Remarrying? Say 'I won't' to money
To hear Frank Sinatra sing it, love is lovelier
the second time around.
But can you imagine old blue eyes crooning,
"Love's more financially complicated, the second time around."
Well, it is. Not that it wasn't tough the first
The sad truth is that half of all second marriages
in the United States end exactly where the first ones did -- in
divorce court. And the major reason is the same: money.
"Money is the leading cause of divorce
in the United States," says Steven Pybrum, author of Money
and Marriage: Making It Work Together.
Making a second, or third, marriage work requires
all the love you can find, but handling your newly blended finances
as well as you handle your newly blended families is a key to staying
both maritally and financially healthy.
And you can do it!
Money matters matter
Jaine and James Carter, work/family experts and authors of He
Works/She Works agree. "The No. 1 problem that all
marriages have is money. All couples have the same kind of issues
the second time around, but what we have is more obligations without
necessarily more income."
Kathleen Miller, author of Fair
Share Divorce for Women, admits money problems are both
predictable and frustrating. "It's so easy to get married and
so costly and involved to get divorced that I don't understand why
somebody doesn't spend a little time talking about the financial
and business aspects of marriage."
Although the U.S. Census Bureau stopped compiling
national marriage statistics in 1990, it is estimated that Americans
have married and divorced in roughly equal numbers throughout the
past decade. Among those who divorce, three out of four will remarry,
usually within three years. When you do the math, it's little wonder
that the average American family today is actually the stepfamily.
For richer, for poorer
It's pretty easy to understand why most couples avoid "the
money talk," even the second time around. After all, it's love,
man! You window shop for a diamond, not a CD rate.
And that's precisely the problem.
"For 85 percent of married couples in America,
it is very difficult to sit down at their own kitchen table eye
to eye and talk about money issues," says Pybrum. "Resentments
build up until there is an explosion over something else, when the
root of it is how money is being spent in the household."
Those resentments can begin with little differences
in the money management styles we learned from our parents, relatives
and friends. Often, when the first marriage ends, people blame it
on their spouse and enter into the second marriage without any better
knowledge of their own strengths and weaknesses in handling money.
The failure rate of second marriages seems to indicate that they
then make the same mistakes again.
"A lot of people don't take that inward
look at what went wrong in the first marriage to make themselves
more apt to be lifetime partners in the second marriage," says
Especially when it comes to the marriage's finances.
Beating the odds
How does a wiser couple beat the odds the second time around?
Here's what the experts suggest to keep money
problems from intruding on your bliss. And, they say, don't think
of them negatively -- you only do that because you don't want to
talk about them:
- Separate accounts
For two-income couples where one or both
parties have child support obligations, it is a good idea to establish
three checking accounts: yours, mine and ours. Each person then
contributes a specified dollar amount or percent of income each
month to the joint account, which is used to pay the mortgage
or rent, household expenses such as food and utilities, and vacations.
Child support would come out of the individual's account; savings
would go into their separate accounts.
"The male may have alimony and child support payments,"
says James Carter. "If we were to merge our income as well
as our savings accounts, there is no doubt that it will lead to
resentment. Here's what happens: We put money in a joint account,
but every month she has to send $450 to his past wife. She'd have
to be an angel not to be resentful."
- "Don't ask" accounts
Even couples without outside obligations
might consider opening separate "don't ask" accounts
-- money that is theirs alone to spend.
"If you look at our parents' generation, there was only one
way that you dealt with money as a married couple and that was
the joint account," says Pybrum. "The more comfortable
way today is to have the combination of joint and separate accounts.
It takes a lot of frustration out of it because we each have access
to our little mad money."
- Separate credit history
The important thing here is, get one. Should
divorce loom on the horizon, a credit card in your own name can
help jumpstart a new life.
"It's important to get that because it can be really hard
to get once you're divorced," advises Miller. "Get that
history. One of the bad things about getting joint credit cards
is, as far as the credit card company is concerned, you both are
liable for that debt."
"One of the biggest tragedies I've seen is when a couple
divorces and one of them skips out on the credit card bills and
the other one is stuck with them," says Jaine Carter. "One
woman told me she paid for the engagement ring of (her ex-husband's)
second wife ... he had put (it) on their joint credit card,
then subsequently declared bankruptcy. In order to keep her credit
good, she paid off the bill."
- Income tax filing
Bear in mind that if you file a joint tax
return, you are both responsible for payment of all taxes. If
you file separate returns, you are each responsible for your own
- Marital property
In general, most items of wealth (money,
real estate, investments, personal possessions, etc.) acquired
during a marriage are considered marital property. In most states
except community property states (Arizona, California, Idaho,
Louisiana, Nevada, New Mexico, Texas and Washington), earned income
is considered individual property. It might be a good idea to
know how your property would be divided in your state of residence.
Inheritance and other gifts you receive
during your new marriage remain your sole property. That doesn't
mean you can't share and enjoy them, however.
"You can put some of your inheritance into the community
between the two of you, but just keep a record of it," advises
Miller. "It doesn't mean the family can't enjoy some of it,
but don't throw it all in, because once you throw it into the
pot and you get a divorce, it's almost impossible to get it out."
- Prenuptial agreements
Sure, prenuptial agreements sound scary. But
experts agree they're a good idea when they're used to prompt
open and honest talk about your new financial reality.
"We believe in them, even if this isn't your first marriage
and even if you're not millionaires," says Jaine Carter.
"Some say, 'If you loved me, you wouldn't make money an issue.'
That's the most childish argument I've ever heard. It's like a
little kid who wants everything on the shelf at Toys 'R' Us. They're
not living in the real world."
Says Pybrum, "It's a modern-day thing to do to write down
anything you agree to do."
Realize that talking openly about finances can
be like talking about which house or car to buy, or choosing which
restaurant or movie to go to -- you don't stop loving each other
if you disagree.
Don't be surprised if arguments arise, say the
experts. There will be differences of opinion, but they'll be on
the surface, manageable and not powerful enough to destroy you.
Talk, talk, talk
If couples would do nothing more than sit down and discuss money
with each other, their chances of a long and happy life together
would likely increase dramatically. Counseling doesn't always help.
Pybrum points out that marriage counselors are no more prepared
to discuss your money problems than accountants are to advise you
on your love life. Ultimately, the long-term answer to our coin-toss
divorce rate is education.
"As educated as the country is, 95 percent
of the country is financially incapable of retiring in the style
they wish they could. They haven't put forth enough information
in the school system to train people in the art and science of building
net worth, therefore we are just by default in this mode of earn,
spend, earn, spend, earn, spend, and forever keep ourselves on a
And so, a toast to the bride and groom: "May
you be happy and healthy forever, and may money never come between
Jay MacDonald is a contributing
editor based in Mississippi.
-- Updated: Feb. 01, 2001