Money Liars
Posted by Gail | Filed under Money & Family, Relationships, talking about money
Have you ever told a lie about money… exaggerated how much you make, minimized how much you’ve spent on an item… overstated how much you saved because you’re such a smart shopper? If you watch House, you know the good doctor thinks everybody lies. Do you?
Surveys have been done about people’s propensity to lie, and almost a third of adults 25 to 55 say they’ve been dishonest with their mates about their money. People hide money from their partners. People keep bills hidden. People buy stuff and tell their partners they paid far less than they did. Or they keep the stuff hidden until they can incorporate it into their lives without questions being asked.
Would you ever lie to your spouse about your spending? Are there financial facts you keep hidden from your darling? Have you bought a new dress, a new pair of shoes, a new Ip Od stashed it away where your Sweetums couldn’t see it?
Women are most likely to hide clothes and food. Hmmm. Men hide their entertainment and electronics. No surprise there. And almost 40% of people have an account somewhere that their partner knows nuthin’ about.
So this is the person you’ve chose to share your life with? This is the dude or dame you’re going to count on through thick and thin? This is the pal you promised to love and honour. Ooops.
I think what we have here is a failure to communicate. What are we so afraid of, that we’d lie to our significant others, our family, our friends? How sure are we that what we’re doing is wrong? And why aren’t we listening to our little voices. After all, if we believe we must lie, it’s got to be because we know what we’re doing won’t be met with smiles and kisses. So maybe we shouldn’t be doing it.
I often counsel couples that are marrying to sit down and do a complete disclosure of their finances, coming clean on everything from the mistakes they’ve made, to what they want in the future. But what if you’re already in a relationship, how do you even raise the issue, get your buddy to pay attention, get your significant other to fess up? And how do you tell your mate that while you’ve been in charge of the money, some not-so-good stuff has been happening?
If you’re the one hearing a money secret for the first time, how would you respond? Think about it. Your partner comes to you and says, “Honey, I’ve been meaning to tell you, I applied for this line of credit a while ago and we’re $25,000 in debt!” What would you say?
All these secrets probably wouldn’t be such a big issue if we could wrap our heads around the concept that money – and what we buy – does not define us, and we don’t have to pretend to be something we’re not. As long as we are faking it, as long as we aren’t telling the truth about how we’re doing financially, we can continue to live in a world where fooling the other guy is the name of the game. Or is it a case of fooling ourselves?
Can you imagine if we had to wear T-shirts that disclosed how much we made and how much we owed on the back! Or cars with license plates that showed the accruing interest on our debt? Sure would make you think twice before you did something stupid with your money, wouldn’t it? Maybe it’s that lack of accountability that’s got us into such a mess.
No one has really come up with a solution for what the media has nicknamed “financial infidelity.” The reason is simple. Communicating about money isn’t easy. It may sound super-simple to say “learn to communicate” if you’re having financial conflicts, but knowing and doing are completely different things.
Fact is, we measure our selves by financial standards that we shouldn’t. People who drive nice cars are better than people who drive rust-buckets. People who live in chic neighbourhoods are better than people who homes (or rent) less prestigious digs. People who carry platinum credit cards have more oomph than people who walk around with cash.
When I was looking for my current home, I had very specific parameters with which to work. The house had to be close enough to school so Alex could get to and from without me on the days I had to work away from home. The house had to be able to incorporate a large home office. And it had to be bright and sunny. When I started looking “south of the tracks”, some eyebrows were raised. “You don’t want to live down there.” Well, I did. I found the perfect house in a lovely neighbourhood and I bought.
When are we going to get over the crap that we choose to use to differentiate “us” from “them”? Did you ever read Dr. Seuss’s The Sneeches. If you haven’t, you should. And you should read it to your kids. Then you should promise yourself that you’re not going to lie about your money anymore because it’s just dumb!
Can’t imagine coming clean with your partner, never mind family and friends? Think that as long as you maintain the right image, you’ve got an upper hand?
At least be honest with yourself: How’s the lying working for you?
February 3, 2009 at 8:18 am
Your comment about rust buckets and smaller homes reminded me of the book “the millionaire next door”.
For those who aren’t familiar with it – its the results of a study of many millionaires in the USA and what their lives are like. Its interesting to learn that the truly successful live in a moderate house, drive a used car and vary rarely live in the rich part of town.
If your ever feeling blue about your outward financial appearance its worth a read. The next time you feel down you can quote stats on how the majority of people in apparently affluent neighbourhoods are actually in huge debt!
Ed
February 3, 2009 at 8:42 am
Ah. I remember “the talk”.
I’ll admit, when it came to finances, I was a little bit sheltered as a young adult. I didn’t have a credit card for a long time and my part time job and the fact that my father worked for a University (free education for kids) made sure I escaped getting my degree with no debt.
I’ve always tried to be honest when it came to money, so I’m pretty up front about what I spend. When we had “the talk” I did have some surprises. Stuff that was never an issue as a girlfriend became an issue as a fiancee. We needed to work out our ideas about money (he said credit cards were like extra cash and I cringed) and learning about each other’s paying and spending habits made us both blink. I can’t imagine what it would have been like to go into a marriage blind. Waaaaaay too scary.
February 3, 2009 at 9:19 am
When my now-husband and I knew we were serious about each other (even before we got engaged), we laid out all our cards in the table. All the good, bad and the ugly. And the day after we got married ,we went to our bank and incorporated our lives together. My debt became his, his debt became mine and everything went to one pot. We shared one credit card so everything is visible to each other. All the purchases were discussed and agreed upon. I have never hidden any purchases from him and I would never even think about it. And there’s not even a reason to hide anything. We’re very lucky that way.
February 3, 2009 at 9:45 am
@ MoneyManager, it’s good to be totally honest but not that you don’t have any credit/accounts in each name. If your sweetie gets hit by a car or you die of a heart attack banks will freeze all your joint accounts. So you/he should at the very minimum have a stash of cash in the house to make it through the probate period until they release the accounts. I learned that from a friend over 20 years ago when one of her best friends who’d worked throughout the marriage was deemed to have no credit and had no access to the accounts except to pay for the actual funeral.
February 3, 2009 at 9:55 am
Gail, we too are on the wrong side of town. However our home has been paid for for 15 years and most of our friends still have hefty mortgages. I was able to stay home with the kids whereas none of them could. The trade off for us was certainly worth it. We don’t owe anything that we can’t pay off each month at the moment. I’m just trying to figure out the budget that works for the irregular money coming in. We have RRSPs that have been pummelled by the markets but don’t need them for around 15 – 20 years. We saved for the boys educations from the day they were born. They needed to save 10% of what they make to go towards school. Sometimes an ongoing argument with the youngest. I’m trying hard to think of all the expenses that come infrequently and budget for them and save for a holiday my husband has committed us to in 2010. I’ve started an emergency fund out of hubby’s sight so therefore mind. If it’s in the account he wants to spend. It’s in a jar and he knows he can’t touch it. We’ve maxed out his TFSA for this year and I have started on mine. When he gets his tax refund this year it will go onto the RRSP for next year immediately. Out of sight out of spending reach.
Anyways, I love your show just wish we didn’t only get reruns now. Seems like global west dropped the show so I have to watch you on Viva or Entertainment! and they are all reruns. I bought the daily planner for my mom so that she can finally learn a little about finances. Something she has struggled with her whole life. Thanks for the info you provide!
February 3, 2009 at 10:02 am
Interesting comment Gail re: buying a home in a less-prestigious neighbourhood. When we bought our home all of our friends were shocked that we bought a house in the northeast part of our city. After all, it was a very multi-cultural area, why would we want to do that? Even people I thought were open-minded were surprisingly critical of our choice. It sure opened my eyes to the kind of people these friends were!
A modest house in the NE was amost $50,000 less than a modest home in the SE area we were renting in. Modest as in 1200 sq ft, 20 years old, no frills. Something we could happily live in for years and years. It just didn’t make financial sense to spend more just to live in a comparable house on the “right side of the tracks”, or to buy a less expensive starter home that we would move out of some day.
Well here we are 13 years later with a home that will be paid off this year, money in the bank and never one stressful moment wondering how we were going to pay for anything. Wish I could say the same for our friends, who have all “traded up” their first homes because they had to buy a lesser house just to live in a “better” neighbourhood the first time around. They all will have mortgages for years yet, while we will be socking away the dough.
Guess we were the smart ones!
February 3, 2009 at 10:34 am
…okay, I have a question. My husband’s student loan has been in collections (embarrassingly) for a while now. The collection company has offered settlements a few times, and we could not pay for them. We have been paying weekly for quite some time now and have increased the payments slowly and are now at $55 weekly. I saw his income tax receipt and all the payments last year went to interest (gross!). So I called to check the interest rate yesterday. The interest rate is low (variable 5.5%) but it had accumulated over a period of time that he was not paying anything. They offered another settlement yesterday, and we would have to put it on a cc. Is it better to clear it from collections and pay higher interest (would still be paid off in 3 yrs) or be able to claim the interest and keep making payments????? The settlement is approx $1500 less than what is outstanding, and they want a financial statement to see if he will even qualify for the settlement…
February 3, 2009 at 10:43 am
@Tanya, yes you are right.. and we’ve made adjustment since then.. (I was only trying to give relevant info re: Money liars issue), We have our joint account where both the paycheques go in and all the bills gets paid. And we have since kept a chequing/saving account in separate names in case of circumstances that you have mentioned. But we stash the same amount in both account.. (i.e. if I put in $100 in his savings, I also put in $100 in my savings). At the end of the year, we have the same amount in our savings. Having decided to mold our debts together is the best decision we’ve ever made financially i think. This way, its both in our best interest to pay it all off in the shortest amount of time.
February 3, 2009 at 10:57 am
Yet another good blog, Gail.
When I met my husband, the bond was strong from the get-go. We were quite upfront with our financial situations. Communication is the key to a solid relationship. And a happy, and lasting one. Even after 9+ years, there is nothing hidden when it comes to finances or purchases.
I applaud you for buying a home where it suited you best, and not where others felt you should buy. We did the same. We bought our home so far on the wrong side of the tracks, that it’s over an hour west away from the GTA. We are much better off than we would have been had we settled in “the city”. It’s cheaper, less crowded, and less stressful.
February 3, 2009 at 11:15 am
Money lying is so sad. I think people do it because they want to hide from the problem but also can’t bring themselves to come face to face with the shame and guilt.
Ed – I’ve read that book and it’s such a good point to remember.
I think that I have been judged before based on the kind of car I drive. I drive a car that is more than 20 years old. When I was trying to rent an apartment recently, the landlord seemed reluctant and demanded all kinds of proof. I don’t think we were the couple she was looking for, with the old car. A mismatching button on my coat. My partner wore running shoes and an old jacket. I think she was looking for a couple who reflected sophistication. What’s funny is that the opposite would benefit her… we prioritize commitments like rent and bills before spending on clothes and we have no car payments to make.
February 3, 2009 at 11:34 am
I don’t remember talking with my husband before we got married about debt. we knew each other had debt from student loans and had credit cards.
It seems like it wasn’t until we got married or even engaged that our credit cards started to rack up.
The only thing my husband really has kept from me the cost of is my engagement ring. And now we usually keep the cost of some gifts we buy for each other and thats pretty much it.
Were pretty open with each other about our finances.
I guess sometimes we don’t discuss buying something with each other then we tell each other after. Its not usually something bigger.
I can’t hardly hide gifts that I bought for my husband very well, i buy it then i want to give it to him right away. I just get so excited about what I have for him
February 3, 2009 at 11:54 am
Thank you – I needed this today. My car is old and is starting to be irreparably rusty, but it runs well and if it continues to run until next year, I can save enough for a very substantial down payment for my next (used) car (half of the cost). However, I’ve been getting very embarrassed to drive it in front of my co-workers and have been contemplating how I can fit in a new car payment now. This reminds me that I should really only care about the balance in my account growing and growing. Thanks for the reminder! While I write, my friend is in Cuba, worrying about her large and growing debt on her line of credit. I am so fortunate not to be in that position – as Dave Ramsey says, if I will live like no one else now, I CAN live like no one else later!
February 3, 2009 at 12:25 pm
We have a nice, but modest home in a decent neighborhood. We bought several years ago and have no intention of moving. Our family has grown, but we still have room for everyone and the kids are fortunate to each have their own room. Several friends have told us we’d have to “move up” when baby #2 was coming. We didn’t get it–we both grew up in small homes. I personally think it forces family interaction–you can’t hide forever in 1000 sq ft!
To live to the standards of others is to cheat yourself. I’m sure many think we are the “poor country cousins” who have litte or nothing. It comes out in their comments. But we are happy and we love where we live. We have money for the things we need and some wants. Life is good. Maybe thats what eats at other people to make them need to comment in ways that imply we have little. It makes them feel better.
As long as their issues don’t become mine, I think we are ok. Make a plan and live to it.
February 3, 2009 at 12:32 pm
Some of the comments here disparaging friends, acquaintances etc for not buying in the cheaper parts of town sound self-congratulatory. Luxuries like purchasing a home in a better location are fine so long as they can be afforded. If someone would rather spend a few more years paying off their mortgage to live in a better part of town, that’s not a fundamentally worse decision than taking the less expensive route. It’s different strokes for different folks. Money’s not an end in itself, after all.
February 3, 2009 at 12:45 pm
I am currently reading “The Millionaire Next Door” by Thomas J. Stanley, Ph.D, & William D. Danko, Ph.D…borrowed from the library.
It’s lovely to hear about the “us” versus “them”..of course, this doesn’t apply to everyone-some are living well because they work hard and have savings…but for all those who do the cover-up thing and really can’t afford the image….such a ridiculous waste of energy(and debt).
February 3, 2009 at 12:46 pm
I drive an old car~an 18 year old car in fact. My Mom passed it down to me when she stopped driving. (THANKS MOM!!) I always get comments about how I have to fix/watch/”pimp out” my little car because it’s just sooooooooooooooooooooooooo old. I hear “ooooooooh, it might not pass the drive clean test” and I’m like, well, it’s been passing the test for the last how many years so hey, I’m not that worried.
The reason the little put put is around is that dear Mom took care of it impeccably for all that time. I feel no need to rush and get myself into debt to show off, because I am not my car. Meanwhile, everyone else I know is sweating, dreading the next repair bill.
I’m a realistic woman, I know the little car won’t last forever, which is why I’m saving for the new one now.(THANKS GAIL)
Until then, everyone can eat my dust as I pass them (politely) on the DVP.
February 3, 2009 at 12:54 pm
I’m with Cathy on the car thing, if it runs well and it’s in good shape, keep it. My brother was willing to give me his 95 escort that is in good shape body wise, has 300+km, but I opted not to take it because the area where he lives has much better roads than here, plus I didn’t want the added expense of insurance. I take puclic transit to work (tax credit), if I was to drive, I’d have to pay to park on top of insurance, gas and maintence of the vehicle.
February 3, 2009 at 12:55 pm
Rebecca:
I don’t think that people intended to say that every one in ‘better’ neighbourhoods are snobs. Some probably are. It think the intent was to say to do what is right for you, not what others think is right for you.
It’s the good old:
“Don’t laugh, it’s payed for!”
bumper sticker.
February 3, 2009 at 3:10 pm
Rebecca – I don’t have a problem with people buying a house on the “right” side of town if they can afford it, and even if they can’t afford it it’s none of my business.
What I do have a problem with is people judging others by the neighbourhood they live in, the car they drive or the clothes they wear. And that goes both ways….I don’t want to judge someone a snob because they live a certain way.
When we bought our house, someone who I considered a very good friend said she would not live in our neighbourhood because she wouldn’t want her elementary-age son to go to school with kids who were “not like him”, e.g. were not white. Needless to say that person is no longer a friend!
February 3, 2009 at 3:54 pm
Rebecca – got to say I agree with you, there is an undercurrent here in the comments that wasn’t in the posting, that is somewhat unpleasant.
Take Karen for instance – Above she writes that “you don’t want to judge someone a snob because they live a certain way” but that’s inconsistent with her earlier posting. In it she disparages her friends who bought in a “better” (note the quotes) neighbourhood for having a mortgage for years longer than you and conclude by saying “Guess we were the smart ones!” – meaning they’re the dumb ones.
Now I’m not trying to start a flame war (long time readers will know that’s not my style) but I think Rebecca had a valid point – there’s nothing intrinsically wrong with choosing an upscale house.
For instance, some people prefer to pay down their mortgage first, at the expense of making rrsp payments. Others reverse it. Nothing is intrinsically wrong with these choices, they’re choices.
February 3, 2009 at 4:04 pm
I loved the book “Rich dad poor dad” to bring out the the faults and misrepresentation that goes with keeping up appearances.
I chose my home on value for the dollar, not public opinion, and I have not regretted it for a moment! (and a paid for, rusty, reliable car too).
My finances are open to my husband, even so we are not perfect, I will admit! I am a healthy weight, I eat my veggies and I have no significant vices…. BUT I LOVE chocolate!!! LOVE it! And my husband doesn’t want it in the house, so I hide it…. not every single morsel, but I think he only knows about 1/3 of the chocolate I eat. It doesn’t cost very much (so it’s not a financial secret) but it is a deception that I have got into the habit of to placate his disapproving looks and health lectures.
February 3, 2009 at 4:13 pm
Thanks for the posting Gail. Funny enough about the topic, yesterday night, I got into a conflict with my partner. I was informing him to utilize his no fee chequing account, instead of his 6.95 dollar a month one. I told him that the interest he’s earning from his tax free account of five thousand dollars is being spent on a monthly fee from his other chequing account. Turns out, he mentioned that he wants a private account of his own, without me having access to it, because then I will comment on his transactions. He has full access to my account and I’m very liberal when it comes to that. We’re also in the first steps of buying a condo soon.
I’m still upset about it and we’re going to talk about it again tonight. If he wants another account for himself, that’s fine and rational, as long as it’s free, and he’s not doing it to hide things from me. It’s quite a sticky topic…
Respectfully,
Josef
February 3, 2009 at 5:04 pm
I think I mentioned this here before, but I was at one of those sales parties where there’s a person presenting a product to a bunch of ladies. And the salesperson advocated hiding your purchases from your husband. I was flabbergasted. I mean, I can see why it works for her as the person trying to get you to buy stuff, but what a horrible tactic.
Every month my husband and I go through our money together. We’re pretty open. And I’m glad about that.
February 3, 2009 at 5:19 pm
I have to admit, in days gone by, I’ve been tempted to hide money from my spouse in order to save it. In some ways it could have started a little nest egg, but it also would not have encouraged us to get on the same page with respect to money. In our ongoing discussions on how to handle our finances, we’ve become closer in other ways. I think hiding money (or purchases or debt) just chips away at the honesty that I think it required in a committed relationship. Now I don’t have to hide the savings-my husband and I save together-it wasn’t the easy route, but it certainly paid off to be honest!
February 3, 2009 at 5:34 pm
Psychsarah – I like that you and your husband have worked through it together. I am like you, tempted to save money on the sly, but trying to work through it with my partner. And he is getting there. I just need to be patient and not accusatory. Accusing people just puts them on the defensive.
I agree there are some judgmental undertones in these posts. Even people who are not focused ‘keeping up appearances’ can overspend. We have an older car, a little house and shop second-hand, but we still overspend. We are working on it though. And my job is to get my partner on board – not to push him so hard that he starts hiding things from me. If we want to have a life together, I have to appreciate his baby steps and encourage him to make some more.
February 3, 2009 at 9:04 pm
Gail,
What a thought provoking blog, and so true! I enjoy reading your blogs everyday and have put into practice much of the advice you have spoken about. This really hits home, its the very next thing I will be working on. My husband and have just over the the last 6months communicated more effectively about our finances (thanks to you) now I need to be more honest about were we stand financially with friends and family and stop feeling guilty about trying to keep up with them ( I am sure their lying too). I have started saying no to the things I can not afford. I am sure they think were having money trouble, but if we continue the way we had been, we’ll have real money trouble and very shortly too. I am happy to say this will not happen, and our debts are being reduced every week.
Thank you for showing me the perspective that we needed.
Catherine42
February 4, 2009 at 4:08 am
Gail, another great post, and quite the hot button for your readers!! I grew up in a money dysfunctional family. Unfortunately, my late father was very immature about money management, and my mother learned early in their marriage that if she wanted to feed her five children, she would have to put $1 or 2 away when she could. She was so good at it that she became an ‘enabler’ to my dad – when he got in a bind, she would bail him out, and he never bothered asking where the money came from. He came to expect that she would always have the means to cover his butt. Her credit rating is impeccable to this day. The sad part about this is that he never had the motivation to ‘man up’ to the responsibility of sharing the load (not that he didn’t work hard, he just never worried about whether there was enough to cover everything). This has carried over to all of us siblings, and not being comfortable discussing “private” money matters is something we all suffer from. I can honestly say that my second marriage collapsed partly from money issues. After watching Gail’s shows, and visiting this site daily, I am more confident that I deserve to know all the dirt on a significant other’s financial quirks, and that my situation would not be mine alone. Secrets are no way to build a relationship, but one heck of a way to destroy it.
On the other issues of houses/cars – I have had one brand new truck off the lot in my entire life, and within four months it was vandalized twice!!! No one has ever smashed the windows of my 10+ year old minivans, or dragged their keys down the side. My son calls my current minivan the “Loser Cruiser”, and I ask him if he would rather walk! It has almost 300K on it, but not one spot of rust – once yearly wax and polish job for $50 keeps it looking like a million bucks! Growing up, we were always taught that you did not have to ‘look” poor, even if you were. Poor is a relative term – as long as you have a roof over your head, clothes on your back and food in your home, it doesn’t matter how big your bank account is. We are so busy accumulating “stuff” to keep up with the neighbors that we forget to live.
I have to share my mother’s tip on saving! She asked me if I had CAA, and advised that I could get free Traveller’s Cheques. “Just put them away and you will always have that money” I mentioned that they could get stolen, your house could burn down or you forgot where you hid them! And what about earning interest?? I was basically told not to throw anything out without going through it when she passes away!!! I wonder where she has her stash hidden now……
February 4, 2009 at 11:32 am
Amber I hear you on the sales party things, i do pampered chef and ihear that from the ladies that are buying the product. Myself I would never encourage to use your credit card and hide it from your husband, i know some consultants who do. I just state what types of payments I accept and sometimes add a joke at the end but not one related to hiding your purchases from your spouse. Im all about being upfront with each other.