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Debt and Marriage: A Deadly Combination

One of the greatest things in life is marriage.  When you find someone to share your life with you become a more complete person.  However, marriage is also one of the greatest challenges in life, and when you throw money issues into the mix it’s no surprise that one of the top reasons for divorce is money fights.

Those fights are not regarding having too much money:-), but are centered on challenges primarily related to debt and having too little money to cover monthly bills.  Arguments about money is by far the top predictor of divorce, according to Sonya Britt-Lutter, assistant professor family studies and human services and program director of personal financial planning at Kansas State University.  She was one of the researchers who conducted a study using longitudinal data from more than 4,500 couples as part of the National Survey of Families and Households.  In their study the researchers controlled for income, debt, and net worth and the results uncovered it didn’t matter how much money you made or what you were worth.  Arguments about money were the top predictor of divorce because it happens at all levels.

These fights are the result of stress put on a relationship because of money challenges.  The American Psychological Association found that money was the second highest source of stress among American adults.  Thirty-four percent of those surveyed said they are worried about unanticipated expenses; 30% worry about having enough saved for retirement; and 25% worry about paying for basic living expenses.

In another study 70% of couples admitted to arguing about money issues, and 57% of divorced couples said that arguing over money problems was the reason for their divorce.  Armed with this knowledge, our goal is to help you not to become one of these statistics if you’re struggling with money issues in your marriage.  

Even if you’re not currently having money fights with your spouse what we share in this post is great wisdom for making sure you are taking preventive measures to ensure your marriage continues to be a blessing.


Marriage and millionaires.

Thomas Stanley and Sarah Stanley Fallaw, authors of the book entitled The Next Millionaire Next Door, report in their research that 80% of millionaires believe their spouses are a critical factor in their economic success.  From a practical perspective this makes perfect sense.  When you and your spouse work as a team you’re going to make far greater progress than if only one of you is striving to be financially successful. 

One of the greatest tests for determining the level of teamwork in your marriage is to hop on a tandem bicycle with your spouse and go for a ride.  An even better test is to do this over some hilly terrain!  You will quickly see if only one of you is doing most of the pedaling climbing those hills will be a challenge, but going down the hills will require practically no effort. 

Marriage is similar in that when times are good (i.e. money is not an issue, debt is low or non-existent) little effort is required because you’re gliding along with little energy needed.  However, when times get hard and you’re climbing uphill (i.e. overburdened with debt, living paycheck-to-paycheck) and only one of you is “working” to deal with the situation, a fight is all but guaranteed to take place.


Transparency: going from “me” to “we”.

One of the secrets to success is being in sync with one another and communicating through both the ups-and-downs.  Regardless if times are good or not-so-good, you should always be communicating about your finances.  A good first step in communication is being transparent about your current financial situation.

Being transparent means laying all your financial accounts on the table and sharing them with one another.  This is a great thing to do BEFORE getting married so that both people know what they are getting into before saying “I do”.  After marriage having not shared, or worse hidden, these things from your spouse is another form of infidelity – financial infidelity. 

A Harris poll reported 42% of those they surveyed said they had committed financial infidelity by hiding things from their spouse.  Seventy-five percent reported that this had a significant negative effect on their marriage.  These statistics are not all that surprising.  How would you feel if your spouse was hiding thousands of dollars in debt and / or investments from you?

There’s no easy way to become transparent except being honest with your spouse and admitting your mistake.  On the other side of the table you need to forgive (i.e. remember that vow, “for better or for worse”?) and move forward by getting everything out in the open.  We suggest making a list of all accounts and their balances to get a current state of your financial picture.    By doing so you will take a big step forward in moving from “me” to “we”.


Trust: a foundation to build upon.

Once you become transparent with one another you can take the next step in building trust with each other.  One of us (Scott) used to host a cycling camp in warm and sunny Arizona each winter for friends living in Ohio where the cold winters kept many riders on their stationary bikes inside.  Early in the camp one year the group headed to an ATM to let everyone withdraw some cash to pay for a house the group had rented.  One of the couples did something the others did not do – they each withdrew funds using their own debit cards. 

Scott asked why they did that, and they responded they had both been divorced previously and money was a problem, so with this their second marriage they decided to keep their money in separate accounts.  It’s no surprise that a few years later the couple divorced.  There was no trust in this marriage, so it was destined to fail.

One simple first step in building financial trust in a marriage is making as many of your accounts as possible joint accounts.  This may not be possible with retirement accounts, but for those you can make sure the primary beneficiary is your spouse (if you have no beneficiary for your account in most states it defaults to your spouse). 

Another way to build trust is to use the list of accounts you created in building transparency and documenting the login and passwords for each of them.  There are many great programs you can use to simplify this process like LastPass for passwords and Personal Capital to see in real-time all your online accounts in one place.  Taking these steps will go a long way in changing “your money” into “our money”.


Teamwork: there is no “I” in team.

If we were to guess without even knowing you or your spouse, we’d suspect you are not exactly like one another.  If you’re like us, one of you may love football while the other has little interest in it.  One of you may like numbers, spreadsheets, graphs, and charts while the other is frightened of them.  There’s no problem with this, in fact, some would argue this is what makes for a great marriage team.  One person’s strength can be another person’s weakness, and this is one element of how to become a great team.

The key to performing well as a team is to know your strengths and weaknesses.  When it comes to finances, we like what Art Rainer writes in his book, The Marriage Challenge, about what he describes as four “money personalities”.  Rainer describes the personalities as 1) the spender, 2) the saver, 3) the investor, and 4) the ignorer.

Each of the types have strengths and weaknesses.  The spender tends to think ahead and plan out expenditures for birthdays, weddings, etc. to show people they care about them.  They also take action when a purchase needs to be made.  The negative is they can spend too much and get into trouble buying things they cannot pay cash for.

The saver tends to play it safe with money saving more than they spend and always being prepared for an emergency.  On the downside they can take saving to an extreme and forget to enjoy the money they’ve been blessed with.

An investor has the strength of being willing to take risks in the short term to receive a benefit in the long term (i.e. investing in the market for retirement).  The negative aspect to the investor is they can sometimes take unnecessary risks to seek a higher return with risky investments.

The final money personality type is the ignorer – the one who likes to take an ostrich approach about money by sticking their head in the sand and ignoring their finances.  The upside is they are more willing to trust others with their financial decisions (i.e. wives trusting husbands to deal with the money), but the negative is they tend to be in the dark related to understanding what is happening with their money.  This is a common issue when a spouse dies who was handling all of the money in the family and the surviving person is clueless about the accounts, insurance, etc. they may now need to manage.   

Which one are you? 

A simple test to determine your money personality type is by answering the question, “What would you do if you won a $100,000 prize at your local grocery store?”.  Would you spend it on something extravagant like a new car – you might be a spender.  Maybe use it to pay down your debt – you may be a saver.  Perhaps you would invest it into a mutual fund making you more of an investor, or would you likely ignore the money and let your spouse decide what to do with it? 

There is no perfect answer to this question.  Some are probably better answers than others.  For example, you would never want to buy a new car with the money if you’re sitting on debt that could be paid off.  The key to this simple exercise is better understanding how you deal with money and understanding how your spouse does the same so that you can begin to work better together.

If you are more of an investor maybe you should take the lead in managing your investments.  If you tend to be a saver maybe your role should be taking ownership to lead the monthly discussion regarding your spending plan.  Whatever your personality type, the key is to discover which one you are and capitalize on your strength instead of focusing on your weakness.

A successful marriage takes work from both participants, but if you are transparent with your finances and begin seeing the relationship from a we perspective instead of a me perspective you will begin to build trust that leads to the mindset of our money instead of my money.  A simple tactic for making this become reality is to make sure you are always using the words “we”, “us”, and “ours”. 

If you’re newly married know that this can be a challenge, but words matter.  There is no more powerful muscle in the body than the tongue.  It has the power to bring you closer together and tear you apart, so use it wisely.  Doing so will lead to greater teamwork and ultimately winning with your finances by becoming debt-free so you can start building wealth.

So what’s worked for you?  What challenges have you and your spouse faced regarding money?  Post to our social media pages on Facebook and Instagram to share your thoughts.  Also, if you haven’t already done so sign up for our weekly blog post to arrive in your inbox here and / or send the link to someone who you think could use some guidance in becoming debt-free.



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