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Heather Jones

One of the biggest threats to the stability of a marriage is disagreeing about money. Generally speaking, people tend to get divorced for incompatibility, irreconcilable differences and money problems. Of course, different attitudes about money could also fall under the categories of incompatibility and irreconcilable differences. The bottom line is that a married couple should absolutely be on the same page about their shared finances and to be on the same page, there must be honesty in regard to the shared finances. Considering that Wisconsin is a community property state all income earned during a marriage is community, with each party being entitled to an equal share, regardless of the actual income of each party. Furthermore, all debts acquired for the benefit of the marriage will be viewed as marital debt, making both spouses responsible for debts they might not even know about.  

So what do you do if you discover that your spouse has been hiding money or debt from you and you could be financially implicated by that dishonesty? Read on for a general guide to financial infidelity in Wisconsin.  

What is Financial Infidelity?

The definition of financial infidelity is when a married couple with shared finances are dishonest with one another about debt or income.  

For example, one spouse could have child support payments being garnished from their paycheck but neglect to inform the other spouse that is happening. Another example would be one spouse getting and using one or more credit cards that the other spouse does not know about.  

The issue here in addition to the dishonesty is that during a marriage, all income and debts are considered to be martial. Marital debt means that you could be liable for the hypothetical credit card debt if your spouse neglected to pay it and the account went into collection. Your credit score could also be impacted by the collection action, perhaps taking years to correct.  

Marital debt aside, there are also situations where one spouse attempts to hide income and other assets from their current spouse in a bid to keep them from being counted among martial assets in the event of a divorce. This could be separate secret bank accounts, cash hordes, having a family member or close friend hold money for them or even hidden real estate. There have even been instances of one spouse insisting on the marital home being titled in their name only in an attempt to keep the other spouse from receiving their lawful share if the couple separated. While the more extreme version really edges into the territory of financial abuse, it starts with the infidelity. In situations like these, knowledge is your best defense.

How Common is Financial Infidelity?

Financial infidelity is actually very common but it is rarely ever brought up until the couple makes the decision to divorce. Once a divorce in Wisconsin (and most other jurisdictions) is initiated, the parties must fill out financial disclosure statements. The court requires the financial disclosure so that all parties are on an equal playing field when it is time to divide the assets and debts from the marriage. With so many transactions taking place online, it may be the first time one spouse becomes aware of the other spouse’s paycheck deductions or how many credit cards they actually have in their name. It can be a very ugly awakening, adding incredible stress to an already difficult situation.  

The National Endowment for Financial Education conducted a decade long study on financial infidelity, ending in 2018 and found that it is a prevalent problem for couples. Among the couples who participated in the survey, two out of five respondents in a couple stated that they had practiced financial deception in their relationship. One third of the respondents said that a spouse had hid a purchase, cash or a bank statement from them. A full 75% of the respondents stated that the financial infidelity had negatively affected the relationship.  

More recently in January 2021 U.S. News conducted a poll and found that 38% of respondents had either committed or been a victim of financial infidelity.

So financial infidelity isn’t a rare occurrence and does not appear to be going anywhere any time soon. Read on if you suspect there may be financial infidelity in your relationship.

What do I do if I suspect my Spouse is Committing Financial Infidelity?

The decision to do some checking is a delicate one. If you suspect financial infidelity, you do have a right to ask questions but there is always the possibility that there are no answers to be found or you could get caught searching and have to have a difficult conversation. Here are some things to look for.

  • Watch for large withdrawals from joint accounts (could be using to pay bills on an unknown debt or asset)
  • Watch for checks made out to “cash”
  • Watch for excessive spending on clothes, tech items or vacations, with no explanation on how they were afforded
  • Ask yourself when the last time you saw a bank statement for any joint account was. If you have not seen one lately and you do paperless online banking, make sure all statements go a joint email account
  • Make sure your name is still actually on any previously held joint accounts, you might not have been informed if you were removed
  • You have been removed as an authorized user of a joint credit card
  • Your joint savings or checking account balance is lower than you were expecting on a frequent basis
  • If you are not paperless, your partner always gets the mail
  • Your partner becomes tense or emotional when you bring up the topic of money, your partner could also start expressing more worry about your financial future

These are just a few of the potential signs that there might be financial infidelity in your marriage. If you are seeing any of these, a subtle way to dig further might be to suggest that you and your spouse meet with a financial planner to discuss your future and see how they react.  

Is Financial Infidelity Grounds for Divorce in Wisconsin?

Technically speaking, you do not need “grounds” for divorce in Wisconsin. You simply need to tell the court that the marriage is irretrievably broken. Financial infidelity, if it is severe enough and cannot be fixed by the couple, would certainly render the marriage irretrievably broken since the lack of honesty and the considerable damage to trust could be impossible to overcome. Furthermore, there is the issue of the debt or hidden assets to deal with, your spouse has placed you in a very damaging situation. Money that should have gone to the family was spent on other things without your knowledge or consent.  

If you do eventually decide to file for divorce due to the financial infidelity, be prepared to include whatever information you have regarding the issues in the initial documents. The court should be aware that there has been mismanagement of the martial assets and discovery will probably be required. Your Wisconsin family law attorney can devise a strategy for uncovering any hidden assets or debt. Unfortunately, the financial infidelity that caused your divorce will complicate the actual divorce proceedings.  

Your financial responsibilities if you are considering Divorce for Financial Infidelity

You will need to get copies of all financial documents available to you. Get all real property and assets appraised and make sure you have copies of your taxes. Be prepared to start planning for your financial future as a single adult and also look into finding assistance for any financial repair you will have to do.  

What if I don’t want a Divorce due to Financial Infidelity?

You can always try to get your spouse to join you in couples counseling. There are counselors who focus on attempting to work out financial infidelity in a marriage. It would be a good idea to try and keep finances separate while you and your spouse attempt to work things out.

It is always hard to discover that someone we love and trusted has been lying to us. Sometimes the issue can be worked out between the couple and sometimes you just have to walk away before greater damage is done. If you do decide that you cannot continue with the marriage, you should consult with an experienced Wisconsin family law attorney. Furthermore, you should alert your attorney to the financial issues that led to the breakup of your marriage so that the appropriate strategy can be developed. If we can be of any assistance, please feel free to call us. We are here to help you.

Disclaimer: The information provided on this blog is intended for general informational purposes only and should not be construed as legal advice on any subject matter. This information is not intended to create, and receipt or viewing does not constitute an attorney-client relationship. Each individual's legal needs are unique, and these materials may not be applicable to your legal situation. Always seek the advice of a competent attorney with any questions you may have regarding a legal issue. Do not disregard professional legal advice or delay in seeking it because of something you have read on this blog.

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