In every relationship, communication is key. But all too often, couples are not open with each other about their finances. Then there’s the fact that each partner enters a relationship with differing levels of financial capabilities and knowledge.<\/p>\n
Advisors can help uncover these differences by encouraging both partners to engage in open communication during the financial planning process.<\/p>\n
Here we’ll take a closer look at how financial infidelity and differing\u00a0money experiences<\/a>\u00a0can impact a relationship.<\/p>\n Research suggests that financial infidelity is common, with some studies estimating that 27 percent of couples have committed acts of financial infidelity; others put the number closer to 70 percent.1<\/sup><\/p>\n This type of infidelity can show up in decidedly different ways. According to experts, many of these acts are harmless and not intended to be malicious.2<\/sup>\u00a0However, acts of financial infidelity can be deceitful, designed to cover up wrongdoing or avoid conflict. Of course, acts of deception can be more damaging.<\/p>\n A lack of financial transparency in marriage<\/a> not only undermines the trust in a relationship. It also lessens the opportunity to achieve the deeper level of intimacy that can result from discussing financial decisions<\/a>\u00a0and priorities, according to therapist Michelle Jeanfreau.<\/p>\n Conversations about money can be emotional. They evoke within us a range of feelings, from vulnerability and shame to power and financial satisfaction. While these conversations may be difficult, they should not be avoided. This is especially true for couples who share living expenses.<\/p>\n Many understand the importance of open financial communication to improve how we manage money. However, very few of us are formally taught how to navigate this complex topic.<\/p>\n It’s more likely that we will learn about finances through observing our family members and friends, as well as our own trial and error. These observed learnings are known as implicit financial socialization.<\/p>\n While researchers say parents are the primary socializing agent when we are children, socialization is not limited to childhood. It’s a lifelong process. We constantly examine, and in some cases refine, our views and values related to money.<\/p>\n For example, we likely place a different value on money at age 22 versus 42. Our experiences and acquired knowledge help inform our financial management, skills, and capabilities.<\/p>\n It’s important to understand that financial socialization is an individual experience. \u201cWhen partners are joining into a committed relationship, they are each bringing in their own relationship to money, as well as their own interpersonal communication skills, that have been influenced by their personal socialization process.”3<\/sup><\/p>\n The influences that may be carried forward from childhood create what can be perceived as \u201cnormative expectancies.” For example, one partner might come from a family that was open about money, while the other was raised to believe finances should be private. Each one brings distinct views of what is \u201cnormal.”<\/p>\n For many people, a financial advisor’s office may be the only place they know to seek out financial support. As an advisor, it’s important to define your scope of service and understand your own level of comfort in helping couples navigate these difficult conversations. Should clients\u00a0require services beyond your scope, consider referring them to a\u00a0more specialized\u00a0professional such as a\u00a0Certified Financial Therapist or Accredited Financial Counselor.\u200b<\/p>\n To learn more about helping couples who have financial communication issues, watch the webinar embedded below. Experts Meghaan Lurtz, Ph.D., FBS\u2122, and Megan McCoy, Ph.D., LMFT, AFC\u00ae, CFT-I\u2122, join me to discuss financial management considerations for both partners.<\/p>\nTackling Financial Infidelity<\/h2>\n
Examining Financial Socialization<\/h2>\n
Evolving Money Values<\/h2>\n
Applying These Insights<\/h2>\n
Gaining a Fresh Perspective<\/h2>\n