Financial lies and how they affect people’s lives
June 12, 2023
Lying can often cause more problems than it’s meant to avoid, and this is particularly true when someone lies to their significant other about financial matters.
The financial lies people tell can get a person or couple in trouble in many ways — including when planning for retirement. But with the right guidance from financial professionals, retirement plan participants can work to avoid having lies dig themselves into deeper financial holes.
What financial lies do people tell?
Truly damaging financial lies are generally bigger than, say, telling the family a pizza night is affordable though their budget is tight that week. While that’s certainly not ideal, the kinds of financial lies that can set people back are typically more serious.
Common lies about finances in relationships include:1
- Shopping trips
- Gambling habits
- Salary information
- Savings accounts
Maybe someone’s spouse is hiding bags full of brand-new purchases in the trunk when they return from lunch. Or maybe a plan participant bought a $1,500 TV but told their partner it cost $500. Perhaps their spouse mentioned they had $10,000 in debt before they were married, while the actual debt is $100,000.
Some financial lies can be even more serious than that. Taking out a second mortgage without telling a spouse; financing thousands of dollars for a new car; secretly gambling away a child’s college fund. Those are just a few examples, but the American people — and perhaps some of your plan participants — have possibly experienced similar scenarios.
Such lies carry very real consequences beyond the personal aspects of the relationship. Credit scores could be affected, which could lead to getting turned down for a loan. These types of lies could also affect participants’ retirements and their ability to adequately save.
It’s possible that there may be underlying circumstances for financial lies, and it’s a good idea for anyone who finds themselves lying about finances to consider seeking professional counseling in order to get to the root of the behavior. In the meantime, however, those behaviors must be understood and addressed, at least on a surface level, to help prevent further potential damage.
One important path toward a solution is getting your clients to realize their “financial personality.”
What is a financial personality?
Someone’s financial personality is the summation of their attitude and strategy regarding fiscal responsibility and long-term financial plans. Financial professionals can help clients or retirement plan participants figure out their financial personality as a way to help them better understand how they approach finances and how they address any issues — including the perceived need to lie about finances.
You can help a client or plan participant determine their financial personality by having them take our “Your Money Personality” assessment. When that’s completed, they’ll know where they stand in four crucial areas:2
- Emotions: How they feel about money
- Outlook: Their viewpoint of money
- Focus: The present or the future
- Influence: Others affecting their money decisions
This is a great way to find a person’s strengths and weaknesses when it comes to money, and could be the first step in minimizing potentially harmful financial behaviors.
Financial wellness programs
Financial topics can be difficult for some people to understand, and they may feel embarrassed when struggling to understand certain concepts. Taking advantage of financial wellness programs developed by experts can provide the education – and confidence – they need to make decisions that are in their best interests.
CUNA Mutual Group remains dedicated to helping financial professionals and plan participants with the resources needed to teach good financial habits. Some of these resources can even help couples communicate better about money — making for a much healthier relationship and financial state.
If you’d like to learn more about how you can help people overcome financial lies that can ruin their lives, please reach out to us today.