FORT WORTH, Texas--(BUSINESS WIRE)--More than a third of married American couples reported experiencing financial stress very or fairly often, according to newly released research from Elevate’s Center for the New Middle Class (CNMC). The same study found that 21 percent of marriages exhibit behaviors of unhealthy financial partnership. These behaviors might include:
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Failing to reach financial compromises | ||||
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Not comfortable talking with each other about finances | ||||
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Feeling that their partner does not support their financial goals | ||||
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Not understanding each other’s position in arguments |
These behaviors can correlate to other red flags – with respondents less likely to feel their partner meets their needs, less confident in their partner’s honesty about spending, and less satisfied with their relationship overall.
“However, the conventional wisdom that money is a cause of marital discord may be misplaced,” said Jonathan Walker, executive director of Elevate’s CNMC. “There’s a correlation, but each situation is as unique as each couple.”
If the survey results seem bleak, they may reveal steps that couples can take in order to improve both their financial and relationship health:
Be transparent about spending. According to the survey, 24 percent of respondents say they are not confident that their partner is entirely honest about their spending with them. The suspicion of secrets leads to distrust about a partner’s actions. The study also found that the emotional load of keeping an eye on a partner’s actions undermines the couple’s progress. The good news? Thirty-nine percent of couples report discussing household finances regularly.
Define and discuss financial goals. “Trust and transparency in finance were strong themes from the survey,” said Walker. According to the study, 18 percent of couples argue often about money, but couples with defined financial goals argue about money 32 percent less than those without. More good news: Sixty-three percent of American couples have defined financial goals.
One clear goal might be buying a home. While this is easier said than done, the study found that renters are more than twice as likely to experience frequent financial stress than homeowners. “It’s important to flag that this is a correlation,” said Walker. “Buying a home of course won’t fix a couple’s financial problems, but the process of saving for a home together may help align two individuals’ goals and encourage frugality.”
Consider co-mingling finances. Couples who co-mingled their financial accounts were much more likely to report having shared financial goals and seeing eye-to-eye on household finances. “This also demonstrates a degree of trust and helps promote financial transparency and honesty,” said Walker. “But it’s not a fix if there are existing issues.”
Define family goals, as well. According to the U.S. Department of Agriculture, the cost of raising a child to the age of 17 is roughly $250,000 (varies based on location and other factors). The CNMC study found that households with non-prime credit are typically larger than prime households. “Having children is very much an emotional decision, but it is worth noting that more people in the household correlates to more frequent unexpected expenses,” said Walker.
Try to be empathetic. The study found that when disagreements arise, individuals often see things slanted in their own view. Across all categories, individuals reported that they tried to consider their partner’s perspective, but felt their partner didn’t consider theirs. Emotional support is also important. From Walker: “While causality is uncertain, it is possible that couples who emotionally support each other seem to feel less friction over financial decisions.”
About the Research
The Center’s research compared the responses of 1,011 Americans with prime (n=510) and non-prime (n=501) credit scores using interviews conducted January 12-17, 2017. For more details on the study, click here.
About Elevate’s Center for the New Middle Class
Elevate’s Center for the New Middle Class conducts research, engages in dialogue, and builds cooperation to generate understanding of the behaviors, attitudes, and challenges of America’s growing “New Middle Class,” defined as those with credit scores below 700. For more information, visit: http://www.newmiddleclass.org.
About Elevate
Elevate (NYSE: ELVT) has originated $4.9 billion in non-prime credit to more than 1.8 million non-prime consumers to date and has saved its customers more than $2 billion versus the cost of payday loans. Its responsible, tech-enabled online credit solutions provide immediate relief to customers today and help them build a brighter financial future. The company is committed to rewarding borrowers’ good financial behavior with features like interest rates that can go down over time, free financial training and free credit monitoring. Elevate’s suite of ground-breaking credit products includes RISE, Elastic and Sunny. For more information, please visit http://www.elevate.com.
