Thu, 01 February 2024 | consumers spending
Every February, Americans celebrate their commitment to one another, shining a bright light on love and relationships. However, the Fidelity Investments® 2024 Couples and Money study reveals that couples may not be as compatible as they believe, with 45% of partners admitting they argue about money at least occasionally. While over one-fourth of couples say money is the biggest obstacle in their relationship, there is good news: over half of respondents feel very good or outstanding about their financial situation, and 27% of boomers say their love language is creating a financial plan together.
The study by Fidelity, which has been going on since 2007, is special in that it polls each couple separately before compiling their responses to assess and determine what areas of communication and money management the couple is doing well and where more work needs to be done to move the relationship forward on their priorities, which range from debt repayment to bill balancing. Couples give themselves high grades when it comes to the fundamentals of any relationship; almost nine out of ten say they communicate well or very well with their partner, suggesting that open communication may be a key to navigating financial success.
According to Meredith Stoddard, vice president of education at Fidelity Investments, "Money conversations can be daunting for couples, especially when they have competing priorities or different visions for how they should be spending, saving, and investing." “Open channels of communication are essential to any successful partnership and boost people's self-esteem, particularly when navigating expectations and financial conversations.”
Even though most couples say they collaborate when making financial decisions, 1 in 5 key decision makers acknowledge that they grow irritated when they have to handle things on their own. Furthermore, over 33% of couples are off base when it comes to their partner's income; 27% acknowledge that they are frequently irritated by their partner's financial behavior, but they choose to overlook it in order to maintain harmony. In addition to their communication breakdown, partners voice worries about retirement, emergency finances, and leading the life they've always wanted. Furthermore, Gen Z expresses worry about feeling financially secure enough to have and support children (54%), as well as about having enough money to buy a home (57%).
Couples generally have similar ideas about how they want to spend their retirement: with friends, family, traveling, and engaging in their hobbies. Nevertheless, a majority of married couples (53%) who have not yet reached retirement have divergent opinions about the amount of savings required for retirement. Moreover, even though the majority of couples plan to retire at age 63, almost half of them plan to continue working part-time after retirement. This could be due to financial need or the decision made by certain couples to follow new interests after retirement.
The study's findings indicate that for relationships to achieve financial harmony, there has to be more communication and collaborative decision-making. Among other interesting patterns, almost one-third of couples say they differ about their future big financial objectives. Furthermore, women are much more likely than men to believe that their partners are more knowledgeable about investing-related subjects; 57% of women say their partner is more knowledgeable than they are (40%).