Financial abuse is a form of domestic violence that often goes unrecognized and yet can have a significant impact on individuals’ lives. In this blog post, we delve into the topic of financial abuse, shedding light on its definition, exploring various examples, and highlighting a real-life scenario. By raising awareness, we hope to empower those affected to recognize the signs, seek help, and break free from this insidious cycle of control.
What is considered financial abuse?
Financial abuse, also called economic abuse, involves the misuse or control of financial resources by one person to exert power and control over another in a relationship. It is characterized by tactics that limit the victim’s financial independence and decision-making abilities. Here are some common forms of financial abuse:
Controlling Finances
The abuser takes complete control over the victim’s finances, denying them access to bank accounts, credit cards, or any financial information. They may closely monitor and restrict their spending, making them financially dependent.
Withholding Funds
The abuser intentionally withholds money from the victim, preventing them from meeting basic needs, such as food, shelter, and healthcare. They may refuse to contribute financially or provide an inadequate allowance, creating a power imbalance.
Coerced Debts and Exploitation
The abuser may coerce the victim into incurring debts or loans, making financial decisions without their consent. They might exploit the victim’s assets or steal their identity for personal financial gain.
What are examples of financial abuse?
Financial abuse can manifest in various ways, leaving victims feeling trapped and vulnerable. Here are three examples that illustrate the depth of this issue:
Forced Economic Dependency
The abuser isolates the victim from work or educational opportunities, making it challenging for them to earn a living or become financially independent. They may also threaten or sabotage their employment, limiting their access to financial resources. This can take the form of the abuser calling up or communicating with the victim’s employer and they would make up excuses or stories to get the victim fired.
Sabotaging Credit and Financial Stability
The abuser intentionally damages the victim’s credit by running up debts in their name, refusing to pay bills, or deliberately defaulting on joint financial obligations. This tactic not only destroys the victim’s financial stability but also affects their future prospects.
Economic Blackmail
Sometimes, in economic abuse, the abuser uses financial resources as a means of control by threatening to withdraw support or resources if the victim does not comply with their demands. This coercion perpetuates fear and maintains a cycle of dependence on the abuser.
Identity Theft and Financial Exploitation
The abuser may steal the victim’s personal information, such as social security numbers or bank account details, and use it to gain unauthorized access to their financial resources. This theft can lead to significant financial losses and long-term consequences for the victim.
Forced Financial Isolation
The abuser isolates the victim from their social support network, making it difficult for them to seek help or access financial assistance. By limiting their access to friends, family, or community resources, the abuser further reinforces their control over the victim’s finances.
What is a real-life example of financial abuse?
Real-life instances of financial abuse help us understand the devastating impact it has on individuals’ lives. Consider the following scenario:
In a marriage, one partner, Jack*, controls all the finances, including joint accounts. He monitors his wife, Sarah’s*, spending meticulously, scrutinizing every transaction and demanding receipts to justify her purchases. Jack restricts Sarah’s access to money, giving her a meager allowance that barely covers basic necessities. He constantly reminds her of her financial dependence and threatens to cut off her access to funds if she questions his authority.
Furthermore, Jack manipulates Sarah into taking out loans and credit cards in her name, exploiting her trust and financial vulnerability. He accumulates debt under her name, leaving Sarah burdened with the financial consequences and a tarnished credit history. Jack uses this debt as a tool to further control Sarah, reminding her that she is indebted to him and must obey his every command.
Sarah’s options for seeking help are limited. Jack has successfully isolated her from her friends and family, ensuring she has no support system to turn to. She feels trapped and helpless, believing she has no way out of the toxic cycle of financial abuse.
This real-life example highlights the insidious nature of financial abuse. It is not merely about money; it is about power, control, and manipulation. Victims of financial abuse often suffer in silence, facing immense emotional and psychological trauma alongside the financial constraints imposed upon them.
This situation mostly also happens when there is an imbalance of power in the relationship. In another case, one partner can be the sole breadwinner. And because that partner may feel the most entitled to the money, he or she may limit the access of the other partner to money.
Let’s look at another example. Recently, there has been a lot of talk about “passport bros” and these are usually men from developed countries. They are called such because they go to less developed countries to find women who are willing to get into a relationship with them. They promise them money and financial stability once they marry. Of course, having a chance at citizenship and a better or more stronger passport is another promise, hence the term. This isn’t really a mail-order bride situation as some of them really do find love and compatibility with some of these women.
However, we have to acknowledge that there is a power imbalance here and the women from the less developed country may be desperate to get out of their financial situation, especially if this is their only reason to be in the relationship. On the surface, this may seem like a fair exchange – women get the financial stability and in other cases, even a chance at another citizenship. For the men, they get love and partnership. But what happens when conflicts arise? What happens when there is a feeling of boredom or jealousy in the relationship? Though these are normal challenges in any relationship, in a situation where there is a power imbalance due to money, the dynamics can be different and tricky. We can even see some examples that are popularized by TV shows such as 90 Day Fiancé. Though some relationships work out, some don’t and this power imbalance is a factor.
What can you do if you’re experiencing financial abuse?
Financial abuse is a devastating form of control that can leave victims feeling trapped and powerless.
By understanding the various forms of financial abuse and recognizing the signs, we can support those affected and help them break free from the cycle of control. The first step is really educating ourselves. You may check out websites such as this resource on financial abuse by Annuity.org, an organization that helps educate people about their financial options and empower them to make informed decisions. They also encourage women to be financially literate to avoid being in a situation where they can be financially abused.
Of course, men can also be victims of financial abuse especially if their partners are the higher income earner. And there are also groups such as Respect in the UK that advises men regarding this situation too.
But the point is to identify it as early as possible as there are studies stating that financial abuse is also present or can lead to other forms of domestic abuse. In fact, 99% of women who were reported to be experiencing physical abuse also reported to be undergoing financial or economic abuse.
It is essential to raise awareness, promote education, and provide resources for individuals to seek help and reclaim their financial independence. Together, we can create a society that stands against financial abuse and supports survivors on their journey toward healing and empowerment.