and not compromise your marriage, but that requires communication. "The reason people hide things in order to gain control is because they haven't made agreements with their partner," says Woodhouse. Even a die-hard saver married to a spender can work out a middle ground where they each get what they want.
Mari Adam, the financial planner, advocates setting a certain ceiling. "You decide that you can each spend up to, say, $500 a month without disclosure. Anything over that requires a discussion," she suggests.
Is your partner hiding something?
I spoke to Terry, who is living with a graduate student named Frank. Terry and Frank are planning to get engaged, and though they're both naturally reticent about money ("I come from a family where it's considered bad taste to talk about these things," she says), she trusts that he's not hiding anything.
His parents are well off and pay his tuition, plus a small stipend for his living expenses until he finishes his Ph.D. After they're married, Terry says, she'll feel entitled to know more. "But only what I need to know: his salary, his retirement and how we plan to pay for the kids' education. Things that have to do with our partnership."
Woodhouse argues that everything has to do with their partnership, and Terry would be foolish to wait until they're married to inquire about it. "How does she know the money from his parents isn't a loan?" Woodhouse points out. "How does she know it doesn't come with some obligation, whether financial or moral? How will she protect herself if she doesn't ask?"
Unfortunately, this is the problem with money secrets, says Anita Katz, Ph.D., a psychotherapist in New York who has conducted workshops on emotions and money. "Freud said the two hardest things to talk about are money and sex, but these days I'd say money is a lot harder."
So often the way we play with money, and the reasons we deceive, have to do with fantasies we want to create, an image of ourselves we're trying to maintain. Katz worked with one couple who reached a crisis when she found out that he'd been taking out small business loans to float their household expenses. He owned his own business, which was failing, but he couldn't admit to his wife, or to himself, that he couldn't afford his half of their financial arrangement. So he went tens of thousands of dollars into debt to keep up appearances and ultimately lost his marriage.
A little conflict can keep the peace
When couples start hiding things, or stop communicating (or never communicated about money to begin with), experts say there's something else they're concealing: a fear of conflict.
Katz worked with another couple who struggled over the wife's inheritance. "She made it clear that this wasn't going to be part of the communal pot," Katz says. "This was her security."
The husband was upset, but at least he knew exactly what was going on. "People have to risk doing what their spouse will be unhappy about," Katz says. "If there's a fear of making your partner unhappy, my hunch is that it's not just about money. I think a good relationship can only deepen and grow if you're not afraid of conflict."
A friend of mine, who received a windfall recently through a business deal, had that revelation herself. She told me that she had briefly schemed to squirrel the money away in an account -- and not tell her husband. "But I'd feel as if I were having an affair," she says. "To me, the issue becomes, 'Why? In case you feel like leaving him?' And if so, maybe you should be talking about that, not hiding the cash. So keeping a big secret seems very symbolic to me of negative things."
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