The Supposed Economic Benefits Of Marriage Could Be Outweighed By The Financial Risk Of Divorce
A lot of these articles are misleading (perhaps unintentionally). Sure, having two people with two incomes supporting one heinously expensive household instead of two heinously expensive households has obvious benefits. While there are plenty of ways to live under one roof with other people that are not marriage, marriage is the one that the broader society fully embraces, and it does structuralize commitment a lot more than other alternatives.
However, marriage also entails a huge financial risk in that about 40% of first marriages end in divorce (take this as an approximation, given that high-quality statistics on this figure are not assembled very often, and the proportion of people getting divorced changes over time). Second and subsequent marriages have an even higher chance of — well, failure seems like a harsh word for it, so, let’s just say a higher chance of ending short of death.
When it comes to the costs those unlucky 40% or so incur, again, good statistics on how much a divorce costs are not easy to find, and the figure is going to vary wildly in different geographical areas. That being said, a recent article in Forbes puts the average cost of a divorce in America in 2023 at between $15,000 and $20,000. (I’ve seen plenty go well into the six figures though, as has any lawyer who works at a sizeable law firm).
That $15,000 to $20,000 figure is low in terms of a comprehensive cost picture, because it does not encompass much. It only includes divorce transaction costs like the legal fees you pay your lawyer and court filing fees. There are many indirect costs on top of that. Some of these might include incidentals incurred by one or both parties from needing to move into a new home, lower productivity at work, having to go out and spend money impressing dates again, addressing mental health impacts, and, perhaps, getting to be less selective in choosing your next long-term romantic partner after having just gone through a ruinous divorce process.
Of course, those who get divorced, along with their wrecked financial lives, can afterward be cleanly swept into the statistical dustbin of single people. That is awfully convenient for those “singles are doing so much worse than married couples” statistics. And don’t forget the fact that marriage is already selecting for people who are more financially well-off to begin with (at least for men).
As a whole, married people are better off financially compared to single people. Yet, that is not due to some kind of structural advantage of the institution of marriage itself. Rather, when you take two people who were probably better off financially to begin with, saddle them with only one household’s expenses instead of two, make them owners of the same property that will build equity over time, and then look at their income and wealth figures separately from all those who used to be like them before the latter’s marriages imploded, yeah, married couples are going to look pretty good against singles. Not amazingly good though: the net worth of married households versus single households only differs by about $60,000.
Martial dissolution rates in the United States are the lowest they have been in decades. Still, the odds of divorce being the end result in any marriage remain troublingly high. No one would get on a plane that had a four in 10 chance of going down, even if the six other times it made it somewhere great.
Keep in mind too that weddings are a $70 billion industry in the U.S. and divorces are a $28 billion industry, whereas no one makes any money by saying, “Eh, you’re probably fine in whatever kind of relationship you’re in without blindly entering into what amounts to a legally binding contract about it.” Consider the sources. Just to give you some context, and because it’s fun, also consider that the combined annual American marriage and divorce industries are almost on par economically with the size of the domestic auto manufacturing industry. That is a ton of money.
So, if you’re single, don’t feel ashamed by all the attention-grabbing headlines about how your married peers are outperforming you financially. Maybe they are — for now. But unlike them, you don’t have a huge ever-threatening risk built into your net worth. Hey, for what it’s worth, I’ve always personally found that having a long-term girlfriend is a pretty satisfying way to go through life.
Jonathan Wolf is a civil litigator and author of Your Debt-Free JD (affiliate link). He has taught legal writing, written for a wide variety of publications, and made it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached at jon_wolf@hotmail.com.