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Do financial differences cause many divorces?

On Behalf of | Nov 11, 2021 | Divorce

Spouses file for divorce in California for several reasons, with irreconcilable differences being a common one. Spouses may drift apart and cease to have a workable marriage. Differences in beliefs and attitudes factor into the breakup, and the two partners’ disagreement could entail financial matters. Not everyone is good with money, and one spouse might cause stress for the other due to financial missteps and decisions.

Financial issues and divorce cases

Disagreements over financial risks rank as a top cause for divorce among many spouses. A research study conducted by the University of California, San Diego’s Rady School of Management discovered that differences in spouses’ education levels and background factored into how they addressed financial risk.

The study noted that those with substantial differences in risk attitudes might find their marriage breaks apart at a higher rate than those on the same fiscal page. The study’s results may not be surprising to many since one person’s ideas about investing and putting money to work could be unacceptable to another, creating strain. One spouse might wish to invest money in a business venture that the other spouse deems “too risky.” A marriage might suffer substantial friction as a result.

Monetary risks and concerns for the future

Those worried about whether a spouse’s decisions may undermine retirement savings could lead to arguments and marital friction. One spouse may file for divorce upon fearing the other may lose a retirement nest egg due to poor financial decisions.

Worries about debt might factor into the marriage fraying. Poor financial decisions may result in lost savings and high loan obligations. Tax debts on a joint return could frighten a spouse wishing to avoid such costs.

The other spouse may be unhappy over not getting free reign to invest money. Ultimately, spouses divided on financial decisions might not what to keep their union together.