43% of Marriages End in Divorce According to New Statistics (2021)
Which is actually better than the divorce rate 20 years ago, according to Ibis World [1], where the divorce rate was closer to 50% based on divorce rate to marriages.
However, that percentage still seems extremely high to me, that means 2 in 5, almost 1 in 2 marriages, end in tears and messy finances.
And do you want to know what the number one reason for divorce in Australia is?
You probably already know, but it comes down to money most of the time, from partners lying about their finances to not being able to create the lifestyle that was promised and changing values surrounding money.
Therefore, one way to help bring that divorce rate down significantly would be to do what you reckon?
If you thought, well its simple, you just need to acquire more money…
You would be right to some degree, however, when it comes to money, having more doesn’t mean that you are happy.
In fact, a recent study completed by the Purdue university [2], using the Gallup World poll data, suggests that earning more money up to a certain degree can indeed bring more happiness, if the money is spent the right way. Mainly by buying back more time to spend with family and loved ones, as well as giving back to the community you live in.
Therefore, having more money is definitely going to help decrease the statistic, however it is also how you use your money, how you communicate with your partner about it and also will come down to how much time you spend earning said income.
So first of all, how much money is needed to be happy/content in your relationship and also yourself?
Well according to two different studies, from Princeton (2010) and Purdue Universities (2018), the bottom line is US$75,000 or AUD$100,634 per year.
That is the amount needed to be earned each year to at least be happy, to live the life you want, afford everything you need and to be able to service all of your debts as well, plus have some surplus cash to do with what you like.
If you are not earning that much personally, but you are married or in a De Facto relationship, don’t stress, because that corelates to household income as well. Therefore, between you and your partner, if you earn at least this much between you, based on the studies above, you should be content with your life.
Of course, that brings me to the next issue when it comes to money in relationships, which also is probably the number one reason why money is the killer of most marriages.
And that comes down to how you spend said money and communicate that spend with your partner!
1 in 4 (23%) have lied to a significant partner about their money spending habits [3], with the main reason of lying to said partner being debt (50% of respondents blamed debt for lying).
There are a few things that my wife and I do that I would like to share with you, which has definitely helped improve our relationship.
We have a night every one to two months where we go through our finances/budget and talk about where we are heading honestly and openly.
We have no hidden accounts, the only account I have which my wife doesn’t have access to is a business account. However, if she wanted to see it, all she has to do is ask.
We have a few standards, if we are wanting to make a purchase above $200, we need to talk with our partner about it first. Especially, if the purchase is a want, rather than a necessity.
Has that stopped us from having disagreements every now and again? No, of course not. We still have areas where we don’t agree, because we are fundamentally two different people.
An example of this would be our use of surplus cash, I love experiencing things and seeking adventure, we both do in fact. However, I am more risk-oriented, therefore I am fine with having less cash on hand, my wife is not though.
My wife is the opposite and has been taught to save and have cash in reserve, which is a great lesson to be taught. That is why we discuss the use of our money and where it goes, we disagree on some elements, but that is where compromise is needed.
Once we have agreed on the compromise of how to use said surplus cash, we need to stick by it. Which is what the monthly, to two monthly “date nights,” as termed by the ‘Barefoot Investor’ Mr. Scott Pape, are for.
To keep each other accountable and to make sure that we are moving in the same direction and spending the money in the right way.
The subject of relationships and being able to build better connections through open and transparent communication is a big one, and all it takes is for one person in the relationship to prioritise it and bring up any frustrations/concerns.
I truly hope that the above has been able to help someone in their own relationship, to help make your connection last!
Until next time,
Take Back Control
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