According to news reports, “secret spending” has played a role in at least ten percent of all divorces in the United States in the last ten years. In a recent poll, more than 70 percent of spouses who spent money without their partner’s knowledge admitted they hid the spending because the partner would be angry or upset.
At least half of the people surveyed who admitted to secret spending confessed to “frivolous” spending, but the same number of individuals claimed that the spending was on necessary purchases. Women were more likely, at 60 percent, to hide a credit card statement, but men spent more on average than their female counterparts.
Since a recent Kansas State University study found that arguing about money was the top predictor of divorce, and a National Endowment for Financial Education study found that at least 16 percent of marriages end due to “financial infidelity,” spending habits and patterns are of great concern to both partners. Unfortunately, one partner’s “financial infidelity” may directly impact the other’s credit rating, ability to handle debt, and overall financial health.
What is “Financial Infidelity?”
Many spouses are shocked to learn how effectively the other spouse can cover up spending during a marriage. All it takes is an internet connection and one spouse can be off spending large amounts of money without the other spouse’s knowledge or consent.
This is because things have changed in terms of how credit is given out. In the past, a couple almost always carried all credit cards jointly or at least had both names on a credit card account, even if only one was responsible for repayment. In the past, couples also tended to pay cash for items rather than charge them.
That has all changed now that credit has become more easily available. Financial infidelity is easy to engage in when one partner can go online, open a credit card or charge account and have the bills sent directly to a private inbox. In fact, many partners do not discover financial infidelity until the time comes to divorce and the spouse attempts to list this spending as “marital liabilities” or debt of the marriage.
Do I Have to Pay This?
Whether or not you are required to pay for a partner’s spending depends on several factors. A family law attorney can help you understand both your rights and your obligations under California law.