Financial Issues in a Marriage
Managing finances is difficult enough for one person, but doing so as a couple presents many new challenges. Financial concerns can cause stress in a relationship and, in some cases, lead to conflict and divorce.
We recently surveyed over 1,200 Americans, either married or divorced, to examine how couples and ex-couples dealt with finances in their relationships.
Our study found that many couples enter into marriage with little to no understanding of their spouse’s financial situation or background. Their struggles over various money issues have caused fights and deception. Read on to see which financial habits and stressors affect most American couples, and what steps they can take to combat these problems.
Money Talk Before Marriage
It’s important to understand a partner’s financial situation before getting married, but we found that having the money talk isn’t always the norm; nearly one in four Americans didn’t discuss their salaries or savings before tying the knot.
Here’s what else they failed to disclose.
Having discussions about finances is difficult, especially for those with financial insecurities, debt, or poor credit. But talking openly and honestly about money with a partner can also be key to establishing what experts call financial intimacy.
While 78% of Americans believed they were financially compatible with their partner, our research shows that divorced couples were less likely than married couples to share financial information with their partners. Specifically, they were more likely to avoid talking about their salary, savings, debt, spending, and crypto investments.
Overall, only one-third of Americans disclosed cryptocurrency earnings or spending to a partner before the big day, leaving their future spouse in the dark about what they had stored in their cold wallets. Just over 25% of divorced Americans had discussed their crypto investments, compared to 34% of married couples.
Crypto is much easier to hide from financial disclosure documents due to the nature of decentralized currencies, which could be why they’re becoming popular avenues for concealing money during divorce settlements.
Our findings also indicate a more forthright and cautious approach to financial transparency in younger Americans – Gen Z and millennials were more likely to have financial conversations before marriage than older generations like Gen X and baby boomers.
What Do Couples Argue About the Most?
Many Americans reported going into a marriage without a complete understanding of their partner’s financial situation, which led to significant relationship struggles. Arguments over financial issues were a top cause for American divorces, with quarrels ranging from bad spending and budgeting habits to debt history.
We found that a lack of self-control and honesty were the biggest problems affecting American marriages. According to our study, the top conflicts among divorced or separated Americans were overspending, poor budgeting, and secret purchases unknown to the other partner at the time. Hiding purchases may have been a particularly significant factor in marriages ending since they were a much more common conflict among divorced Americans than married ones.
Arguments over finances were also difficult for couples to handle emotionally. Over half of Americans who reported financial struggles with a spouse said these disputes negatively affected their happiness. People with unhealthy financial situations are subject to more stressors that lead to arguments and possibly divorce.
In fact, research shows that financial wealth alleviates intense stress, provides greater control and leads to more satisfaction.
Since overspending was the top financial issue leading to conflict in marriages, we broke down survey respondents’ purchases to find which things caused the most friction. We discovered that it was most commonly caused by a partner treating themselves to the finer things in life: 33% of Americans reported that spending an average of $1,450 on luxury items in one month led to a fight.
In contrast, despite being the highest expenditure at an average of $1,651 per month, stock investments were much less of a source of conflict than luxury goods, clothes, or dining out.
Financially Cheating on Your Spouse
Deception of all types can cause trouble in relationships, and financial dishonesty is no exception. According to our survey results, over three-quarters of Americans admitted that they or their partner have tried to hide purchases, with Gen Z self-reporting that they’re the most likely to do so.
But being financially dishonest came in more forms than covering up purchases — many of our respondents also reported lying about crypto purchases.
Debt can be a major source of stress for individuals and couples alike, but it may place additional pressure on relationships. A recent survey found that over half of Americans who reported financial infidelity were in significant debt and that the main reason people hid purchases was to avoid an argument with their partner.
It’s understandable, considering that almost one-quarter of the couples we surveyed said that dishonesty about debt caused most of their fights.
Road to Recovery
Working through a financial issue is never easy, but couples can move past it. We found that some strategies worked better than others among our survey participants. Surprisingly though, the most common solutions were not the most successful ones.
Setting up an emergency fund could be an untapped key to saving marriages plagued by financial stress. While this was the most successful strategy according to 71% of married Americans, only 20% of all couples and 10% of divorced couples tried it. It turns out that for many American couples, having money set aside in case budgeting fails or a crisis arises can make a big difference.
Budgeting is often the cornerstone of popular financial advice given to couples looking to conquer financial woes, and it was by far the most popular course of action among our respondents. However, it was one of the least effective strategies, second only to couples therapy (the least effective of all).
Though changing the way bank accounts were either linked or separated were less common solutions, they were also among the most successful. As relationships differ from couple to couple, some appear to benefit from the financial independence of managing their own money, while others benefit from the use of a joint account.
Financial infidelities such as hiding expensive purchases only add more stress to relationships that might already be struggling. Other poor spending or saving habits can also lead to conflicts within marriages that sometimes result in divorce.
But American couples experiencing financial troubles aren’t without hope. Solutions like emergency funds or joint bank accounts may help partners get through tough financial times together.
For this campaign, we surveyed 1,294 Americans to learn about financial issues within their relationships; 80% were married, and 20% were divorced or separated. Among them, 52% were men, and 48% were women. Generation breakdowns were as follows:
- Generation Z: 18%
- Millennials: 42%
- Generation X: 28%
- Baby boomers: 12%
For short, open-ended questions, outliers were removed. To help ensure that all respondents took our survey seriously, they were required to identify and correctly answer an attention-check question. Survey data has certain limitations related to self-reporting. The margin of error is plus or minus 3% with a 95% confidence interval.
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