The new kind of STD affecting thousands of Australian women.
Navigating relationships and all of its their challenges can be a difficult task, and it becomes even more difficult when one person is financially reliant on the other.
This responsibility of one partner for another’s financial debts is what defines sexually transmitted debt, and usually occurs when one person is convinced or misled to take on debt in their name or take on more risk than they were aware of at the time knew about.
This can take the form of bills, mortgages or loans. For example, a couple have been together for nine months. person A wants to buy a car, but they can’t because they have a bad credit rating, so person B takes out a loan in their own name for them, but the car is registered in the name of person A only. Then, when the couple breaks up, person A takes off with the car, while person B is left to repay the loan.
Women in particular are often vulnerable to this accrued debt, especially if there is already an inherent power imbalance in the relationship. This, paired with the fact that ‘the money talk’ is often an avoided discussion, often results in financial surprises.
While the topic of money and finances can be a difficult one to have, especially during the initial phases of a relationship, the financial risks of not having it are even greater if the relationship breaks down or one person takes advantage of the other.
However, this kind of STD is not always done with malicious intent. The other side of sexually transmitted debt occurs when one partner’s poor credit rating affects the efficacy of any kind of shared asset. The most common example of this would be when couples try to take out a shared loan, but are rejected due to one partner’s credit score.
So how can you avoid this STD?
Think twice about opening a joint bank account
While opening a joint bank account often seems like the next logical step after moving in together, there are a bunch of risks associated with giving another person access to your wealth and finances, and so should be thought about seriously before you jump into it.
The main risk of course, is that if the account is registered in both of your names, then you become responsible for any debt that the other person accrues – regardless of whether you had anything to do with the spending. Not only does this debt weigh heavily on your wallet, but it can also lead to a strain on your financial history and affect your financial prospects moving forward.
The other risk is the loss of privacy that occurs with a shared account, as both partners can see every transaction that is made, which could lead to issues and conflict later on.
While joint bank accounts won’t necessarily lead to financial abuse or manipulation or the draining of all of your money, financial experts such as The Commonwealth Bank recommend that if you have one or more joint accounts with a partner, that you still have your own bank account that is separate. In fact, a study by Experian in the US in 2016, reported that 20% of men and 12% of women have secret bank accounts.
Know Your Partner’s (And Your Own) Debts
As mentioned above, the other side of sexually transmitted debt, is when one partner’s debt affects the financial opportunities of the other or the couple together. In The Experian study mentioned above, among newly married couples 40% of people were unaware of their new spouse’s credit score.
For this reason, it is important to have complete transparency when it comes to maintaining financial wellbeing in the beginning a relationship.
In a committed, long-term relationship you are both entitled to, and encouraged by financial advisors to enquire about your partner’s spending, bills and debts – especially if you have or plan to have any shared assets.
Inform your provider if you break up
When you’re in the midst of a relationship, it’s hard to consider that the coupling may not last forever. But if you do break up, telling your bank or provider is probably at the bottom of your priority list.
However, it is essential that you tell your providers (and bank) immediately if your living situation changes so that direct debits may be directed elsewhere, and your name can be taken off of other payments.
Overall, there is no right way to manage your finances, but it is important – particularly as women – to get ahead and be savvy with their your money so that you don’t end up at risk of sexually transmitted debt or financial abuse.