Ask an advisor: Does my client need a financial planner or a marriage counselor?

December 7, 2022 7:15 PM

Couples' financial problems are sometimes beyond the scope of a financial advisor.

Welcome back to "Ask an Advisor," the advice column where real financial professionals answer questions from real people. The topic can be anything in the world of finance, from retirement to taxes to wealth management — or even advice on advising.

This week, we're taking a different approach: Our question comes not from an investor, but from an advisor. A certified financial planner in Virginia tells us he's been advising a married couple to the best of his abilities, but he's beginning to wonder if their problems go beyond his purview. One spouse is handling money in a way that not only violates their financial plan, but raises questions of marital trust and honesty.

As various advisors responded, one term that came up again and again was "financial infidelity." While definitions vary, the term generally refers to a situation where someone lies or keeps secrets about money from their significant other. It's a behavior that can break relationships — according to one recent study, 42% of U.S. adults think financial infidelity is just as bad as "physical cheating."

So is this problem just about money, or something deeper? Here's what our CFP in Virginia wrote:

Dear advisors,

When do you draw the line between a couple's need for an advisor or a marriage counselor?

The example I am encountering is that I have been working with a household where we all agree on the action items of a plan, but then one spouse continues to go off and do their own thing with the household finances. I'm talking about taking out six figures in personal loans in order to place options trades to make up losses from prior options trades that didn't pan out. Our meetings started as creating a unified vision and set of goals for the family and implementing action items. Over time it has turned into navigating uncomfortable conversations when the other spouse and I find out about the personal loans at the same time. We are having more conversations about marital trust than about their finances and I am beginning to think we are at that point. I welcome your thoughts.

—Not a financial therapist

And here's what advisors wrote back:

Time for a marriage counselor

Noah Damsky, chartered financial analyst and principal at

Marina Wealth Advisors

in Los Angeles, California:

Sometimes the line between needing a financial advisor or a marriage counselor can get blurry. In the case of your question submitted, it's clearly a need for a marriage counselor. When it comes to issues of infidelity — in this case, financial infidelity — then there are deep-rooted issues facing the couple. They need to reestablish trust and communication, first and foremost, before they can heal their financial situation.

Get to the root of it

Daniel Yerger, certified financial planner and president of

MY Wealth Planners

in Longmont, Colorado:

The key distinction between a need for financial planning, marriage counseling, or financial therapy, comes from what you observe to be the cause of the problems. When clients come to us for financial planning advice, their problems are usually financial in nature. Concerns about the market, paying too much in taxes, looking for guidance on how to best leave a legacy, and so on.

When the conversation you have with them is manifested through financial misbehavior, that doesn't necessarily mean that the problem is financial, but that it's an expression of conflicts in the relationship, issues with communication, or ingrained money scripts. You have to determine whether their real problem is behavioral (which no amount of financial planning can solve) or financial; if it's behavioral, then it's time to send them to a therapist.

This is addiction

Kenneth Waltzer, MD, CFA, CFP, neuropsychologist and co-founder of

KCS Wealth

in Los Angeles, California:

In this case, even more than a marriage counselor for the couple, what's needed is a therapist to deal with the options trader's gambling addiction. Neither the financial advisor nor a marriage counselor is equipped to deal with what appears to me to be a clear case of trading addiction that can only be dealt with through addiction-focused therapy. As the individual is likely not yet willing to face up to the likelihood that they have an addiction, the referral could be difficult and likely refused. Perhaps the best approach is to recommend a marriage counselor, let that therapist know what the issue is, and have the marriage counselor then refer the addicted party to the right therapist. This is going to be a long haul and could well end in divorce even with the best of intentions.

Cleanup is not enough

Jeremy Bohne, MBA, founder of

Paceline Wealth Management

in Boston, Massachusetts:

When a couple needs help making a big financial decision, specifically from a technical standpoint, they need a financial advisor.

But when a couple is trying to sort through the consequences of a financial decision, and especially where one partner was an unwilling participant, this requires a marriage counselor.

In this case, an advisor may be able to help clean up the mess, but not the underlying issues that would prevent this from happening again.

Know your limits

Jay Zigmont, PhD, CFP, founder of

Childfree Wealth

in Mississippi:

First, the details of your question go much deeper than the debate of an advisor or marriage counselor. Much of what you described combines financial infidelity and conflicting financial values. While in my practice I would have no issues coaching around this, that does not mean you should.

The better question is, do you want to deal with it? This couple is an opportunity to build your planning and conflict resolution skills if you want to. It may also be out of scope for your practice, and that is okay.

Chances are the couple needs both an advisor and a marriage counselor. That can be one person or two, but they need help. The bigger question would be if they are ready for it.

You can help ... by recommending help

Ryan Phillips, CFA, CFP, founder of

GuidePoint Financial Planning

in Reston, Virginia:

When you get to the point that you ask yourself if it's time to refer a client to another professional, it probably means that it is. The clear-cut question that you have to ask yourself is: Do you objectively feel you are the person who is best able to help them?

Issues that you are detailing, such as compulsive spending and marital communication and trust, are likely outside of what you can do under your professional engagement. However, just being able to thoughtfully make this recommendation to them is of great benefit. It may take more than one time making the recommendation. The important thing is communicating that you care and that you want to help but you believe there is a different professional that will be better able to assist.