Financial abuse is an often hidden form of domestic abuse, where one person exerts control over another’s access to money and resources. It can happen to anyone, regardless of age, gender or socioeconomic status. Financial abuse leaves victims powerless, unable to escape harmful situations due to a lack of financial independence.
Recognising the signs of financial abuse in your loved ones is crucial, as those affected may not even realise they’re being controlled or exploited. By identifying these red flags early, you can help support friends and family who might be suffering in silence.
What is Financial Abuse?
Financial abuse involves controlling a person’s ability to acquire, use or maintain money. This might include preventing them from working, limiting access to bank accounts or forcing them to account for every dollar spent. The abuser might also run up debts in the victim’s name, steal from them or control how they spend their income.
Unlike physical abuse, financial abuse often leaves no visible marks, making it harder to detect. However, the emotional toll and the lasting damage to a victim’s financial security can be just as severe.
- 23% of women and 14% of men have experienced partner emotional abuse1
- 16% of women and 7.8% of men have experienced partner financial abuse1
- On average, one woman a week and one man a month were killed by a current or former partner2
What are the signs of Financial Abuse?
Here are some common indicators of financial abuse. If you notice these in your friends or family, it may be time to start a conversation or seek help on their behalf:
- Limited Access to Money
One of the most telling signs of financial abuse is when a person has little or no access to their own finances. They may need to ask for money for basic necessities, be refused access to joint accounts or even have their credit cards and bank cards taken away. - Unexplained Financial Struggles
If someone you know is suddenly struggling to pay bills or meet everyday expenses despite working or having previously stable finances, this could be a red flag. Their partner may be restricting access to funds or siphoning money away without their knowledge. - Being Pressured Into Financial Decisions
A person experiencing financial abuse might feel pressured into making financial decisions they’re uncomfortable with—such as taking out loans, signing documents, or giving control of their assets to their abuser. If they seem uneasy discussing their finances or are hesitant to share details, this could be a sign of manipulation. - Lack of Financial Knowledge
An abuser may deliberately keep their partner in the dark about their own financial situation. If someone you care about seems unaware of their income, expenses, or how their finances are managed, they could be a victim of financial abuse. - Excessive Monitoring of Spending
When a person is forced to account for every penny they spend, it’s a major warning sign. This kind of obsessive control can make a victim feel like they have no freedom over their own life. If your loved one seems overly stressed about how they spend money, or has to “report” their spending, it’s time to take notice. - Accumulation of Debt
A more hidden sign of financial abuse is the accumulation of debt in the victim’s name. This might occur through forced credit card usage, loans taken out without consent, or unauthorized withdrawals. A victim may be left to deal with mounting debt, which damages their credit score and makes financial independence even harder to achieve.
How does financial abuse affect victims?
The effects of financial abuse reach far beyond bank accounts. Victims often feel isolated, ashamed, and powerless. Without financial independence, leaving an abusive relationship can feel impossible, trapping them in a cycle of dependence. Long-term financial damage, such as poor credit or unmanageable debt, can also affect their ability to rebuild their lives even after the abusive relationship has ended.
It’s important to remember that financial abuse isn’t always obvious to the victim or those around them. Many people may not recognize the patterns until they’re in a position where they feel trapped, with no way out.
How can you support someone experiencing financial abuse?
If you suspect a friend or family member is experiencing financial abuse, it’s important to approach the situation with sensitivity. Here are some ways you can help:
- Start a Conversation: Gently ask your loved one about their financial situation. Let them know you’re concerned and there to support them without judgment.
- Provide Resources: Share information about financial counselling, domestic violence support services and legal advice.
- Offer Emotional Support: Sometimes, just being there for someone, letting them know they’re not alone, can make a huge difference.
- Encourage Independence: Help your loved one take small steps towards financial independence, whether that’s opening a separate bank account or getting professional financial advice.
Conclusion
Financial abuse is a serious issue that can have long-lasting repercussions. By being aware of the signs and knowing how to offer support, you can help break the cycle of abuse and empower victims to regain control of their lives. Remember, it’s not just about money—it’s about freedom, safety, and well-being.
For information, counselling or support, call 1800 RESPECT (1800 737 732).
We’re also here to help. If you or someone you know needs help with their financial situation, contact us today.
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The information provided in this communication has been issued by Sherlock Wealth Advisory Pty Ltd (AFSL 558532).
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