We should never underestimate the emotional and willful courage of those who survive domestic and intimate partner violence. The decision to leave an abusive relationship and start over is an emotional journey consumed by the fear of the unknown. While physical and emotional abuse tend to be the more talked about forms of abuse, many victims of domestic and intimate partner violence also experience financial abuse. Survivors are often left not only with little financial resources, but also a lack of financial security.
WHAT IS FINANCIAL ABUSE?
Financial abuse can happen in many ways, however, in the context of a relationship, it is when your partner or spouse controls your ability to use, access or acquire financial resources. It also includes the use of your money, property or assets without your permission.
Examples of financial abuse include:
- Your partner demands that you ask permission before spending money, even if you earn your own income, and/or gives you an allowance or unrealistic limitations on what you can spend.
- Your partner prohibits you from opening your own bank account or requires you to deposit your income into their personal account.
- Your partner monitors your expenses, no matter how reasonable or small they might be, and criticizes you for them.
- Your partner forbids you to work or controls where you can work.
- Your partner uses your money or credit cards without permission.
- Your partner demands you pay their bills and financial obligations from your income.
- Your partner forces you to change your will, financial or legal documents or your power of attorney so that they have control of your assets and money.
No matter how financial abuse is carried out, the goal of the abusive partner is to gain power and control over the victim by taking away his or her financial freedom and opportunity for financial independence.
THE IMPACT OF FINANCIAL ABUSE
Everyone’s situation is different, but many survivors of abusive relationships are limited to what funds and monetary resources they have once they leave the relationship. Common impacts of financial abuse that survivors may face include:
- Not having any savings to establish security once a survivor leaves the relationship.
- Low or no credit due to not being allowed a credit card or their partner misusing their credit cards.
- Carrying high levels of debt because they co-signed for their partner’s debt.
- Lacking skills such as budgeting or proper money management because they had no control over their finances.
The biggest financial impact of recovering from an unhealthy or abusive relationship is financial insecurity and not feeling that you are equipped or able to support yourself and your children. This insecurity alone is such a large hurdle for some, that they may feel it is best to return to the relationship for financial security.
ESTABLISHING FINANCIAL FREEDOM
If you are a survivor, know that whatever horrific events you’ve experienced do not define you or your financial future. There are steps you can take to regain control and start your path to financial freedom.
Once personal safety and stability are established after leaving the abusive relationship, there are simple steps you can take towards financial independence.
1. Opening a new bank account
You need to be able to safely store, deposit and access your money. The best way to do this is by opening a new bank account, preferably at a different bank than any past joint accounts you had with the abuser. Don’t worry about having enough funds. Banks do not require you to deposit money upfront when opening an account; you simply need a valid ID (Social insurance card or driver’s license).
2. Make a monthly budget
Once you’ve figured out how much your monthly income will be, you need to plan out how you’re going to allocate your dollars. Remember, budgets need to be practiced, and it may take time before you find the percentage breakdown that works for you.
If you don’t know where to begin, try the 50/30/20 budget:
- 50% of your income goes to necessary household expenses;
- 30% to “wants” (entertainment, hobbies, etc.);
- 20% to savings and reaching financial goals (getting out of debt)
If you are overwhelmed by creating a budget, don’t be afraid to seek help from a credit counsellor, your bank or look into the numerous budgeting apps available for a smartphone.
3. Make sure your taxes are filed
It’s important to ensure that your income taxes are filed and up-to-date to avoid any tax debt from the CRA. You will also want to ensure that you’ve received all tax refunds you’re entitled to AND non-refundable tax credits you’re eligible for. Missed tax credits could improve your refund, and provide you with a sum of money that can help establish savings.
4. Obtain a copy of your credit report
If you aren’t aware of the current state of your credit history, you need to get a copy of your credit report. Review the report to make sure that the report is accurate and has no signs of identity theft, that it properly lists your debts and creditors, and to see where you stand in the eyes of lenders. Establishing good credit is important for applying for apartments, purchasing a car, getting a cell phone or applying for a mortgage.
I’m honoured to be a guest speaker at the “Zero to Hero” event in Edmonton, Alberta on September 22d, 2019. The event is organized by an inspiring and empowering organization, Gems for Gems which provides and supports proactive solutions to help end the cycle of domestic abuse through unique, positive and forward-focused approaches. The organization was founded by Jordan Guildford.
The “Zero to Hero” event is a free event with the premise to show survivors of abuse how they can be their own “Hero” through learning certain skills from ground “Zero”.
The event covers topics such as:
- Coping mechanisms from a psychologist
- Resilience and attaining goals
- Financial literacy
- Entertainment – the event will conclude on a fun and high note with a performance by a local artist.