Think Different

Think Different

Why does getting married affect your finances?

Photo: Dave Meier. Source: Picography

A great deal of research documents that married people are financially better off than singles. Apart from having a lower tax rate for “married, filing jointly,” married people enjoy other advantages: pooled living expenses, shared shelter, greater employment benefits, lower insurance rates, and so on. But one significant advantage is psychological.

In most relationships one partner tends to think long-term and the other short-term. Long-term thinking entails planning for retirement or saving for education; short-term thinking involves investment opportunities or new job prospects. Both types of thinking are necessary: long-term thinking requires you to plan for the future, while short-term thinking encourages you to make the most of the moment.

Relationships are often about compromise, in big and little things. When you live with someone who doesn’t think the way you do, you have to adapt. When married, a short-term thinking partner is less likely to act impulsively and chase fantasies. At the same time, the long-term planning spouse isn’t as liable to get stuck in a rut of low expectations and small futures.

This may be one reason why the best predictor of poverty is whether the person is a single parent. Having the obligations of parenthood without the resources of a couple—financial, emotional, and psychological—is a daunting prospect. And having another way to think about money is especially important.

Douglas R. Tengdin, CFA

Chief Investment Officer

By | 2017-07-17T12:22:12+00:00 January 8th, 2016|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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