The CFO Spouse

By: Jack Strulowitz

My wife is an amazing mother, an incredible cook, and she keeps our house organized in a way I never could. There is, however, one chore she can’t stand: sweeping. I, on the other hand, don’t mind it. I almost enjoy it. So after we got married, naturally it became my chore. Most good marriages run on arrangements like this, where each person picks up what they’re good at or happen to enjoy or tolerate, and the home runs better for it.

Handing the finances to one spouse can work the same way, and there’s nothing wrong with that. What matters is what the other spouse knows. My wife has no need to know which crumbs I swept on Tuesday night, but she does need to know where our accounts are held, which bills come out each month, what our estate plan says, and who to call about our life insurance. The problem is, many times this information is not written down, but stored in the “CFO spouse’s” head.

In most of the households, the husband is the one handling the finances, which is what most people would expect. However, in plenty of households it’s the wife who manages the finances. Whatever the financial arrangement, the result usually looks the same: one spouse knows the full picture, while the other knows enough to get by.

Now picture what happens if the spouse who holds that picture passes away suddenly. Within a couple of weeks, the bills start coming due. Many statements are paperless and go to the other spouse’s email, so the survivor may not know which accounts and credit cards even exist, and all the verification codes are being sent to the wrong cellphone or to an email account they cannot access. Some bills are on autopay and need to be cancelled, while others are paid manually via online accounts with unknown passwords and are now past due. The CPA calls asking for documents the survivor has never heard of, the life insurance company needs a claim nobody knows how to file, and the estate plan needs updating by someone who never read it in the first place.

When I ask couples why only one of them knows how things work, the honest answer is usually that the spouse handling the money never really opened the door. For some it is a bit of insecurity. Most people managing their family’s finances are not professionals, they know it, and they would rather their spouse not see the mistakes they might have been making, whether with an old account they never consolidated or an investment they held onto too long.

For others, it’s a matter of pride, a sense that they have it handled and there is no reason to involve anyone else. And for many it is simply tradition, because that is how it worked in the house they grew up in, where one parent took care of the money and the other never asked. But that tradition doesn’t have the best track record. Many of us have watched it play out with a grandfather who ran everything for fifty years and a sweet old bubbe who, after he passed, had no idea how to pay the property taxes.

A Kansas State University study found that arguments about money were the top predictor of divorce, even after accounting for income, debt, and net worth. The strain usually comes from how a couple talks about money, regardless of how much they have. Each spouse brings their own relationship with money into the picture, including how much risk feels comfortable, what is worth spending on, and what counts as enough. The goal is one approach for the household that still leaves room for both, and that is very hard to build when only one person is at the table.

Most couples simply never get around to sharing this because reviewing the family finances is boring at best and uncomfortable at worst. Sometimes all it takes is opening a nice bottle of wine and sitting down to review your account statements together. The spouse being left in the dark gets brought into the light, and the CFO spouse gets what’s likely a much-needed refresher.

For couples who need a little more structure, a third person in the room can help. Some of the couples I work with need very little in the way of planning. What they need is a joint meeting once or twice a year, where we review what is coming in, what is going out, and a full snapshot of their net worth and estate plan. Both spouses leave knowing the same things, and the one who was in the dark finally knows where to look. n

Jack Strulowitz is a Financial Advisor at Bernath & Rosenberg in Cedarhurst, NY, where he helps high–net worth individuals and families manage their investments and build comprehensive strategies for retirement, tax, and estate planning. For questions or to schedule a consultation, please contact [email protected] or 212-221-1140 ext.129.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

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