Divorcist is pleased to partner with Cecile Gallot, our “financial advisor whose been there” for a new series full of financial advice and encouragement. For starters, she’s helping us identify financial abuse and what it really looks like. Find out more about Cecile here and email your pressing money-related questions to firstname.lastname@example.org.
Financial abuse can happen to anyone
When I was in college I moved in with my boyfriend. He was working while I was going to school so he ever so sweetly and gallantly offered to take care of all the bills so that I could concentrate on school. I quit my part time job that wasn’t really bringing in that much anyway, so it didn’t seem like a big deal. It wasn’t long after that he suddenly started getting sharper with me, accusing me of any number of things that I assured him I either wasn’t doing at all or definitely was not doing maliciously. I was constantly in the position of having to defend my actions. I was so busy trying to make things right, to clear up miscommunications, prove to him that I wasn’t cheating, that I can’t exactly say when I started feeling trapped.
Stuck with Mr. Wrong
My money was gone, I was no longer close with any of my friends, and going back to my parents didn’t feel like an option, either. When I got into the relationship I didn’t know any better. I’d led a pretty sheltered life up until that point, social media wasn’t a thing, people didn’t openly talk about dealing with abuse, and there was just a brief mention of what a sociopath was in my Psych class. Although yes, it did describe him.
People don’t really change
Before meeting him, I didn’t know what to look out for. He never hit me or physically hurt me in any way. And I’d naively thought that by twisting myself into a pretzel I was helping him. He’d been hurt before and was just wounded and insecure. I had no frame of reference for his reactions and behaviors. I’d never met anyone like him before. I was doing what I thought was best because I cared about him and wanted to help him. I always gave him the benefit of the doubt with the childish belief that love would heal him and he would change.
One day it hit me: I couldn’t possibly love him because truth be told, I didn’t even like him. He was not a nice person. I made a drastic decision and moved across the country to get away from him. His attempts to hoover me back in fell flat from the distance. After that relationship I vowed to always keep my finances separate and to always make my own money. And I foolishly thought that would be enough to protect me.
What all abuse has in common
There are different types of abuse, but every single one of them is about control.
Physical abuse is the easiest to spot, usually. When it happens in this day and age you know exactly what’s happening. The problem is that it doesn’t happen in a vacuum, and it’s not the first or only control tactic that the abuser utilizes.
Psychological and emotional abuse
These are much harder to spot. It takes time for any patterns to develop. Everyone has bad days from time to time, everyone can be snarky or maybe forget that they said something, right? So these abusers get the benefit of the doubt for a while.
Financial abuse is often present in other abuse situations
All abusers have their favorite tactics, and not all of them will get physical. I’ve seen stats where they say that financial abuse is present in 90% of abuse/domestic violence cases. Like most things, my guess is that it’s under reported. Because what’s the best way to control someone and keep them under your thumb as long as possible? Ensure they don’t have enough money. Another reason it’s under reported is that financial abuse can take many forms. And like most types of abuse, the behavior by itself can seem innocuous until you’re able to see a larger pattern.
Types of financial abuse
You have the more obvious forms of financial abuse:
- Preventing the victim from working
- Preventing the victim from accessing the marital accounts
- Placing the at-home victim on a strict allowance
- Accusing the victim of being financially incompetent (“Let me just handle that for you, dear.”)
- Not allowing the victim decision making power about financial decisions
- Hiding and moving assets
- Lying about the value of marital assets
- Spending marital assets on gambling, affairs, or other addictions
- Denying the victim access to their own separate assets and controlling or squandering these assets as their own
- Rerouting mail and transferring assets to their friends or family members
Less obvious forms of financial abuse
Other forms of financial abuse can appear innocuous until you pair them with other behaviors. These situations happen all the time:
- One spouse makes more money and maintains individual bank and investment accounts. Despite the large disparity in income, the household bills are split evenly making it next to impossible for one party to save while the other stockpiles assets.
- One partner buys extravagant things for themselves and prevents the victim and/or their children from having nice things because suddenly, the family doesn’t have enough money.
- The abusive spouse puts all the credit cards in their name. Then they monitor and grill the victim about every transaction. Or they don’t add the victim as an authorized user and keep them in the dark about balances.
- Or the reverse of the above. The credit cards are in the victim’s name only and the abuser racks up balances.
Financial abuse and divorce
In divorce, credit cards are frequently used as a weapon. In mine, the credit cards were largely in my name with my ex as an authorized user. We used the cards to buy groceries to earn points and then pay them off at the end of each month. I paid for the mortgage, car insurance, health insurance, utilities, internet, he paid for the groceries, water and garbage bill because he made a little less than I did. After I left him, but while we were still living in the same house, he would still use the cards to buy groceries. However, each month he would pay down less and less and less. Then he started charging bills he was responsible to the credit cards that were in my name. Which brings me to another form of financial abuse: getting the victim to spend down their assets.
What’s mine is mine and what’s yours is mine
I’d received a small inheritance. In my state, that’s not a marital asset as long as the funds are not commingled with marital assets. After I asked for a divorce, my ex ran up the cards in my name. I paid the balance down and then he racked up the cards again. Eventually, I figured out his game and didn’t pay it down again, but in the meantime the interest was piling up.
I worried that if I cut him off the credit cards, he would open more in my name. Added to that, I worried that if our assets were frozen, I wouldn’t be able to buy groceries for our kids much less pay my lawyer in our seemingly never ending divorce. I hoped that if I kept the balances maxed out, he would think I didn’t have any money and would lay off. Turns out: I was wrong.
People make bad choices when they’re sad or scared or stressed
When you’re under a tremendous amount of stress when going through a “high conflict” divorce, you don’t think as clearly or make the best decisions. Frequently those decisions are based on the short term. Mine certainly were. I could have tried to get the debt assigned to him, but it would have prolonged our already two-year-long divorce, cost more in legal fees, and still would have ruined my credit. Additionally, I would have to constantly be taking him back to court to get him to pay. Meanwhile I’d be getting calls from collection agencies and having to explain over and over again that the debt is not actually mine.
Paying to make it go away
By the end of our divorce I was ready to spend anything to get it finished. And that’s essentially what I did. With money I didn’t have. Short term, I got what I wanted, my freedom. Long term, like so many others before me, I faced a long road to restoring my financial stability.
Using the family court system to delay the case, rack up legal fees and suck the victim’s time and energy, taking them away from their jobs? That is another form of financial abuse.
Making money miserable
Some forms of financial abuse don’t prevent the victim from having access to money. The abuser just makes the entire experience around money anxiety inducing. My ex would go through every single grocery bag, item by item, asking me how much each thing cost over and over for the same item. He’d go through every item in the house I’d purchased and repeatedly ask me over and over how much each item cost. And a few weeks later he’d ask again repeatedly. After each item he’d complain that it was too expensive no matter what the cost was. I got to the point where I started telling him everything was half the cost of what I’d paid and still, he’d complain everything I purchased was too expensive.
My reactions to his harassing me about money looked like some of the items listed above. The credit cards were in my name. I have my own accounts. I made more money than him. But I was always reluctant to sit down with him and go over our balances because the experience filled me with anxiety. I’m not perfect and yes, like many people I spend too much at Target.
My ex would berate me about the balances. He’d constantly talk about how we didn’t have money and it was because I spent too much. Then in the next breath he’d complain that my shoes were old and I needed new ones because I needed to look nice and needed to consider my appearance. Or he’d announce that he’d just dropped $400 on a new PlayStation for himself.
He’d berate me for buying multiples of things. “We have so many phone chargers” he’d say. “Why’d you buy another one?” I’d reply that I had to buy another one because I couldn’t find any and if he would just put them back when he was done using them I wouldn’t have to buy more. Rinse and repeat, the same argument over and over with nothing ever changing.
I got to the point where I bought I hot pink charger and slapped a label on it saying, “Mom’s basement charger – leave here” so that I could charge my phone while I was working out on the treadmill. And still, it disappeared within a week or two. We had this argument over and over or different items around the house. We were halfway through our divorce when something he said finally clicked. He wasn’t completely irresponsible at all. He’d been purposely hiding various items from me because he KNEW that’d I’d get frustrated and go out and buy another one and then he’d have a reason to pick a fight with me. It was also a way to get me to spend down my money.
During our divorce we had a nesting agreement. When it was his turn, anything and everything of value started to slowly disappear from the house. And then in court he would accuse me of selling items from the house. I let the items go because as irritated as I was that the Keurig went missing when he wasn’t even a coffee drinker, I could replace that and it wasn’t worth spending $350 of my lawyer’s time fighting for it. I let a lot go because to me, with the exception of the wooden toy chests my dad had made for my kids, everything was replaceable. Replacing things that he clearly sold cost me down the line. But legal fees would have cost me too. Win/win for him because either way he was able to get me to spend my money.
It was awful, but as everyone says, it’s worth it. My divorce was a mess, but I learned a lot. It even helped put me on my present career path. I became a financial advisor here in Illinois because I didn’t want people going through what I had gone through.
Financial abuse abounds
In addition to my own experience as a financial abuse victim, I’ve had scores of clients tell me of their experiences.
One client I worked with was building her own business that has potential to eventually become pretty lucrative. However, in the meantime her husband earned significantly more than her. He kept those funds to himself. In addition to his day job, he also farmed. Like magic whenever she shared that she has managed to save up some money to help expand her business, he suddenly needed help. A tractor broke down that oddly cost just as much as she’d managed to save. Or the car broke down, or he needed to buy something else for the farm and needed to use her savings.
When he makes way more than you
Another client barely makes anything as a special ed teacher’s aid. Her husband, on the other hand, makes six figures. It’s a second marriage for both of them. He was burned financially by a previous marriage so they keep their bank accounts separate. They split the household bills 50/50. The first time we met and she was telling me about this, tears started welling up and it was clear that this was a frequent argument they had. He refused to budge and refused to take her wellbeing into consideration.
One mid-divorce client worked part time at the schools so that she could stay at home with the kids. Her husband made well into six figures and by all appearances they were easily living within their means. She took care of the household, he took care of their investments. She assumed, based off of his income and the number of years working, that splitting their assets would put her in a decent spot. When he finally complied with discovery, though, she found out that there was only 40-50k in his retirement account that needed to be split between them.
Draining finances to keep you down
Another’s husband ate up funds and even sank some of their retirement funds into a business that now never quite seems to make a profit. Something always happens to keep them in the red. It subtle enough that it might just be a coincidence. However, the emergencies always seem to happen when she’s considering leaving him. And of course she’s dealing with verbal and emotional abuse from him as well.
Another woman I know is still in the middle of her divorce. Her husband hid and moved their assets around so much starting years before she asked for a divorce. He of course, has not been complying with the discovery process. They’d sold a house a few years back for a substantial profit and have been renting since. Her soon to be ex-husband makes a good income that more than covers their monthly expenses but insists that the money from the sale of house is gone. When she asked where it went, the answer is vague. She’s a stay at home mom working to finish her degree with no income and a young daughter to care for. Hiring a forensic accountant to track down the assets costs money that she doesn’t have and at the end of the day there may be no recovering the funds.
Anyone can be a victim of financial abuse
I’ve met with clients and talked to a lot of women in similar positions. Some men too. It doesn’t matter if you’re smart, if you have a good education and start with your own money. Your socioeconomic status doesn’t matter. Abuse tends to seep in slowly and gradually builds over time. People attempting to exert their control over others, e.g. abuse, is incredibly common. 1 in 3 women and 1 in 6 men deal with some form of abuse in their lifetimes. Reactive abuse and the lengths that some abusers will go to in order to hide who they truly are can make it extremely difficult to determine who is the issue in family court. The best way to prevent financial abuse is to know the signs and spot it early. And the way to know the signs is to talk about it.
Call or go online for help
Call the National Domestic Violence Hotline on 1800 799 7233 or text “START” to 88788