Is your mate hiding money? 10 ways to tell

By MP Dunleavey

I've been hearing about a lot of women lately who hide money from their spouses. And they have no desire to tell 'em, either.

These aren't the financially dependent women of yore, who relied on their husband's salaries (and whose only financial cushions in case of divorce, illness or emergency were these secret nest eggs). These are modern, working women -- some with families, some without.

One woman I know calls the several thousand dollars she has squirreled away her "security blanket." It's not an escape route (she and her hubby are happily married). Nor does she think he would mind if he knew about it. She's just afraid he'd want to spend it -- and she likes being able to pay for extras for herself and the kids. Another woman has a fascinating "don't ask, don't tell" policy with her spouse. After they pay the bills, he doesn't ask what she does with the money she earns and she doesn't tell him.

But this isn't about women hiding money from men (although a survey by British online bank Cahoot.com found that about 75% of women admitted to hiding money, compared with 53% of men). It's about the fact that both genders hide money from their mates, and how you can tell -- and when you should care -- if it happens to be your partner.

Don't jump to conclusions

If you're suspicious that your mate is holding out on you, your best bet is to calm down, says Violet Woodhouse, an attorney in Newport Beach, Calif., who specializes in divorce -- the event most likely to reveal who has been hiding what from whom. Although hiding money is certainly something that happens, she says, "I disagree that it's that common."

Far more prevalent, she says, is one partner's perception that they are being deceived. But in most cases, that suspicion turns out to be more paranoid than true. The partner who thinks there's missing money is often the one less involved in the couples' finances to start with. "They do the spending, but not the financial management," Woodhouse says. "So they don't know what the big picture is."

Richard Barry, a matrimonial lawyer in San Rafael, Calif., and a former president of the American Academy of Matrimonial Lawyers, agrees that hiding money isn't as common as people believe. He's been specializing in this field for three decades, and as more women have become financially secure in their own right, he says he's seen fewer instances of either spouse hiding money.

Besides, he points out, "It's harder to do than one supposes. To hide money, you almost have to hide it in cash, literally under a mattress, if you really don't want it found."

Anthony Fava, a New York tax accountant, adds that it's almost impossible for one spouse to siphon off a big chunk of income without the other spouse noticing. In order to set aside serious money, he says, you'd have to be doing it over a long period of time -- and most people have no reason to be that deceitful.

(Although I love the story Ginita Wall, a San Diego CPA, told me about the client who managed to save $250,000 over the course of her 45-year marriage by squirreling away her household allowance. I should be so squirrelly!)

So how do you hide money, anyway?

Still, that doesn't mean hiding money is uncommon. Fava says he typically sees two types of secret accounts. The first is the war chest. "It's when the couple knows the writing is on the wall," he says. "It's done just before a divorce or separation, or during the breakup."

Fava isn't a big fan of this strategy. "I've had clients who obviously just socked away some money in an account. That isn't the answer -- any smart lawyer or private investigator can find it. But if a person is ingenious, there are ways to hide money from a spouse."

Gold ingots require quite a bit of cash -- and they fluctuate according to the gold market (which recently hit a six-year high). But because you don't have to give your Social Security number when you purchase them, they don't leave a tax trail.

The second type of secret account is more innocent. Usually a couple will come in to have their taxes prepared and later one spouse will call and confess a secret account, asking the preparer to discreetly add in the interest or dividends. The amount they're hiding is typically only three or four thousand dollars, and men are as likely to do it as women, he says.

And why hide a few thousand dollars? "I have so much work crossing my desk, I don't usually give it much thought," Fava admitted. "If I had to speculate, I'd say -- it's probably crazy money, fun money. I don't think there's any malicious intent."

Hiding money ain't all it's cracked up to be

Whether or not you could or would or do hide money from your significant other, there are a few things to think about.

Many people don't get to keep the money they've hidden. Since most people who hide money do so in anticipation of a divorce, "A lot of times that hidden money just ends up paying the lawyers," says Wall.

Continued: Signs, warnings, clues and red flags

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