Are your clients hiding money from their spouses?

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Consumer research into the financial behaviour of Australians has found that an equivalent of 300,000 married and de facto couples admit having secret bank accounts without the knowledge of their partner.
 

The research, conducted by TAL Life Insurance, found while 66% of couples have joint bank accounts, a large percentage also have their own independent finances – with many having secret stashes.
 
A total of 45% of married or de facto people have a bank account to which their partner has no access (36% married but 71% of de facto couples) and 3% have accounts their partners are not even aware of.
 
The average amount held in these secret accounts is $30,000 to $37,700 for males and $22,300 for females. Eleven per cent has more than $100,000, 13% contain between $50,000 and $99,999, 25% have $50,000, and 39% have less than $5000.
 
TAL Group CEO Jim Minto was surprised so many people had secret accounts, with one out of five people saying they maintained these covert accounts as a safety-net in case something happened.
 
“While we may not know the precise motivation behind all these secret bank accounts, such accounts are no substitute for proper financial protection in the event one’s income suddenly stopped for good or for an extended period as a result of illness,” Minto said.
 
“We know that people have their own financial goals, or that their attitudes to money might not always be compatible with their partner, so there can be some very good reasons for keeping money and life insurance protection separate. 
 
“But for life insurance planning a shared approach can make a lot of sense when there are joint debts such as mortgages and other shared responsibilities such as children. Ensuring the family has the right amount of cover is very important, and a financial adviser is a great place to start.”
 
The survey was undertaken online by Galaxy Research with 1,260 Australians between 18 and 69 years old.
 
  • Baby boomers (those over 50 years old) are more likely to be keeping their secret stash in case something happens – 30% report this as being the main reason compared to 15% of other age groups.
  • While the average balance of a secret account is $30,000, Aussies are stashing $18,400 in accounts their partners do not have access to but know about. Men averaged a balance of $21,100 in these accounts versus $16,600 for women.
  • Of the separate but known accounts, 8% or the equivalent of 303,000 people have more than $100,000.
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