12 Steps to Protect Your Finances When Leaving an Abusive Relationship
Note: This article doesn’t contain any depiction of physical or sexual violence, but does detail financial and emotional abuse in relationships.
Lisa Orban was married to her abuser for three years. In 1990, she left after he threatened to kill her and their two young children.
She was 20 years old.
Her financial situation in the marriage? “Bad, in a nutshell,” she recalls.
Not unusual for the time, her husband was the main breadwinner, and he managed the finances.
“Whenever there was a chance that I might make enough money or make more money than him or do anything to upset his financial apple cart, so to speak, he would come in and sabotage it.”
She lost multiple jobs because of his meddling.
She moved with him from her hometown in Illinois to Arizona for college, where she’d won a four-year scholarship to study psychology. Before she could start, he contacted the university and told them she’d decided to drop out.
“Imagine my surprise when I go to registration day and find out that my scholarship is gone,” she says.
He even had control of the mailbox. He took her key, though she thought she’d just lost it, and put off replacing it. That had major, unexpected financial ramifications.
“It wasn’t until after we were divorced that I found out that I had not paid off my student loan.” The $4,000 loan ultimately cost her $38,000 to repay, she says.
The checks Orban thought were going into the mail were not, and the missed payment notices from her loan providers weren’t getting to her.
He kept control of the checking account.
He wouldn’t let her use the car alone.
He knew how much money she earned, and he would accompany her to the bank to deposit her paychecks.
He signed up for credit cards in her name.
By the time Orban left and filed for divorce, she was $80,000 in debt and didn’t even know about it.
What is Financial Abuse?
About 1 in 4 women and 1 in 7 men will experience severe intimate partner violence in their lifetime, according to a Centers for Disease Control and Prevention report.
Domestic violence and abuse comes in many forms, whether it’s physical, emotional, psychological or sexual — but it can also be financial. Likely, it’s some mix of these, but not always all of them.
Of those who experience violence, 98% also experience financial abuse.
“Like all abuse, financial abuse takes a lot of forms, but it’s all controlling behavior; power and control,” explains Casey Harden, interim CEO of the YWCA USA. “Imagine tightening the reins on the financial condition of the home, so that there’s limited options.”
Abusive partners may leave you out of major decisions and purchase a home that’s well out of your family’s budget, for example. They may run up credit card debt without their partner’s knowledge or input, lie about paying bills or damage valuable property.
In addition to safety concerns, victims of domestic violence often stay in abusive relationship because of a lack of financial resources.
“Many survivors, even after they’ve left, often return because of finances,” says Kim Pentico, director of the Economic Justice Program at the National Network to End Domestic Violence.
Michelle Kuehner, a survivor of domestic violence who is now a financial advisor and author of The Money Diet blog, explains:
“More often than not, the abuser has made the victim feel as if they are dependent upon the abuser. That without the help of the abuser, the victim could not survive financially in the world, and it is only by the grace of the abuser that the victim has a roof over their head, and food on the table.”
If you’re in a bad situation, we want to do our part in empowering you to move forward.
The Penny Hoarder features a ton of content to help you understand your finances and improve your financial situation. But it can be tough to see how it pertains to you when you feel like you have zero control over your financial life.
Here, I try to put it into context.
I spoke with financial, legal and relationship experts, as well as domestic violence advocates to bring you resources, advice and action steps to prepare you to leave and recover your finances afterward.
6 Steps to Prepare Your Finances Before Leaving
“The largest hurdle you face in an abusive relationship is getting back your independence,” Kuehner says.
“Only when you take back the feeling or idea that you are not completely dependent on another can you move towards financial independence. And only then can you successfully remove yourself from that type of relationship.”
Even then, it’s easier said than done.
In addition to the financial hurdles, Harden repeats a fact many of us have heard often: “Lethality for an individual and her loved ones goes up drastically when she makes the decision to leave, when she leaves and the time period following.”
That’s why before you do anything, we recommend this step:
1. Connect With a Victim Advocate
Harden and other experts urge anyone trying to leave an abusive relationship to work with a victim advocate.
These people are trained and experienced, so they know how to help you plan to leave safely and quietly. They can point out potential pitfalls and let you know what major financial hurdles to expect.
How to get in touch with local advocates:
- Call the National Domestic Violence Hotline: 1-800-799-SAFE (7233) or TTY: 1-800-787-3224. The national hotline can get you in touch with an organization in your area.
- Statewide advocacy groups can also connect you with local advocates.
- Your local YWCA has resources to fight domestic violence, including shelters and services around the country.
We have additional recommendations for your financial health, but can’t tell you what’s best or what’s safe for your situation.
You’re the best at assessing your own safety, so listen to your own instincts, work with an advocate and only consider these steps if you know it’s safe.
2. Save Money
“Be sure you have liquid funds held in an account in your name only,” says Allison Alexander, a financial advisor at Savant Capital Management. She also recommends having credit cards in your name alone.
Allstate’s financial empowerment curriculum includes advice on how to build a solid financial foundation, including places where you could find loans.
If you don’t have access to a loan, see if there are other ways to secure money for yourself that your partner doesn’t have access to.
Here are some creative ways to make extra money:
You can also keep an eye out for influxes of cash your partner doesn’t know about or have access to.
“A lot of survivors … wait until that tax return comes, and that’s a nice little chunk to get started on,” Pentico says.
A bonus at work may be a similar lifeline.
You may be able to work with the human resources department at work to automatically deposit part of your paycheck into a separate bank account.
Catherine Scrivano, a Phoenix–based financial planner, says HR may also be able to help you make an adjustment to your W-4 to help you receive more money with each paycheck that you can save or invest throughout the year.
3. Make Copies of Important Documents
“Make copies of all financial documents you can find, e.g., tax returns, bank statements, investment statements, mortgage/loan information, car titles, paystubs, etc.,” Alexander says.
You can simply snap a picture of these documents with your phone and email it to a friend. Or store them in a cloud drive that you — and only you — can access from anywhere, like Google Drive.
4. Cut Ties and Open a New Bank Account
Before opening your own account, Harden recommends, you’ll need a new mailing address — a P.O. box could work — and an email address your partner doesn’t know about.
Harden also suggests you contact your bank to update your account’s security questions, if your partner already has access to an account in your name.
“Your husband of 10, 15 years probably knows the answers to most of your security questions,” she pointed out, “especially if he’s been actively working to know them.”
She said you can tell your bank the question you want to use. You don’t have to stick with a default question your partner might know the answer to.
If you can, set up separate accounts your partner doesn’t know about, or at least can’t access.
Also, “remove your personal items from a safe deposit box if it is held jointly,” Alexander says. And “establish your own safe deposit box at another bank and place your financial documents and sentimental items, including jewelry, pictures (or) valuables there.”
5. Find a Financial Advisor
“Find a supportive financial advisor, therapist and friends who will encourage you during the bleak times and celebrate your successes,” Scrivano recommends.
If you have the resources to hire a professional financial advisor — who works for you alone, not you and your partner together — great.
If you can’t afford to work with a professional, utilize your local library or Parks and Recreation department for resources. It may have financial literacy classes, support groups and literature to help you.
Even financially-savvy friends and family can offer advice.
Pentico often tells survivors, “There’s somebody in your life, more than likely, that seems to know what’s going on when it comes to money and finances, whether it’s a co-worker or a family member. Reach out to them.”
6. Find an Attorney
When Kuehner was preparing to divorce her abusive husband, she started by meeting with attorneys.
“I scheduled appointments to meet with all of the best attorneys in town. … All in all, I had meetings with over 85% of the local lawyers in a matter of a couple of weeks…
“If I had an introductory meeting with a particular attorney, my ex-husband wouldn’t be able to use them. It could be considered a conflict of interest. … By narrowing his options, and forcing him to use a less-experienced professional, I gained some ground in the divorce.”
California-based family law expert Amey Telkikar confirmed this tactic, though called it “unsavory” for typical situations.
“An in-person meeting going over the circumstances almost certainly will (include confidential information), resulting in a conflict of interest. A lawyer may still represent the other spouse, but only with the informed written consent of both spouses,” Telkikar explained.
He recommended, “It is in the best interest of a spouse to consult at least one reputable attorney as soon as they suspect or learn of a possible filing for divorce.”
If you don’t have money to hire a lawyer or don’t feel safe conducting this kind of business on your own, a victim advocate can help you discover the resources available to you.
6 Steps to Rebuild Your Finances After Leaving
Unfortunately, Lisa Orban didn’t make a plan to leave her abuser. She did what she pointed out many survivors do:
“Most abused women do not ‘plan’ their escape, they run blindly for their lives when the situation reaches deadly levels, and then pick up the pieces afterward,” Orban explains.
“If you have a golden opportunity to escape, that’s generally what people do,” Orban adds.
“They look for a moment — a credit card left unattended, a check that unexpectedly arrives that you somehow got access to, a Christmas bonus from your work that your spouse doesn’t know about,” Orban says. “These are things you look at, and you go, ‘This is it. This is my chance.’”
When you see that opportunity, she said, “You grab it and you go.”
And then what?
Once you’ve left and you’re safe, your greatest financial hurdle may be not knowing what you’re working with.
Start by figuring that out.
1. Get a Copy of Your Credit Report
Nearly everyone I spoke with recommended one simple, important first step to rebuilding your finances: Get a copy of your credit report.
If you haven’t had control of your finances for years, you may have no idea what state they’re in. To create a rebuilding plan, you have to first know what you’re dealing with.
Do you have credit card debt?
Is an unpaid mortgage in your name?
Are you behind on medical bills?
Your credit report will give you this information.
How to get a free copy of your credit report:
- Contact the three major credit reporting bureaus to get a free copy from each. They’re legally required to give you a free credit report once every 12 months. This FTC guide explains how to request your report.
- Get your credit score and “credit report card” from Credit Sesame. This website breaks down exactly what’s on your credit report in layman’s terms, how it affects your score and how you might address it. (Note: We sometimes partner with this company, but Credit Sesame did NOT pay to be mentioned in this post.)
Your credit history can affect a lot of what you do going forward.
Someone will likely pull it when you apply for an apartment, mortgage, vehicle loan or credit cards, before hiring you for a job or opening a new bank account. It’ll affect how much you pay to rent a car or get a new cell phone. It could even affect your car insurance rates.
Once you know what’s in your credit history, you can figure out how to fix it.
2. Find Resolution on Lingering Debts
Harden recommends resolving the debts you find on your credit report as soon as possible.
“Close out the relationship with the credit union and close out all the loans and be done, so the relationship is over, period,” she says.
Closing accounts and making agreements to eliminate debt quickly may not be your greatest financial option, Harden says, but these steps help you cut ties with your abuser, which is still vital.
Your credit report should show you which creditors you’re dealing with. Reach out to them directly and ask what you need to do to eliminate those debts.
Scrivano points out a divorce agreement isn’t enough to get you out of debts you shared with your partner. For example, even if the agreement says credit card debt is your ex’s responsibility, the creditor doesn’t know — or care.
You’ll likely have to take further action to clear your name, she explains. Contact your creditors to determine exactly what needs to be done — and what, in the end, is your responsibility.
“Hold your advocate accountable for that kind of thing,” Scrivano says, referring to your financial or legal advisors. They should know your divorce agreement’s reach and advise you accordingly.
To prevent your ex from building new debt in your name, Telkikar recommends placing a 90-day fraud alert with the major credit bureaus. That way, businesses must verify your identity before issuing credit in your name.
To initiate a fraud alert with one of the bureaus:
You only have to place an initial fraud alert with one bureau. It will contact the others, the FTC explains. You can renew the alert after 90 days as often as you need.
3. Create a New Budget
Next, Harden says, a survivor has to spend time “learning to budget in the new reality, whatever that new reality is.”
With control over your finances, you can set up new savings and investing plans to “become proactive about having full ownership over (your) finances,” not just reactive to your situation.
“There’s financial stability, and then there’s financial vitality,” she explains.
Without the internet to teach her, Orban learned how to manage her budget through trial and error. She always kept a detailed budget.
“I ended up itemizing my life on a day-to-day basis and seeing how much I had coming in and how much, realistically, I had to pay out to function in a normal way,” she says.
Read our tips on how to budget if you’ve never done it before:
- Follow this easy 14-day plan to get control of your money.
- Watch out for these five common budgeting mistakes.
- Use this free spreadsheet template to create a new budget for your family.
- If all else fails, here’s how to make a budget when you hate budgeting.
4. Rebuild Your Credit
Even if you have damaged credit, you’re not doomed.
“Since my credit had been damaged a bit, I wanted to rebuild that as well,” Kuehner explains. “Taking out share secured loans … was the easiest way I knew. Within a year and a half my credit had been repaired.”
With a secured loan, she explains, “the bank freezes a specified amount of money in your account until payments are made. Each payment frees up the same amount of principal.”
A secured credit card is a similar way to build or repair your credit,
It’s similar to a debit card — you put down a cash deposit and can use that amount in credit.
Unlike a debit card, secured cards report your payment, balance and other relevant behavior to credit bureaus. So it’s a way to establish a credit history if yours is shot or nonexistent.
Read more tips for rebuilding your credit:
5. If You Need to, Find a New Job and Housing
If your abuser didn’t allow you to keep a job, the effect can ripple beyond your lack of control in the relationship.
“It could interrupt a work history,” Harden points out, “or prevent a work history from ever developing in such a way that an employer would find the candidate to be compelling as a potential employee.”
If you’ve lost your job, read these tips:
“Your local domestic violence program has relationships with community resources, so while they may not provide (job placement) themselves, they certainly have built partnerships and relationships with those who do, so to reach out to them,” Pentico advises.
Community colleges can also be a great resource for job placement.
If you want to go back to school, you can even find scholarships specifically for survivors of domestic violence.
If your relationship has forced you to take a break from the workforce, but you don’t want to return to college, you might be able to ease back in through a return-to-work internship.
If you’re able to live with friends or family to cut expenses and save for a while, go for it.
If you’re ready to find your own place (or not ready, but need to, anyway), here are some tips for getting the best deal out of your next rental.
On a positive note, Kuehner adds, “Replacing household items can be done fairly reasonably as well. Social media sites have ‘online garage sale’ postings, and you can pick up items really cheap. Hitting the Goodwill and other thrift stores are a great idea too. You can find some great treasures at rock-bottom prices.”
6. Prepare for Financial Success
The final step is refocusing on financial vitality, Harden says.
What does a thriving, successful life look like for you? Is there a business you need to reclaim, a career you need to start over or education you need to finish?
If you’re relying on financial support from loved ones, these 13 steps could help you cut the cord.
Focusing on financial independence will take you from reacting to a bad situation to being proactive about your own success.
And remember, you don’t have to go through it again.
Remember going forward, “Being in a relationship, regardless if married or not, does not mean you have to commingle all funds,” Kuehner says.
“I am a huge proponent of a mine, yours and ours type of finance. It is a simple technique, but can have enormously positive effects,” she explains.
To maintain financial independence and vitality in the future, know you don’t have to relinquish control to your partner. Early on, negotiate a split of resources and financial responsibilities that satisfies and respects both of your needs.
Now, Orban is retired and has been writing about her experiences for three years.
Her first book, “It’ll Feel Better When It Quits Hurting,” is a memoir of her life before leaving her ex-husband.
Her second will cover how she rebuilt her life after leaving.
Since 1990, Orban remarried and divorced her second husband. She has five children altogether, and one grandchild. One son is in college, one is still in high school and the rest are grown.
She eventually went back to college and earned her associate degree in psychology.
Healing emotionally and financially took a lot of time and work. But a small epiphany late one night made her realize she could do it.
“(I realized) I didn’t have to wait for time to heal all wounds. I could make steps and go forward and go, ‘I am in control of my life now — me — and I can make these changes.’”
If you or anyone you know needs help, contact the National Domestic Violence Hotline to speak with an advocate or be connected with someone in your area: 1-800-799-SAFE (7233) / TTY: 1-800-787-3224
Your Turn: What advice can you add for anyone trying to rebuild finances?
Dana Sitar (@danasitar) is a staff writer at The Penny Hoarder. She’s written for Huffington Post, Entrepreneur.com, Writer’s Digest and more, attempting humor wherever it’s allowed (and sometimes where it’s not).