| November 18, 2016

Research of the Week: Savers, Spenders, and Love

Don’t let money ruin your relationships.

Each week, Consolidated Credit searches for financial research that can help you deal with your debt and budget. This week…

The interesting study

Everyone knows couples fight about money. But what happens when young lovers first meet? What role does money play? That’s what the investment firm TD Ameritrade wanted to know when it conducted its annual Millennials and Money Survey.

The big result

Love and money investigated

When it comes to love and money, opposites don’t necessarily attract – and when they do, it can be a volatile combination.

TD Ameritrade interview more than 2,100 adults and asked them to identify themselves as a “spender” or “saver.” Not surprisingly, around 60 percent of men and women who called themselves savers sought spouses who also were good at saving. The big reason was obvious: “One benefit 6 in 10 Savers noted for being married to another Saver is that it prevents arguments.”

What about those who called themselves spenders?  Men and women acted very differently: “A majority of Spender women (59 percent) married a Saver spouse, as opposed to 39 percent of Spender men with a Saver spouse.”

The fascinating details

As you might expect, Millennials and Baby Boomers have different ideas about love and money…

  • “Two-thirds of Boomer Savers are married to Savers, compared to 52 percent of Millennial Savers”
  • “40 percent of Boomer Savers say they would not be happy in a relationship with a Spender vs. 23 percent of Millennial Savers.”

Even among Millennials, there’s a gaping gender gap when it comes to saving money. For instance, nearly two-thirds of women are saving for an emergency fund. Men? Only half.

What you can do

Well, one thing you shouldn’t do, according to experts, is break up with the love of your life just because they’re a spender.

“It’s more about attaining the right balance than finding an identical match,” says Matt Sadowsky, TD Ameritrade’s director of retirement. “It’s not critical that both spouses be spenders or both be savers. But it is critical that there is an open dialogue between the two.”

Indeed, Consolidated Credit president Gary Herman says he’s seen savers reform spenders.

“If couples talk openly about not only how they spend, but what their lifelong goals are, then saving becomes a specific task instead of a general idea,” Herman says. “It’s much easier to resist the temptation to open your wallet when you want to have a child in the next year, or go back to college to enhance your career.”

Of course, Herman has also seen the flip side: Spenders luring savers to the dark side.

“Without that honest money conversation and at least some basic budgeting, savers run the risk of giving into their spending spouses,” Herman says. “The results can be devastating. I’ve seen it for myself these past two decades here at Consolidated Credit. Luckily, we have the experience to not only get these couples out of debt, but keep them out of debt in the future.”

Consolidated Credit has put much of that knowledge into a special report called Love & Money: Good Finance without the Fights. Check it out, and call for a free debt analysis from a certified credit counselor.

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