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And if you live in a community property state, unless you've truly hidden your assets in such a way that they can't be found, your spouse will get half of them anyway -- at least. Woodhouse recalled a well-known case in California, where the wife divorced her husband after she won the lottery. She hadn't told him about her winnings, so the judge declared it a fraud and gave her husband everything.
Sounds harsh, but Woodhouse believes it was just. "We are fiduciaries to each other. Everyone is accountable."
Woodhouse believes that even spouses who salt away just a little fun money should reconsider their motives. There's nothing wrong with having your own account, she says, but there's a lot wrong with hiding it from the person who otherwise shares your home and heart. "It's an issue of respect," Woodhouse says. "(You're) entitled to keep a separate account -- and claim sovereignty over it."
But secrecy only seems to lend autonomy. True respect for each other's financial needs can only be achieved through direct and honest communication. Otherwise, Woodhouse says, "You're just diverting assets away from the marital good."
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Signs, warnings, clues and red flags
Let's say your spouse has a little more socked away than three or four thousand dollars. How would you know?1. The tax tip-off: Check your tax return first. Do the numbers correspond to what you've earned, spent and saved? Do the 1099s seem to be in order? Interest and dividends are reported there, along with the names of the financial institutions. Hint: If you don't know where your assets are invested and where the accounts are kept, this would be the time to find out.
2. Chronic cash crunch: If your partner is suddenly, chronically short of cash, or if their $200 per week ATM withdrawal doubles, that could be a sign.
3. Rebound reticence: There is a greater incidence of hiding money in second and third marriages. People have been through their first divorce and they think they got the worse end of the deal -- as most usually do -- and they don't want it to happen again.
4. Big changes: Any dramatic changes in the way family finances are handled. Did that joint savings account suddenly disappear? Was there a piece of a stock portfolio that 'got rolled over' into something else?
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6. Defensiveness: If you ask about your joint finances and your partner responds dismissively or defensively, that's often a red flag. It's your money, too, and you're entitled to know about it.
7. Obfuscation: Your spouse likes to keep control of the finances -- and keep you in the dark. One example: He or she wants you to sign the tax return three seconds before they dash to the post office.
8. Tapping the budget: Unexplained cash advances or big grocery tabs. Is someone getting large chunks of cash back? You might want to inquire.
10. Mail delivered elsewhere: Does the mail come to your home? If not, that could be a red flag that your spouse doesn't want you to see certain incoming statements.
Updated June 2, 2009
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