The survey, analysing attitudes to and conversations about money among co-habiting couples aged over 40, finds that one in eight (13%) have debts that they have not disclosed to their partners. The average value of these hidden outstanding debts is £7,800 per secret debtor. Women (14%) are slightly more likely than men (12%) to keep quiet about their borrowing.
Meanwhile, nearly one in five (18%) over-40s in relationships have secret savings and investments stashes worth an average of £20,800 . And more than a fifth (22%) do not know how much their partner has accrued in pension savings.
Prudential also found that many couples fail to disclose their true earnings to each other, with 14% admitting that their partners do not know how much they earn. Around a quarter (28%) of those who keep some or all of their earnings secret say that they do so to maintain their independence.
Vince Smith-Hughes, retirement income expert at Prudential, said:
“Couples looking to secure their financial futures should be very wary of keeping elements of their finances secret from each other. The reasons for keeping quiet may seem perfectly valid, and coming clean may result in some awkward conversations, but it is important for couples to have a full understanding of their joint financial circumstances when planning for the future.
“For example, couples who are keeping separate secret stashes of savings with the intention of funding their retirements could be missing out on vital pensions tax relief. Alternatively, couples approaching retirement, unaware of their partners’ debts, could be in for a nasty shock if they haven’t been cleared when the time comes to give up work.
“Ideally, a couple looking to secure the best possible income in retirement will have a conversation about the savings and investments they both hold. A further conversation with a professional financial adviser or retirement specialist should also help with the decisions that will need to be made when turning these savings and investments into retirement income.”
When asked how their secret debts arose, many of those with debts say that they have come about as a result of day-to-day life – 56% cite general living costs as the main cause of their debts. However, nearly one in five (18%) attribute their secret debts to overspending due to previous relationship break-ups and other emotional upheavals.
When it comes to secret savings stashes, there are interesting differences between men and women. Men (22%) are more likely to have secret savings and investments than women (16%), while 24% of female secret savers say they are keeping the money hidden to provide financial security in the event of a break-up compared with 11% of men. Three in 10 (29%) women will use the cash to help fund their retirement compared with one fifth (20%) of men.
There are, however, often simple explanations for partners keeping money secrets from each other. Nearly one in four (22%) of those who don’t tell their partner the full story about their income are planning to use the cash to buy presents for their other half, while another 22% admit to planning for a major purchase such as a dream holiday or new car.
