Many people have debts they are keeping secret from their partners, research commissioned for the start of Money Week shows.
Te Ara Ahunga Ora The Retirement Commission surveyed the public and found that 12% of people who had debt, and who were living with their partners, were keeping at least some of their debts secret.
Another 35% admitted their partners might be a bit hazy on exactly how big their debts were.
The results don’t shock financial fitness coach Lynda Moore, who is studying to become a financial therapist, as she says “financial infidelity” is rife among couples.
Financial infidelity is a term that covers people making financial decisions, and then keeping them secret from their partners.
Amassing secret debts is only one form of financial infidelity, she says.
Had the commission asked people whether they had secret savings and secret bank accounts, they would have found they were common too, she says.
A survey by Te Ara Ahunga Ora The Retirement Commission for Money Week 2022 reveals what families have had to do to cope with the rising cost of living.
“Quite often it’s done because of differing money personalities,” Moore says.
“Some people just want to have money tucked away because they don’t want their spender partner to get at it,” she says.
Other reasons for financial infidelity can be wide-ranging, including gambling addictions, she says, and even people in blended families secretly providing support to their former spouses and children without telling their new partners.
But debt is the big one, and when it is discovered it could feel to the betrayed partner as bad as sexual infidelity, Moore says.
Tom Hartmann, managing editor of the commission’s Sorted website, says debt can be tied up a sense of shame and guilt.
He says in German, the word for debt and guilt is the same: Schuld.
“We are not always proud of some of the decisions we have taken,” he says.
He says that rather than actively keeping their debts secret, some people just don’t talk about them.
“There is a distinction between silence and active cover-ups,” he says.
People aged 18-24 who describe themselves as having a partner, for example, did not discuss their debts with their partner, the commission’s researchers found.
Keeping debt secret was more common among men than women, the commission found, and older couples were more likely to be completely open about money than younger ones.
Some couples do struggle to talk about money, the commission’s research suggests, with 37% of people saying they and their partners’ financial goal-setting was either entirely absent, or minimal.
Hartmann says that can be a function of individuals having different attitudes and ambitions for their money lives.
The commission’s research also indicates couples have different ways of managing their money lives, which may be contributing to less-than-fully frank conversations.
The commission found that 45% of couples ran completely joint finances, while 41% combined some, but not all aspects of their money lives, while 14% ran separate finances.
Some level of financial autonomy in relationships can have value for couples, Hartmann says.
“We know that for a successful relationship you need good communication, but also need a dose of autonomy,” he says.
There is an increasing amount of guidance on how to have effective money conversations tailored for New Zealand households.
Earlier this year, the charity Good Shepherd released its Healthy Financial Relationships toolkit, which aims to teach couples how to avoid sabotaging their money conversations.
“What the toolkit does … is to upskill all New Zealanders to talk constructively and respectfully about money with each other,” said AUT senior lecturer Ayesha Scott at an online event to launch the toolkit in July.
She hoped that would help households avoid some of the stresses and problems that could arise when families were unable to talk about money.
The toolkit also describes what a healthy financial relationship looks like.
Sorted has also published guides to better financial communication, including how to cope with negative reactions from your partner.