Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
This article is the latest part of the FT’s Financial Literacy and Inclusion Campaign
How people manage money with their other halves is something I find fascinating, particularly because so few of us ever talk about it — sometimes, even within our own relationships.
It’s possible to read the financial compatibility runes before your very first date. Will it be a swanky restaurant, street food or double espresso? And will they insist on paying, go Dutch or bring along a discount voucher? (Martin Lewis once said the latter was a sure-fire sign your date was marriage material — you may disagree).
It could be a while before you disclose your property ownership status or how much you both earn. I know a surprising number of couples who have no idea what their other half makes.
Normally, it’s not until you start living under the same roof that questions about joint accounts and how you might divide and mingle your money come up — and this is the point at which things can take a sinister turn.
One in six women has experienced financial abuse from a current or former partner, according to research by the charity Surviving Economic Abuse and it really can happen to anyone — including financial experts.
On Money Clinic podcast this week, I spoke to Sarah Coles, a senior personal finance analyst with Hargreaves Lansdown, who was trapped in a financially abusive relationship for years.
She likens the experience to “slowly boiling a frog”. As the abuse builds up so gradually over time, “you just adapt, and then it becomes this impossible situation”.
It’s all about control — and when an abuser controls your finances, they can control everything you do.
At first, her ex-partner would sulk if she spent her own money on things she needed, but over time his reactions became more extreme, evolving into rules about what she could and could not spend money on. If she tried to push back, the restrictions would tighten. Sarah ended up working three jobs to support the family, while he quit his job and spent money like water.
Financially and emotionally drained, victims of abuse feel powerless to leave, and our secrecy about money as a society plays into the hands of abusers.
Charities say many abusers are using the cost of living crisis as a tool, providing a convenient cover story if they take away a victim’s car or stop them from socialising with friends.
Sarah’s friends and family had no idea what was going on until one day, she was caught off guard by a question about why her clothes didn’t fit, and admitted she wasn’t allowed to buy new ones.
As she tells me on the podcast, after that conversation, she could clearly see that she needed to get out. “You’re just so busy coping with it that you don’t really take a step back and think about the full picture of what’s happening to you.”
After her ex passed away, Sarah chose to speak out about her experiences to raise awareness of how common a problem this is: “Personally, I don’t feel at all ashamed — I think anyone can fall victim to abuse.”
Nor is this problem exclusive to women, or indeed heterosexual relationships.
Arguments about spending too much money are part and parcel of everyday life as bills soar, but is your partner prepared to compromise, or will they wield control?
I have a friend who left her (female) partner after years of being financially bullied via the unlikely medium of an Excel spreadsheet. The lower earner by some margin, she would feel nervous if her girlfriend suggested they went to a fancy restaurant. If they had any kind of disagreement over the meal, her partner would coolly add “make sure you put your half of this on the budget spreadsheet” knowing this would wipe out her ability to socialise for the rest of the month.
Having children can also be a catalyst for abuse if one partner becomes a full-time carer and loses their earnings power (we hear from another survivor on the podcast who experienced this).
The loss of earnings power is tricky to navigate in non-abusive relationships. After years of being financially independent, feeling like you have to beg your partner for money is deeply uncomfortable.
And while leaving all the “money stuff” to your husband might have been the norm in previous generations, this could cost you in more ways than one.
Wealth managers say it’s often a huge struggle for widows to take the financial reins later in life (it’s also a challenge for an industry geared towards supporting the needs of male clients).
For younger generations, there are different issues. The high cost of renting a home on your own — let alone buying one — adds to the pressure to couple up swiftly, and could also make it much harder to leave a bad relationship.
Your Juno, a financial education app aimed at Gen-Z women, introduced specific modules about financial abuse after a poll of its users found that 26 per cent had already experienced it.
The importance of building up a “Fuck Off Fund” (a phrase immortalised by a Billfold article by the US financial journalist Paulette Perhach) is by far the most downloaded lesson in the app, says co-founder Margot De Broglie.
“A lot of community members have shared that they leave any financial talk until it becomes absolutely necessary, so quite late into a new relationship,” she adds, making it harder to spot warning signs.
A separate module on how to bring up the topic of finances when dating is also incredibly popular, offering a range of questions to test the waters in the early stages of a relationship (“Are you saving up for anything fun?”) building up to when things get more serious (“What financial decisions do you think should be made as a couple?” or “If I spent £100 on something and didn’t tell you, would you be upset with me?”)
Users are also urged to watch out for potential signs of financial manipulation, including their partner being secretive about money, having a lifestyle that’s at odds with their income or asking to borrow money.
Surviving Economic Abuse has found that 60 per cent of people who experience financial abuse will also be coerced into debt by their partner, making it even harder to leave and rebuild their lives.
“Creditors can be fantastic, and in many cases can write off the debt completely,” says Nicola Sharp-Jeffs, the charity’s founder, noting that banks are now doing more to help victims (TSB and HSBC offer “safe spaces” in branches and, increasingly, employers have policies around domestic abuse).
Slowly, the financial industry is waking up to the scale of this problem. But the hidden nature of financial abuse partly rests on the taboo nature of discussing how we manage money in relationships and getting a sense check about what is normal, and what is not. I definitely think it’s something we should all try to talk about.