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Dani Partum
Marriage Finances: Don’t disempower yourself for convenience
Dani Partum
© Tom Sale
Division of labor in marriage and relationships is practical and good. But there is often a problem, for example with the important financial planning and retirement provision. Many wives leave this to their husbands and thereby incapacitate themselves
Two quick questions: What is your marital net worth? How and where is it invested and what returns does it bring? Do you understand right away? And: Which parts of the assets are used for retirement provision and who has access to them?
Many married women raise their eyebrows and shoulders at such questions. “My husband takes care of it,” she says evasively. “I don’t know enough.” And the argument was settled. Presumably. Until the day someone ends the marriage, there is almost no money when retirement starts despite high income, or the husband suddenly dies. Like a friend of a friend.
The fatal accident has entrusted the 70-year-old with the task of regulating the marital finances overnight. What money was in which accounts and what her husband had invested in – she did not know. The couple belonged to the highest incomes, both academics. Long-term financial decisions ended up in her area of responsibility, she kept an eye on day-to-day finances. When she realized how dependent and ignorant she had been during the decades of their marriage and she described it to my friend, this realization culminated in her indignant exclamation, “She incapacitated me!”
“He incapacitated me!” Really?
Did he? Or did he tacitly accept his willingness to handle the finances of the wedding because he suited her? In today’s world, two are required to become incapacitated. The marriage law no longer prescribes anything like this, as it did until the 1960s, when the husband had the exclusive right to administer the common property and that of his wife. The wife was incapacitated by law. Legally, this is in the past. It is still a reality in Germany.
In a representative survey conducted by UBS Investor Watch in 2019, 60 percent of women surveyed in Germany said they transferred responsibility for financial planning and pensions to their husbands while married. As a result, women are disenfranchised if they leave their husbands alone to take care of their old age and marital finances.
Younger women, especially, forego financial planning
And this is not a phenomenon of elderly married couples. Even in youthful relationships, it is above all men who take care of the financial part. In same poll 63% of women aged 20-34 said they trusted men with long-term financial decisions. One reason: so I have more time for the children. Another: My husband knows more about investing. Another: everyone does what they do best.
None of these justifications convince me. The sharing of duties in marriage is correct, but it must be in a couple for the woman to also find time for existential decisions. When it comes to my disposition, this principle of delegation still stands still for me. Various evaluations and practices also show that men do not necessarily know more about finances than women. They just trust themselves more. Their stock accounts and investment successes look correspondingly risky and bad. Women could step in to smooth things over, eliminate the risk, and exercise more caution.
Today we women are financially incapable of collaborating only if we allow it. Whether it’s convenience, misunderstood consideration, or your traditional understanding of roles. Securing one’s livelihood belongs to the area of personal control. All time. Accumulating wealth is a matter for the boss, for both men and women. Of course, we would be happy to talk to the person with whom we share our life. Discuss everything, inform each other and choose gladly. Why not. And then please implement them separately on your own repositories.
Separate custody accounts secure your retirement provision
I’m not a fan of common deposits. Because everyone has unlimited access to the titles and can sell everything with just a few clicks. And retirement provision is gone, to name just one “worst case” among countless imaginable, ranging from bad general investments, high-risk investments with a total loss to overpriced insurance and investments with additional payment obligations.
But it’s also important to look carefully when buying a property. The man is often the only owner in the cadastre. He can thus sell the property without the consent of his wife. If a house is bought and paid for during the marriage, it belongs to both, each half is noted in the land register.
As investors, women are level-headed, knowledgeable, and risk-aware
The paradox is that when women are suddenly forced to take care of marital finances, they quickly realize how much joy it brings to know and make decisions. This financial independence gives confidence and increases self-confidence. Statistically, women are also the most successful investors because they invest prudently, well-informed and aware of risk. Why leave this capability idle?
Don’t incapacitate yourself financially in your relationships so that you don’t wake up angry and bitterly regret it when it’s too late and you are left without financial security in your old age. We should take to heart what widows and divorced women would say to their younger selves: think about your money and retirement savings; don’t make yourself dependent.
