When It Comes to Marriage and Money, Opposites Attract
Spouses reshape each others’ financial behaviour, for richer and poorer, marriage research suggests
Spouses reshape each others’ financial behaviour, for richer and poorer, marriage research suggests
The person you marry will often change your relationship to money.
We tend to choose our partners based on shared values, in-common traits and other similarities, marriage researchers say. But money-management styles are one case in which opposites do attract, said Jenny Olson, an assistant professor of marketing at Indiana University who studies couples’ financial decision-making.
We are drawn to people who can check and balance our own rigid rules about money, Prof. Olson said. Someone who feels they are too focused on saving and not focused enough on using money to enjoy life might look for a partner who can help them feel more comfortable with an occasional splurge.
Over the decades, however, spouses often grow more alike. The spendthrifts married to the tightwads manage to find some middle ground, learning from one another in the process, said Scott Rick, a marketing professor at the University of Michigan whose studies marital finances.
“The spouses who don’t converge have a harder time and those marriages are probably more fragile and could end in divorce,” Prof. Rick said, referencing his analysis of 1,303 couples, which will be published in a forthcoming book.
This mutual influence along with the built-in financial accountability couples get when they pool their assets are partly why married couples have a financial advantage over their single counterparts, researchers say. The median net worth of married couples 25 to 34 years old was nearly nine times as much as the median net worth of single households in 2019, up from four times as much in 2010, according to research from the Federal Reserve Bank of St. Louis.
When Kristen James, a 33-year-old product manager in Austin, Texas, first started dating her now-husband, Ben, a 35-year-old startup co-founder, she noticed they came to the relationship with different approaches to their finances. Mr. James considered himself much more of a financial risk-taker; Ms. James preferred to manage her money more conservatively.
Instead of their differences erupting in conflict, Ms. James said her husband’s approach had a positive influence. After talking it over as a couple, Ms. James made the leap to change her career, moving into the technology industry and ultimately earning a higher salary as a result. Without her husband’s encouragement, she said she wouldn’t have felt secure making such a huge life change.
“He said, ‘You’re worth far more than what you’re making,’ and he pushed me to take on more risk and challenge myself in different ways,” she said.
Couples who communicate about the differences in their financial beliefs are better able to make decisions together, as tedious as that practice may initially feel, said Matt Lundquist, a psychotherapist and the clinical director of Tribeca Therapy, a psychotherapy practice based in New York.
He points to clients who take a regular weekend trip and have made it a habit to use the driving time to discuss their finances. While the children snooze in the back of the car, the parents review the state of their budgets and check in on progress toward longer-term goals.
Talking as a pair also prevents an imbalance of power in which one partner appoints themselves money manager, said Adrian Ward, a marketing professor at the University of Texas at Austin.
In his own research looking at how couples manage their money, Prof. Ward found that one partner often takes charge of the finances, not because they’re better equipped to do so, but because they have more time for the job. The in-house money manager—whom Prof. Ward calls “the household CFO”—often shuts the other partner out of the decision-making. Sometimes, the other person is relieved, but over time, that partner’s financial literacy suffers.
“Even though it’s hard to make decisions together and we’re both busy, and it would be way easier for one of us to just do it, it’s the best long-term way to care for each other,” he said.
Marcella Mollon-Williams, a behavioural financial adviser based in Bowie, Md., runs a premarital financial counselling session for couples.
The main issue she sees early on in relationships: Couples too often talk about the things one partner wants the other to avoid doing with their money, as opposed to the things they want to do together.
“Talk about the desires money brings, the things you want to accomplish,” she said. “When you start dreaming together, identifying the things money can buy, it’ll become easier. It’s sort of looking ahead and then working backwards.”
To stay on the same page financially, Kristen and Ben James set a monthly family finance meeting. Talking about their goals, reviewing financial allocations and having time to connect on those topics helps them keep their sights trained on the bigger picture, Ms. James said.
When she’s tempted to scroll through Redfin real-estate listings, she relies on her husband to hold her accountable.
“We have each other to say ‘We’re not buying a new house right now’ or ‘We’re not buying a new car right now’—you have that other person to ground you,” she said.
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The bank posted unaudited cash earnings for the quarter of A$1.7 billion, down 2% on the average of its prior two quarters
National Australia Bank said that higher credit impairments against business loans contributed to a small fall in its unaudited December quarter cash earnings.
NAB , which is Australia’s second-largest bank by market capitalization, on Wednesday posted unaudited cash earnings for its fiscal first quarter of 1.74 billion Australian dollars, equivalent to about US$1.11 billion.
That was down 2% on the average of its prior two fiscal quarters. NAB did not give a year-earlier comparison.
The lender said that revenue grew by 3% compared with the average of its prior two fiscal quarters. Underlying profit growth of 4% over the same period was offset by higher credit impairment charges and income tax expenses, it added.
NAB, which posted an unaudited quarterly statutory profit of A$1.70 billion, said the A$267 million credit impairment charge included A$152 million of individually assessed charges. Those were mainly against Australian businesses and unsecured retail portfolios, it said.
The individual charges were up by 54% compared with a year earlier. NAB said that it had not altered its economic assumptions and scenario weightings.
“The economic outlook is improving but cost of living and interest rate challenges persisted,” Chief Executive Andrew Irvine said. “While most customers are proving resilient, we have maintained prudent balance sheet settings.”
NAB said it had seen a small decline in net interest margin due to funding costs, lending competition and deposits, partially offset by the benefit of higher interest rates.
On Tuesday, the Reserve Bank of Australia cut the country’s cash rate for the first time since 2020 but warned against expecting subsequent near-term cuts.
NAB is still targeting full fiscal-year productivity savings of more than A$400 million, and for operating expenses to grow by less than 4.5%, Irvine said.
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