Marriage is wonderful and rewarding. Moving through life with someone you love and trust is a beautiful thing.
So why do 40-50% of marriages in the United States end in divorce?
There’s no single answer to that. It’s usually a number of factors.
One of the biggest issues though is money. In fact, divorce and money issues are inextricably tied together.
If couples are unable to remain vigilant about the following financial issues, it could mean that divorce is looming.
1. Mismatched Attitudes About Money
One of the most effective ways to ensure that you don’t find yourself wondering how to protect yourself in a divorce is to talk about your financial situation before getting married.
The old adage that “opposites attract” is true to some extent. If there’s one person in the marriage who is frugal though while the other spends without any thought, there is going to be tension.
This eventually creates arguments and resentment between both parties – since the spender feels nagged and the saver feels vulnerable.
Each person coming to a marriage comes with his or her own financial debt.
If the debt owed by one person is more than that owed by the other, this can create friction when it comes to spending.
Debts incurred by each individual pre-marriage stay with the individual and won’t affect the spouse’s credit rating. Joint debts incurred after marriage, however, are owed by both partners.
These include costs for child care, housing, and food.
3. Financial Infidelity
Sexual infidelity is a concern for many married couples. Financial infidelity can have equally devastating consequences though.
If it’s revealed that one partner is keeping a secret bank account, has a gambling addiction, is making huge purchases, or has a debt he or she hasn’t shared with the other, it breaks the ties of trust.
Why one partner would have these issues could be an unaddressed emotional issue that could be resolved with therapy. But both partners have to be willing.
4. Having Children
Raising a child to the age of 18 is expensive.
There’s food, clothing, classes, activities, cars, school, saving for college, etc. This is assuming that the children leave at the age of 18. Many don’t. So that means extra expenses beyond that age.
Even if both spouses are prepared for these expenses, they need to also consider what would happen if one of them cuts their hours, changes their career or loses their job during this time.
Without a plan in place, there is likely going to be financial stress and arguments around it.
5. Combining Bank Accounts
Many married couples assume that once they get married, it just makes sense to combine their assets.
This isn’t always the case. Especially if one spouse is inclined to spend far more money than the other.
So sometimes there are significant tax and financial advantages to maintaining separate accounts. Having three bank accounts – one for each spouse and one shared – can greatly minimize conflicts around this.
Divorce and Money Issues Are Connected
It’s clear that divorce and money issues go hand in hand. You could even say they’re, ahem, married.
So if you’re married or planning on getting married, it’s crucial to stay vigilant to these financial challenges to keep the peace.
And if you’re looking for other great tips on living your best life, keep checking back with our blog.