Kerry K. Taylor is a blogger and freelance finance writer. In 2011, she and her husband, Carl, were married in a rural Canadian town. Their wedding cost about $400 USD. Shoestring weddings are counter-culture compared to the ballooning nuptial price tags of the day. But couples with lower-cost weddings might have better odds of staying together.
According to The Knot's 2016 Real Weddings study the average wedding cost was $35,329 in 2016. Business Insider says the average American worker between the ages of 25 and 34 earns just $39,416 per year. That means the typical working stiff might pay more for a wedding than he or she earns in a year (after paying income taxes).
Quentin Fottrell, writing for MarketWatch, references a survey of 1000 recently married women. The survey, conducted by PayPal and the wedding-service site, TheKnot.com, says 36 percent of couples pay for their weddings with their credit cards. That might make bills tough to pay and add stress to a relationship.
Money doesn’t buy happiness. But a 2016 Purdue University study says debt often leads to misery. By staying out of debt (or keeping debt levels manageable) couples increase their odds of staying together.
Researchers Jeffrey Drew, Sonya Britt and Sandra Huston say arguing about money is the top predictor of divorce. They published their findings in a 2012 Family Relations journal. The study included data from more than 4,500 couples as part of the National Survey of Families and Households.
Sonya Britt says couples that argued about money early in a relationship are at the greatest risk of divorce. But financial experts offer tips that might help these relationships.
Robert Hernandez is a Certified Financial Planner (CFP) with Main Street Associates in Queens, New York. He says, “Couples should set up ground rules for money communication. The goal of this communication is to eliminate guilt because it tends to cause one spouse to hide things from another which results in a breakdown.”
CNBC’s Jennifer Barett reports that 7.2 million Americans are hiding money or credit cards from their spouses. To improve the odds that a marriage will succeed, Hernandez says couples should put everything on the table. After doing so, they can work on a plan to eliminate debt and build assets, without the nagging sort of guilt that can break down the marriage.
Toni Coleman agrees. She’s a psychotherapist, relationship coach and divorce mediator in McLean, Virginia. “It is important to have candid conversations about finances,” she says. “Any debt, credit history, and/or any history of bankruptcy, unpaid taxes, or liens against property or income should be disclosed because marriage will make them the shared problem of the couple.”
Couples should also plan to tackle debt and build wealth together. Unfortunately, one partner often takes control of the couple’s finances, leaving the other in the dark.
Such is the case with one of my friends. He invested most of his family’s retirement money ($100,000) in a single stock. It’s now worth about $5000. His wife doesn’t know how he invests their money.
That’s why Brandon LaValley says couples should work together. He’s the Director of Financial Planning at Targeted Wealth Solutions in Colorado Springs. He says, “We see a significant decrease in financial arguments when both people have an understanding of the budget and how their money is being earned, spent and invested.”
Sometimes couples want different things. One partner might be a saver. The other might be a spender. Such couples need to reach common ground, while giving each other some breathing room. Michael Kelley, a Certified Financial Planner with AXA Advisors says couples should use individual “slush funds” to avoid disputes. “After the couple has contributed 15-20 percent of their income into a retirement plan,” he says, “they should agree on an amount that each person can put into their own ‘slush fund’ to be used for whatever that person wishes.” This gives each person some wiggle room, while the couple strives towards their shared financial goals.
Financial discussions are important for couples that have already tied the knot. But they’re even more important for those getting set to say, “I do.” After all, if you can’t talk about money before you’re married, you might have an uphill battle ahead.
Andrew Hallam is a Digital Nomad. He’s the author of the bestseller, Millionaire Teacher and The Global Expatriate's Guide to Investing: From Millionaire Teacher to Millionaire Expat.