Younger couples keep finances separate in case of divorce - Marcia Mediation

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Money worries can play a big part in divorce, whether they are one of the factors that lead to the breakdown of the relationship, or influence the way you choose to divorce and the cost of doing so.

Divorce mediators like Marcia Mediation aim to keep the process running smoothly and get you to a final agreement as quickly as possible, with minimal stress and crucially, minimal cost compared with going to court for those negotiations.

This is a key part of the divorce mediation process, but it seems that a growing number of couples are planning ahead by keeping individual bank accounts throughout the time they are together.

Recently published research indicates that younger couples are increasingly keeping their finances separate – rather than putting everything into a joint account – in part so it is easier if they decide to divorce.

Living separate financial lives

The survey by financial management provider Netwealth shows that 29% of all women who have been in a relationship chose not to give their partner direct access to their assets.

There are a number of reasons for this, including women’s higher earnings than in previous generations, an increase in couples waiting until later in life to get married, and caution stemming from the higher divorce rates of present times too.

Younger couples in particular are significantly more likely to keep their finances separate from one another – 26% of those aged over 55 have separate accounts, compared with 31% of those aged under 35.

Is there a gender divide?

Concerns about financial security in the event of separating are not just a female thing – the research found a broadly even split between the sexes on this issue.

Women were slightly more likely to cite separation as a reason to keep separate finances, with 23% giving this as a reason, but at 21% of men, the difference was relatively small.

For many women, separate finances are also about maintaining independence while still in the relationship, as some of the other reasons cited show:

  • To maintain financial independence (45% of women vs. 37% of men)
  • To manage their money as they choose (40% vs. 36%)
  • To spend money as and when they choose (26% vs. 23%)

It’s interesting to see that many couples, and especially women, want the same independence throughout their relationship – for a variety of reasons – that can also make it easier to divide assets if they later choose to divorce.

High-earners and financial independence

Perhaps unsurprisingly, Netwealth found that the higher a typical woman’s income, the more likely she is to keep her money separate from her partner’s.

Among those who earn under £45,000 a year, 18% have separate accounts; for those earning more, that figure rises to 29%.

Charlotte Ransom, CEO of Netwealth, writes in the report’s foreword: “Women are entering relationships with their own wealth and a history of managing their money independently and autonomously.

“Added to this is the daunting reality that two in five (42%) marriages now end in divorce, encouraging a more pragmatic approach to personal finance.”

At Marcia Mediation, we’re prepared to help you through all financial aspects of divorce. Get in touch with us if you’d like some help.