Paramount Pictures
Charlotte*, 31, has been married to her husband for ten years. Like increasing numbers of millennials and Gen Zs, they’ve opted to keep their finances separate. “Since the beginning of our relationship, we’ve shared the opinion that you should pay your own way,” Charlotte tells marie claire. She says she and her husband split things 50/50 and spend and save their own money how they want.
The old notion of getting hitched and pooling your income has waned over the last ten years. In 2021, a survey by YouGov found 75% of Australian millennials believed traditional joint accounts were “not suited for modern relationships.” Meanwhile, a 2023 US survey from Bankrate found that 43% of Gen Z and 31% of millennials preferred to keep all of their accounts separate. This was lower amongst older generations and couples with shared expenses like school and mortgages; here, the figure was 20%.
Why Are Young Couples Opting Out Of Sharing Their Finances?
So, what are the factors keeping young couples from counting their pennies together?
Millennials and Gen Zs were the first two generations to be raised in an era where divorce was normalised—boomers divorced more than any other generation, and they are continuing to divorce. Between 1990 and 2012, the divorce rate for people aged 55-64 doubled with experts referring to it as the rise of the “grey divorce.”
Many of us who saw our parents split, remarry, and struggle with the complexity of asset management have been left unimpressed by the old-school method of sharing finances.
For Charlotte and her husband, the decision is about respecting individual levels of financial literacy and risk tolerance. It’s also about privacy. “We both believe in maintaining a healthy balance by not having too much visibility into each other’s spending or earnings,” she says. “For example, if one of us is earning more than the other, we don’t want to feel competitive or make the other person feel inferior for earning less.”
Charlotte says she and her partner do have joint accounts for shared expenses like groceries, bills and subscriptions, and they plan to use joint accounts in future when school fees and expensive family trips enter the picture. But for now, they’re comfortable keeping things 50/50. “When we bought our first home, an investment property, we split the house deposit and mortgage repayments 50/50. We’ve bought a second place we currently live in and are using the same approach.”
Millennials and Gen Zs were the first two generations to be raised in an era where divorce was normalised—boomers divorced more than any other generation, and they are continuing to divorce. Between 1990 and 2012, the divorce rate for people aged 55-64 doubled with experts referring to it as the rise of the “grey divorce.”
Many of us who saw our parents split, remarry, and struggle with the complexity of asset management have been left unimpressed by the old-school method of sharing finances.
The Legal Risks Of Shared Finances
But does keeping our finances separate really increase our independence or protect us from legal risk?
Annelis Bos is a partner at Coote Family Lawyers, she says that separating finances can “create a feeling of fairness and independence in a relationship”.
And for women, maintaining control over one’s finances can feel important. We grew up with horror stories of messy divorces, and it feels like every week, grim data about the ubiquity of financial abuse is emerging.
In 2023, the Australian Bureau of Statistics revealed that 78% of their respondents reported a previous partner having exhibited financially “sabotaging” behaviour, which ranged from refusing to contribute to expenses, delaying property settlements following a separation and destroying property. With this information circulating, protecting your own finances feels like an obvious choice.
However, isolating your finances carries significant risks if the balance in the relationship is uneven or changes.
“If one person is a stay-at-home parent and the other earns an income – separating finances can become problematic. The person who doesn’t earn money can become reliant on the person with access to funds and ultimately lose financial control. This can sometimes stray into financial abuse territory.”
Can You Protect Your Money From Your Partner Without A Prenup?
Bos points out that while many couples who keep their finances separate might feel like they’re protecting their wealth, there is effectively no way to protect yourself financially without a prenuptial agreement or financial agreement. She says people might try to safeguard their money by splitting it off into crypto, hiding it in PayPal accounts, or giving it to family members to safeguard. “In today’s digital age, everything is traceable; it’s very difficult to ring-fence accounts.”
“In Australia, keeping finances separate does not legally protect assets during a separation. It doesn’t matter if the account was in one person’s name or joint names, the assets are considered in the one pool.” Essentially? While sharing or not sharing finances comes down to personal choice and carries pros and cons, without a formal legal agreement “there’s no effective way to quarantine your assets.”
*Names have been changed to protect interviewees identity
Related Posts:
- Strange Details Hiding In Jennifer Lopez’s Divorce Filing
- I’m 32 And My Friends Are Starting To Separate: Is This Our ‘Divorce Era’?
- How Much Does A Divorce Really Cost?
Related stories
Native ad body.
Native ad body.
Native ad body.
