Ask an advisor: Does my client need a financial planner or a ... - Financial Planning
Welcome back to "Ask an Advisor," the advice column where real financial professionals answer questions from real people. The topic can be anything in the world of finance, from retirement to taxes to wealth management — or even advice on advising.
This week, we're taking a different approach: Our question comes not from an investor, but from an advisor. A certified financial planner in Virginia tells us he's been advising a married couple to the best of his abilities, but he's beginning to wonder if their problems go beyond his purview. One spouse is handling money in a way that not only violates their financial plan, but raises questions of marital trust and honesty.
As various advisors responded, one term that came up again and again was "financial infidelity." While definitions vary, the term generally refers to a situation where someone lies or keeps secrets about money from their significant other. It's a behavior that can break relationships — according to one recent study, 42% of U.S. adults think financial infidelity is just as bad as "physical cheating."
So is this problem just about money, or something deeper? Here's what our CFP in Virginia wrote:
Dear advisors,
When do you draw the line between a couple's need for an advisor or a marriage counselor?
The example I am encountering is that I have been working with a household where we all agree on the action items of a plan, but then one spouse continues to go off and do their own thing with the household finances. I'm talking about taking out six figures in personal loans in order to place options trades to make up losses from prior options trades that didn't pan out. Our meetings started as creating a unified vision and set of goals for the family and implementing action items. Over time it has turned into navigating uncomfortable conversations when the other spouse and I find out about the personal loans at the same time. We are having more conversations about marital trust than about their finances and I am beginning to think we are at that point. I welcome your thoughts.
—Not a financial therapist
And here's what advisors wrote back:
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