Rich Habits Podcast Episode 156: Financial Red Flags in Relationships

Hosts: Austin Hankwitz and Robert Croak
Date: February 9, 2026

Main Theme

This episode delves into “financial red flags in relationships”—the subtle money behaviors and attitudes between partners that are often overlooked, but have the power to predict major relational issues or even divorce. Austin and Robert highlight these patterns, share both research and personal anecdotes, and offer guidance for creating healthier financial habits in romantic relationships. They round out the show by answering listener questions on investing, the 4% rule for retirement, and portfolio diversification.

Key Discussion Points & Insights

[01:24] Three Money Red Flags in Relationships

1. Lack of Financial Transparency

• Core Idea: Not knowing each other’s income, debts, or money goals until it’s “too late.”
• Robert: “I've watched couples who've been together for two, three, four years, and one person has no idea what the other person even makes and no idea what their debts are.” (02:41)
• Austin: “Couples who don't discuss finances before marriage are 30% more likely to argue about money regularly throughout their marriage.” (03:17)
• Insight: You don’t need to disclose everything early, but serious relationships should have open, honest money conversations before making big life decisions (buying a house, having kids, etc.).

2. Normalizing Overspending / Lifestyle Creep

• Core Idea: Accepting overspending as status quo, comparing lifestyles to peers or social media, and seeing debt as unavoidable.
• Robert: “Overspending gets treated as normal or even inevitable, especially when it’s backed by comparison... that's how lifestyle creep really sneaks up on people.” (04:16)
• Austin: “If your reference point for happiness keeps moving, you will never arrive. If your lifestyle is growing faster than your financial literacy, debt fills the gap.” (05:45)
• Insight: Envying others’ lifestyles, or constantly feeling pressured to “keep up,” can poison both financial stability and the relationship itself.

3. Valuing Relationships by Cost/Spending

• Core Idea: Judging care, love, or the quality of time together by how much money is spent.
• Robert: “If that's how someone thinks, then anything that doesn't cost money is going to feel like it doesn't matter to them... and that is a recipe for disaster.” (07:16)
• Austin: “Couples who equate spending with love have higher rates of what's called financial infidelity—hiding purchases, secret accounts, undisclosed debt.” (08:27)
• Insight: If you can’t enjoy each other without spending money, underlying issues may surface—leading to resentment and even secrecy (“financial infidelity”).

[09:32] The Domino Effect of Avoiding Money Conversations

• Robert: “If you're hiding small things, it means you don't trust your spouse will understand... Lack of trust compounds.” (09:32)
• Austin: “Every time you avoid a money conversation in a relationship, you're not just avoiding the discomfort at the moment, you're teaching yourself that money is too uncomfortable to talk about.” (10:23)
• Insight: Small secrets and avoidance snowball into bigger problems—keep communication open, even when it feels uncomfortable.

[10:56] Real-World Example: Hidden Debt

• Robert: Recounts a client’s story of discovering her fiancé had over $100,000 in credit card debt after getting engaged: “Make sure you have the conversation earlier than later so you're both on the same page.” (10:56)
• Data Point: Couples who don’t discuss major financial decisions together are three times more likely to report being unhappy down the road.

[12:23] Decision-Making in Relationships: Reactive vs. Intentional

• Austin: “One [approach] is intentional and the other is reactive. Those two things might look identical from the outside, but they feel completely different in the moment.” (12:23)
• Takeaway: Align on values and spending decisions, not just “what everyone else is doing.” The process—how you make decisions together—matters more than the dollar amount.

[13:50] Summary & Reflection Prompts

• Austin: Summarizes the three biggest money red flags:
  • Lack of financial transparency
  • Normalizing overspending
  • Valuing relationship by cost
• Closing Guidance: “Write down... the three red flags... and start thinking about your own life... Do I know about my spouse's credit cards? Are they doing some financial infidelity? Does my spouse think that if we don't go on these vacations that I don't love them?” (15:06)

[14:26] Most Dangerous Red Flag

• Robert: “The value by cost for me is the biggest red flag... You have to be able to enjoy each other's time whether you're spending a bunch of money or not. And if one person... is always forcing that, you should run if you're in that situation.” (14:26)

Notable Quotes & Memorable Moments

• “If you can't talk about money when the stakes are low, you definitely won't be able to talk about money when stakes are high.” — Robert (02:56)
• “If your lifestyle is growing faster than your financial literacy, debt fills the gap.” — Austin (05:45)
• “Couples who equate spending with love have higher rates of what's called financial infidelity.” — Austin (08:27)
• “If you’re hiding small things, it means you don't trust your spouse will understand... and lack of trust compounds.” — Robert (09:32)
• “Personal finance is personal, even when it comes to relationships... but the conversation has to be had.” — Robert (10:23)
• “One [approach] is intentional and the other is reactive... but they feel completely different in the moment.” — Austin (12:23)

[16:50] Q&A Highlights

1. Employee Stock Purchase Plan (ESPP) as a House Savings Vehicle

Listener: Ryan

• Summary: Ryan asks if leveraging a 15% ESPP discount for quick gain is a good strategy to save for a house.
• Insight:
  • Robert: Recognizes the tax impact (short-term capital gains); cautions against using ESPP for short-term savings unless you believe in holding the stock.
  • Austin: “I don't think after taxes, $2,100 is going to be the needle mover for you on an annualized basis to go save up and buy a house... The answer is no.” (19:38)

2. The 4% Withdrawal Rule for Early Retirement

Listener: John R.

• Summary: Asks if the traditional 4% rule still holds for those likely to live more than 30 years in retirement, or if it should be lowered to 3%.
• Insight:
  • Robert: Emphasizes importance of calculating future monthly needs, factoring in inflation.
  • Austin: “If you’re pulling less of the portfolio every year, then yeah, it could be longer... It really comes down to how do you want to live your life.” (24:53)
  • Consider modern strategies: More ETF options and direct indexing offer flexible, tax-efficient income generation.

3. Portfolio Diversification and Direct Indexing

Listener: Andrew B.

• Summary: Andrew has built decent wealth and diversified assets but worries about stock market leverage.
• Insight:
  • Austin: Advises a “core satellite strategy”: 65–85% index funds/ETFs, rest diversified across crypto, metals, real estate, etc.
  • Robert: “You've solved the hardest part of this. You've figured out how to make really good money early on and you have your mindset in the right place to build wealth.” (36:15)
  • Direct Indexing: Celebrated for its tax efficiency and customization.

[14:55] Action Steps & Final Takeaways

• Write down the three red flags and reflect on your relationship.
• Start having important conversations about money—don’t wait for big issues to force them.
• It’s not about how much you spend, but how intentionally and openly financial decisions are made as a couple.
• For Q&A, always weigh tax implications, long-term plans, and diversification.
• Direct indexing and new investing strategies can boost efficiency and diversification for savers.

Timestamps for Key Segments

• 01:24 — Introduction to money red flags in relationships
• 02:24 — Red flag #1: Lack of Financial Transparency
• 04:15 — Red flag #2: Normalizing Overspending/Lifestyle Creep
• 06:50 — Red flag #3: Valuing Relationships by Cost/Spending
• 08:17 — Financial infidelity and its signs
• 10:56 — Real-world case: Hidden debt discovered after engagement
• 12:23 — Intentional vs. reactive financial decisions
• 13:50 — Red flags summarized
• 16:50 — Q&A: ESPP and house savings
• 23:51 — Q&A: The 4% rule and early retirement
• 33:14 — Q&A: Portfolio diversification and core satellite strategy

Tone & Style

Approachable and candid, blending seasoned wisdom (Robert’s perspective) with a learner’s curiosity (Austin’s role). The advice is practical, non-judgmental, and focused on actionable strategies rather than rigid rules.

Closing Thoughts

This episode stresses that conquering relationship money problems starts with honest communication, aligning values, and resisting outside pressures, not just earning or budgeting better. By bringing financial red flags into the open, listeners are encouraged to proactively create stronger, happier partnerships—and lay the groundwork for lasting wealth together.