My boyfriend struggled to come up with a down payment when we bought our house. I have $50K in investments. Was I wrong to keep this to myself?
I have an ethical money question for you.
I’ve recently become aware of the concept of financial infidelity, and am wondering if I am actually a transgressor myself. I have a longtime romantic partner. We are not married, but we have been living together for many years. Our state does not recognize common-law marriage, for what it’s worth. We share expenses equitably based on income and have a few joint accounts for things like vacations, a down payment and emergencies.
Other than that, our finances are separate. He is much more of a spender and I am much more of a saver. Over the past five years or so, I have contributed to an investment portfolio that has done quite well, and it now has about $50,000 in it. He knows nothing about this account. Am I committing financial infidelity by not disclosing this to him? I’m worried that if I tell him, he will think of 100 things that we could spend that money on and will push me to cash out.
We recently purchased a home together — we are first-time homeowners — and I contributed about 50% more to the downpayment than he did, although we own the house 50/50. He will be contributing slightly more to the monthly mortgage payments given that he earns more than I do. We weren’t able to put the full 20% down because houses are so expensive now, but our mortgage will still be manageable for us, and our mortgage insurance is quite low.
I could have cashed out my investments to get us closer to a 20% down payment, but I really did not want to go there, since I already paid so much more toward our down payment. Am I a monster for keeping this to myself? Am I wrong for expecting him to continue paying a higher percentage of our monthly expenses since he earns more, even though I have these financial reserves? This has left me with a sour taste in my mouth.
Is he legally entitled to any of my capital gains, even though we aren’t married? What if we get married — how would that change the way our assets are owned? I know I should have just told him at some point, but I never expected my hobby investments to do so well that it could make a real financial impact on our lives. What now? Do I come clean? I would appreciate your advice.
Secret, But Not Malicious, Saver
No ring, no sing.
You are not married, so you are not under any obligation to reveal all of your financial affairs to your boyfriend. However, it would be far healthier if you felt comfortable enough to share details with him without feeling like you would have to divest yourself of your assets. Believing you have to hide certain details from him for that reason is codependent behavior. The more you feel like you are obligated to acquiesce to his requests, the more you will hide from him — and the less trust will exist between you.
You were not obligated to empty your pockets when you bought this house. Had you sold those stocks, you would have been depriving yourself of all future increases in the value of your portfolio. Set your boundaries in this relationship. And if your boyfriend discovers you have a $50,000 investment account? Do not apologize for having it. Say, “Yes, I worked hard to save and invest that money. It would not be smart to sell my stocks.” You have no reason to feel bad for investing in your future. Anyone who tells you otherwise only has their own best interests at heart.
No doubt there are many things you and your boyfriend have not told each other about your finances or personal lives. One of the most unhealthy habits in a relationship — if it comes from a place of insecurity and idle curiosity rather than concern — is asking a partner, “What are you thinking?” We are all entitled to our private thoughts without having to spill them out on the kitchen table. The same is true for your respective financial habits. Does your boyfriend ask your permission every time he splurges on something? No. Do you ask him if it’s OK to invest your money? No.
Before buying a home or getting married — assuming you are planning to get married — you should sit down together and discuss your approaches to money. Your $50,000 investment account is a big achievement, so please do not carry any shame or awkwardness about it. You can choose to open a joint bank account where you both contribute money, for example, or you could continue to keep your finances completely separate. I have interviewed couples who have done exactly that — and with great success.
Believe it or not, 42% of people in a relationship say they keep financial secrets from their partner, according to a recent survey by Bankrate. Among them: spending, at 30%; debt, at 23% (this is problematic, especially for couples who are buying property or plan on getting married); secret savings accounts, at 19%; secret credit cards, at 18%; and secret checking accounts, at 17%. In addition, 11% said they have spent $500 or more without their partner’s knowledge, while 7% say they’ve privately spent at least $1,000. Not all of these “secrets” rise to the level of financial infidelity.
Consider a prenuptial agreement if and/or when you get married. Rather than feeling like you have to give up your investments, start making plans now for how you can protect your separate assets. If you divorce later, you may end up wishing that you had taken such action. Unless otherwise stated in a prenup, the increase in value of those investments could be deemed community or marital property. What’s more, don’t add marital funds from a joint account to your investment account. That too could risk commingling those assets.
In an ideal world, you should be open about, and proud and protective of, your investments. Practice saying something like: “I invested that money as a long-term investment. If I cashed out now, I would not only lose the interest I would earn on the principal, I would lose the interest on the interest too.” Then you could explain the magic of compound interest. Women tend to apologize more than men, studies show. Stand firm and stand proud. If your boyfriend did not invest money in a brokerage account, whose fault is that?
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