Wife (36f) has been using her parents money for years to pad our budget

I recently quit my job as I prepare to go full time with my own business and was looking at my finances to modify our budget for the time being.

My wife and I have been married for 12 years and we have 3 kids, she’s been at home with them for about 9 years now. She’s had a house hold and personal spending budget that’s been basically the same for this amount of time and we’ve never had a problem sticking to it. When I look at our finances every few months and yearly, she is below at our budget almost always and manages to get everything we need.

As I was looking at our itemized budget and her recent spending habits (the last 6 months or so, just so I could see a trend), I started noticing that entire purchases or shopping trips were missing from her credit card statements. For example a couple months ago she and her sister took the kids to Disney, I realized that none of that cost was on our accounts and there was no big transfer of money over if it was the case that her sister paid for everything and we paid her back afterwards.

We shop at Trader Joe’s all the time, but the only grocery store we go to according to our credit card statements is Walmart and Costco.

She upgrades some household decor and kids clothing as well as her own and my clothes every so often, but as far as decor and clothing I barely see $150 dollars spent over the past year.

I confront her thinking she has a second credit card I don’t know about.

She confesses that, actually, she DOES have a second credit card but it’s one she’s had for 20 years and her parents pay the balance every month. They’ve had her and all her siblings on a “fun money” allowance. I asked by BIL (married to wife’s sister) and he apparently has known about this and is ok with spending their money as long as it’s on trivial stuff.

I am blown away. Don’t even know how to feel. I’m humiliated, emasculated, angry. I also feel like a fool because I thought this life we were living where I provided a nice lifestyle where we could treat ourselves and get the kids nice stuff has been a lie. My income pays the bills, sure, but I guess I’m an idiot for also thinking it covered all this other stuff my wife does with the kids .

One plus side is we have managed to save money over the years more than what I had ever thought we could, and that’s because my wife uses her allowance on “frivolous “ stuff and never our money, unless it was something we decided to do for the kids together.

I don’t even know what to do here.