Financial Infidelity: Knowing the Risks and Finding the Remedy

Written by: Taylor J Kovar, CFP

Money conversations come easy to us financial advisors and wealth managers. We know the subject matter and are well past any feelings about finance being off-limits or taboo.

For the average person though, that’s not always the case. Everyone has a unique journey with money that likely includes some rough patches. How a client learns to cope with those difficult times informs how they’ll react in the future when money questions arise.

An advisor, for better or worse, doesn’t just deal in dollars and cents. Personalities and relationships influence how you can or can’t help a particular person—and this is especially true when dealing with couples. Individuals have primary and secondary Money Personalities. A husband might be a Spender/Risk Taker while his wife is a Saver/Security Seeker. That means every couple has four attitudes about how and when and where to spend their cash, and the different approaches almost always lead to a little bit of conflict.

Funny enough, conflict is the good part. The debate and compromise lead to better decisions and stronger teams. The real danger lies in the unknown; the secretive and shameful spending that one or both parties hope to keep hidden until it somehow goes away.

That’s what a financial advisor needs to mine for, uncover, and dispose of. A couple can do great things with their money when they work together and are honest with each other. If there are too many skeletons in their respective closets, the relationship—between spouses and with you as their advisor— is headed for an implosion.

The Financial Infidelity Spiral

It almost always starts with an innocuous purchase or plan, something harmless that doesn’t need to be mentioned. Whether it's a small purchase like a coffee on the way to work or a bigger loss like an investment gone south, the impulse to hide and deceive is common and understandable. I can fix this. I won’t mention it now and it won’t be a problem later.

Spoiler: it’s going to be a problem later.

The problem will fester and grow and get worse the longer it goes on. It’s like a gambler chasing their bet, losing more and more money in hopes of winning back what’s already lost. The lying, and the spending, can snowball until there’s no way to hide the truth and things become really, truly dire. Because financial infidelity can start so casually, and because it has the potential to spiral out of control, financial advisors need to be on the lookout for the signs.

1. Secret Accounts

Whether couples have shared finances or not, an undisclosed card is always a possibility and always a problem. A client might claim it’s just a Target rewards card and therefore not a big deal, but the fact that one spouse doesn’t want the other to have access makes it a big deal. If a husband or wife is worried about the other seeing what they’re spending, financial infidelity is at play.

2. Unaccounted Cash

Electronic payments leave a paper trail, while paper money allows for more clandestine spending. If one person always wants to have cash on hand but doesn’t have a clear explanation as to why, you can deduce that they want to spend without being monitored. The sneaky spending might start innocently— needing cash for parking or for a toll—before the spender in question gets hooked on the freedom of having money their spouse can’t track.

3. Fairness Obsession

Financial infidelity isn’t always about the thing bought or the amount spent. The crux of this issue is distrust and secrecy. If a husband is pouring over the receipt from a wife’s trip to the grocery store before announcing he’s off to buy new golf clubs to “even the score,” that’s some five-alarm infidelity. Couples who are always trying to carve out their half of the family funds are primed for lies, deceit, and fighting.

Infidelity Fixes

Every once in a while, the problem goes away quickly. A spouse stops spending on the undisclosed Visa, the couple makes amends, and life goes on.

Unfortunately, that’s usually the exception to the rule. More often, people have to overcome the hurt and betrayal before they can move forward. The person responsible for the infidelity has to come to terms with the choices they made and seek out the root causes. When everything is laid bare, the couple has to decide how they get back on track and rebuild their trust.

All of this turns you into a financial therapist as well as an advisor. You might not be able to delve into the psyche of each client, but you can help them make sense of their money decisions and Money Personalities. Did they grow up without much and now squirrel money away out of an abundance of caution, even hiding it from their spouse? Do they not trust their partner with investments and therefore decide to take the burden of risk on themselves?

If you don’t feel equipped to navigate this type of money conflict, you’re not alone. This can be the hardest part of the job and often goes ignored by advisors who see this stuff as above their pay grade. Despite those feelings, you can help struggling couples with a tactical approach.

1. Do an Assessment

Some couples think they have no problems. Everyone is spending money and it’s going great. Others will pretend things are fine while hoping no one asks about some mysterious credit card bills that get paid every month. Whether things seem fine or are obviously in disrepair, make each party take the quiz at to see how honest they’re really being—with their spouse and with themselves. A quick test can be very revealing.

2. Connect Success to Transparency

The bulk of your work is helping people make their dreams come true. The retirement, the houses, the vacations—everything your clients want for their future can be wiped away if spending secrets are allowed to fester. When a person comes clean and vows to change, financial infidelity can be overcome. When the lies carry on unseen and unaddressed, disaster eventually strikes.

3. Defend the Defensive

Tensions are almost bound to flare when you delve into money issues that no one wants to talk about. When one party feels backed into a corner, be sure to validate their feelings. Create a trusting environment where clients can divulge things that are hard to discuss. Let people speak, be heard, and respond. When someone feels seen, they're more likely to stop being overly defensive and take a moment for self-reflection.

It would be great if the job was just dollar signs and decimal points, but we all know it’s more than that. Learn to spot the signs of financial infidelity and then have the tools ready to help your clients overcome it. When you help a struggling couple work through these money battles, it helps not just their relationship, but also strengthens your relationship with them. From your firm to their family, everyone wins when you weed out the infidelity.

To get more information about Money Personalities and what causes certain financial behaviors, visit and have your clients take the free personality assessment.