- Financial abuse and neglect is often an invisible form of domestic violence and can also occur in business partnerships and workplaces.
- Some financial abuse involves unlawful or criminal behaviors.
- There is hope and help available if you are experiencing financial abuse or neglect in a relationship.
Financial or economic abuse is a type of domestic abuse that may occur between partners or exes, parents and children, and in other financially dependent relationships. Financial abuse can also happen in workplace settings and business partnerships.
During clinical training, therapists learn about physical, emotional, and sexual abuse, but what about financial abuse and neglect? Most people think that domestic abuse involves different forms of psychological and emotional abuse. However, financial abuse between intimate partners is an invisible form of domestic violence. Furthermore, financial neglect is not upholding the legal and ethical financial relationship requirements.
What Financial Abuse Looks Like in an Intimate Partnership
Financial abuse is a form of bullying to manipulate or control the other person, often to improve their own financial circumstance. I first noticed the financial abuse phenomena in my therapeutic practice when Laura, a young mother, came to me for therapy and reported extreme financial inequality in her marriage to an older man. When Laura entered the marriage, she brought no debt and some savings. However, he used her money to buy a luxury car, which he drove to work, and she was not allowed to drive. Instead, she took the train to her full-time job.
On evenings and weekends, Laura took her small children on the bus to grocery shop and run errands. She did all the household chores and cooking while directly depositing her paycheck into his personal account. He gave her $30 a week for “spending money,” which was supposed to cover anything she needed, including work clothes, makeup, food, and transportation.
Meanwhile, he lavishly spent money on himself. Laura wasn’t allowed to open or view credit card statements that arrived in the mail, even if her name was on them. Clearly, she was a victim of financial abuse while in this abusive marriage.
Typical warning signs include:
- Fear or anger about money issues in your relationship.
- Frequent arguments or conflicts about money.
- Feelings of inequity, or imbalance of power and control in your relationship.
- Financial guilt, financial shame, and financial anxiety.
- Not feeling financially safe or secure.
- Coping with abrupt financial loss or the chronic stress of having inadequate financial resources because of the past caused by financially-triggered PTSD.
As we addressed financial abuse in Laura’s marriage in our therapy sessions, in the course of a few years, Laura courageously transformed herself, her career, her finances, and even her marriage.
8 Hidden Types of Financial Abuse and Neglect
Financial abuse and neglect can be disguised in relationships through:
- Financial lies, secrecy, or deception. Trust in the relationship can erode when there is a lack of financial transparency. For example, someone exhibiting shady financial behaviors, like having unexplained wads of cash in their wallet.
- Financial infidelity. This is when the lies and secrecy reach a level of betrayal—such as having secret debt or assets, or even a secret second partner and family (which I have seen several times in my practice)—that what's known as "financial infidelity" results.
- Financial gaslighting. This is when somebody makes you feel crazy or guilty for having normal emotional responses or reasonable requests or boundaries. For example, young adult children indicate that you are a bad parent for trying to set healthy financial boundaries with them or a partner says it is your overspending on groceries—rather than their expensive weekend getaway with friends—that is the reason you don't have money in your joint account for rent.
- Drug, alcohol, sex, and gambling addictions. Addiction can cause financial devastation to addicts and their families. One of my client’s families went from extremely wealthy to being poor and on public aid in the span of two decades due to untreated addiction.
- Financial bullying or pressure. This behavior can lead to power and control and manipulation issues in the relationship. For example, one partner may push the other to buy a home that is far beyond a comfortable price range for them. To manipulate the decision-making process, they may use aggressive tactics or emotionally withholding behaviors.
- Financial shaming and put-downs. It is financially shaming to belittle somebody for earning less or nothing at all because they are a stay-at-home parent or disabled or chronically ill. Additionally, it’s not acceptable to criticize your partner by speaking poorly about their spending behaviors or debt in front of others.
- Financial stonewalling. When this happens, people shut down and refuse to talk about financial realities. That includes no communication, collaboration, negotiation, or conflict resolution. Meeting with a neutral mediator such as a financial advisor, financial planner, debt consolidation agency, financial therapist or coach is off limits.
- Financial withholding of resources. Withholding resources such as access to bank accounts, credit cards, financial statements, transportation, property, healthcare, or even food is a way to isolate a victim in an abusive relationship and is abusive and neglectful.
When Financial Abuse or Neglect Becomes Unlawful or Criminal
There are repercussions to financial abuse. Often, it may result in not paying legally required financial obligations such as rent, alimony, maintenance, or child support. If desperate, it becomes a downhill spiral. They may take out loans or credit cards in another person’s name resulting in identity theft. They may steal by using somebody’s bank accounts, credit cards, property, or cash without permission.
Elder financial abuse is on the upswing. Elder fraud refers to illegal schemes that target older individuals. According to the National Council on Aging, elderly Americans who are victims of financial abuse lose an estimated $36.5 billion annually. If you feel at risk or know someone who has been targeted, report the suspicious activity to Adult Protective Services in your area.
Get Help for Financial Abuse and Neglect
For immediate help, reach out to the Consumer Credit Counseling Service, or a personal banker, credit union rep, or financial advisor who can offer you consultation and professional help. Consider a free, anonymous Twelve-Step program or find a therapist who specializes in financial issues, There are also online resources and books that can help you improve your financial literacy, self-esteem, empowerment, assertiveness, financial boundaries, and recover from financial trauma, thus improving your mental and financial health.
Help is available and effective and you are worth it.