If you’ve been probing your partner about where all their money goes, or hoping they don’t ask you the same question, secret spending habits could be the reason.
According to research, released earlier this year, nearly a third of those in relationships spend money they don’t tell their other half about.1
Who’s spending what?
The study, which compiled responses from more than 2,000 Australians, found2:
- the majority (69%) of those in a relationship have not hidden purchases from their partner, while the rest (31%) admitted to keeping some transactions concealed
- more men (33%) said they fibbed about spending, compared to 30% of women
- fashion and beauty items, gambling and pleasure foods topped the list for secret purchases
- alcohol and cigarettes were also identified as common expenses people kept under wraps
- women were six times as likely to hide clothing and beauty purchases than men, while men were four times as likely to hide gambling transactions than women.
Is secret spending ok?
Bessie Hassan, Money Expert at Finder, said on the back of the research that the decision to keep spending a secret from your partner depended on the nature of the relationship and for those who hadn’t been together long, it could make sense to keep certain transactions private.3
Meanwhile, for those who were in a long-term relationship and trusted their partner completely, opening a joint account was an option as it meant couples would pay fewer account-keeping fees and could work towards shared financial goals.4
How many couples have joint accounts?
While many prefer to keep their finances separate—whether they indulge in secret spending or not—around one in five couples have a shared savings account, and one in four, a joint credit card.5
Despite the potential benefits, such as paying fees on one rather than two accounts and repayments possibly being easier to manage, there are still pros and cons worth weighing up.
For instance, if your partner racks up a large debt on your joint credit card, you’re both responsible for paying it back. And, if they default, it will affect their credit rating as well as yours.
The consequences of financial infidelity
A survey by Relationships Australia highlighted that financial stress was one of the key negative influences on a couple’s relationship, with disagreements about money a major cause of divorce.6
About 85% of respondents indicated that financial problems were likely to push couples apart7, which was why openness, honesty, and planning together played a big part.
How you can work effectively as a team
With the average household debt in Australia sitting at around $245,0008, if considerable money is going unaccounted for, it might be time to come clean and devise a plan that works for both of you.
To ensure you and your partner’s current and future goals are being considered, there are a few things worth discussing up front and on a regular basis. This might include things like:
- your views on money management
- secret spending habits if you have any
- your financial situation—income, expenses, assets and debts
- your credit history, as this could impact your borrowing potential
- your individual and shared financial goals—travel, marriage, children, property
- what a workable budget and savings plan might look like
- how you’ll contribute/divide repayments and bills – 50/50 or proportionate to income
- your contingency plan if one of you is unable to work at some point in the future.
Where to go for assistance
If you want help creating a workable budget, try our online budget planner calculator.
If you want to track your spending, check out the Money Manager function inside My AMP.
To take the hard work out of managing your money, check out the AMP Bett3r Account.
For further information, speak to your adviser and if you don’t have one, call us on 131 267.
1 – 4 https://www.finder.com.au/press-release-jun-2017-one-in-three-aussies-spend-secretly
6 - 7 http://www.relationships.org.au/what-we-do/research/online-survey/august-2015-impact-of-financial-problems-on-relationships