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Updated on Thursday, February 14, 2019
Even partners in the healthiest relationships may question whether or not to keep a financial account or evidence of poor financial habits a secret from their significant other. Money can be a sensitive subject to discuss, and some people find the temptation to keep a secret bank account irresistible when the alternative means an honest talk about a loved one’s spending or saving habits. But for anyone thinking of taking a covert trip to the bank, you first need to think long and hard about why you want to set up a hidden bank account, and whether your situation warrants all of the hassle that comes with keeping secret finances.
How common are secret bank accounts?
It’s difficult to pin down exactly how many Americans are harboring secret bank accounts from their spouses, but it’s more common than you probably think. A 2016 survey of newlyweds by credit reporting agency Experian revealed 16% of those who just tied the knot hide a financial account from their partner, and 31% of people who combined finances with a significant other have lied to their partner about finances, according to a poll from The National Endowment for Financial Education.
Similar to a romantic affair, the reasons for a person lying about a secret bank account can vary, but one common factor is an atmosphere of discomfort around discussing finances and a fear of being judged poorly by their partner.
“It’s such a taboo subject to talk about,” said Dr. Maggie Baker, psychologist and financial therapist practicing in the Philadelphia area and author of the book Crazy About Money.
When people with incompatible spending and saving habits intertwine their lives, one half of the couple—usually the one who likes to spend—may find it easier to squirrel away some cash in a hidden checking account, where it can be used to indulge splurges away from the prying eyes of their more frugal partner.
The other noteworthy reason spouses hide money from another partner involves not spending, but saving. Broadly speaking, spouses who find themselves financially dependent on their partner may want to maintain a sense of independence by having money in an account under their own name, but don’t feel comfortable enough to do so out in the open.
Reasons you want to keep an account secret, not just separate
Having a separate account of your own money in a marriage doesn’t have to be a clandestine operation. A TD Bank survey found that 42% of couples who were either married or cohabiting also maintained a separate bank account, despite having joint accounts with their partner. And you retain sole ownership of a separate account despite your marital status—your spouse just can’t walk into your bank and demand access or information about your account just because you put a ring on it. But given the amount of people hiding secret bank accounts from their spouse, there are certain situations where it’s tempting to keep an undisclosed stash of cash.
You’re embarrassed of your spending. Nearly half of married people (47%) say they and their partner don’t share the same spending habits, according to a survey conducted by SunTrust Bank. To avoid arguments over whether it’s worth spending more than $1,000 from the joint checking account for a new iPhone, it may be easier for you to set up your own separate account to use for those “must-have” purchases. This doesn’t need to be a secret, but the mere existence of an account created for the sole purpose of what your spouse considers frivolous spending might prompt you to keep it a secret.
You want to keep your financial independence without feeling pressure. Millennials are more likely than previous generations to keep finances separate after walking down the aisle, pointing to a trend of greater financial independence for members of married couples. Maintaining a source of funds in your own name doesn’t have to be a secret, but if your spouse knows about it, he or she may lean on you to dip into it during tough times. If you’re uncomfortable saying “no,” you may want to avoid disclosing the existence of these accounts in the first place.
Your spouse can’t be trusted with money. A more serious version of the scenario above is where you spouse has an out-of-control spending problem (like a gambling addiction) and, in addition to clearing out any joint accounts you share, will demand you give up your own money to fuel their reckless habits. A spouse displaying abusive or threatening behavior is one of the few situations where you’re completely justified in keeping any accounts in your own name secret in order to protect yourself.
You see divorce on the horizon. If your marriage is starting to look like a dress rehearsal of Who’s Afraid of Virginia Woolf? it may behoove you to start setting aside some money in your own name to prepare for a separation. Depending on the nature of the divorce and your own financial circumstances, you may need to save a large enough amount to cover not only legal fees, but also living without the income your partner earned. While you don’t have to keep this a secret, alerting your spouse you’ve begun to build a war chest could cause him or her to start making things difficult for you, such as clearing out joint accounts upon which you rely.
You’re planning an elaborate surprise. A favorable situation for keeping a secret bank account from your spouse is that you need to make purchases for a surprise vacation and don’t want the risk of your other half seeing the statements on your joint accounts.
Is the secret worth it?
All in all, most reasons you could think of for keeping a secret bank account from your spouse could be just as easily solved with a separate, non-secret bank account. While this means you and your partner will need to have a frank discussion about finances, more honesty almost always benefits the relationship (unless you’re being asked “do I look fat in this” or “am I going bald?”). By being upfront now and avoiding financial infidelity, you’ll save yourself a ton of stress and maybe even strengthen your bond with the person you love.