Have you ever stood between two mirrors and caught glimpses of yourself cascading into an accordion-pleated tunnel of mirror images stretching to infinity?
I experienced one of these moments while passing through the liminal doorway between conversations; the stories relayed by business owners and their spouses revealed behavioral financial insights into spousal relationships to money and their partners.
Consider this analogy. A husband or wife might collude to hide financial decisions from his/her spouse in the following ways:
- Jules, the triathelete, tells his wife he’ll spend $2500 for a new bike; she discovers that he actually spent $6,000. He rationalizes both to her (and himself) that the additional $3500 spent on “components” are replaceable additions to the bike .
- Penny hid her shoe compulsion by scuffing up the soles of every new pair of shoes she bought. Whenever her husband queried the new addition of a pair of shoes, she silently showed him the bottom of her shoes.
In both cases, one spouse rationalizes a financial decision–first to himself and then to the other. The deceptive spouse believes that s/he is “getting away” with something. However, such behavior has the predictable effect of undermining trust in the relationship.
Behavioral financial pioneers Brad and Ted Klontz and Rick Kahler, authors of Wired for Wealth, define financial infidelity:
Financial infidelity includes lying about, hiding or omitting information about your financial behavior from your partner, especially when the discovery of the secret behavior would result in feelings of guilt or shame. Financial infidelity includes secret spending, secret giving, secret borrowing, secret receiving, secret investing, secret gambling, and secret income.
Source: Klontz, B., Klontz T., and Kahler R. (2009) Wired for Wealth: Change the Money Mindsets That Keep You Trapped and Unleash Your Wealth Potential. Deerfield Beach, FL: Health Communications, pp.108-109.
These unconscious, implicit financial agreements feel like an affair: one partner is hiding something from the other. In the same way, business owners sometimes hide issues from their significant others, such as the degree of business risk they have taken on, cash flow challenges, or contentious office or client relationships that subtly spread their venom into personal relationships, etc.
As business owners, we make many small decisions every day—which prospects to call on, which vendor to use, what office supplier to use. It’s easy to do the same thing with the larger decisions as well—which adjacent markets to enter, whom to partner with, how far to extend our credit, when to shift priorities. Before we know it, we may have entered the no man’s land of business infidelity. In this place of unconscious decision making, small and then larger infidelities slip in. In reality, we business owners are hiding from no one but ourselves. The issue is transparent to everyone else. Every decision we make that we think we’re hiding will have unintended consequences on employees, partners, and family members.
What are some of those potential areas?
- Vendor or client relationships that are energy vampires that suck the life out of you and your firm.
- “Wrong” clients or disengaged employees who become time vampires for your firm.
- Debt servicing/cash flow issues that create doubt about your ability to make payroll.
- Lack of clarity in setting clear expectations between partners including business continuity planning
We live in a world that longs for authenticity–for a solid place to stand. Will you come clean and admit your affair? Or will you keep hiding? It’s up to you!
Toolkit: 
Here are a couple of ways to re-engage your spouse/significant other:
- Ask your spouse for an honest assessment of how s/he sees the current impacting of your business.
- Ask yourself the following financial questions:
- Am I secretly spending or committing family funds/resources (2nd mortgage, etc.) on my business?
- Am I secretly going to family members, partners and others for loans without first consulting the situation with my spouse?
- Do I exhibit any other covert spending, saving or investing patterns that could be impacting these relationships?
- Grade yourself (A+ to F) on the health of your relationship with your:
– spouse,
– kids,
– friends,
– significant others
– and colleagues
- What are you currently doing to manage stress? How’s that working for you?
- What image do you seek to perpetuate? What’s the reality? When does your image management become self-deceit?
