Jan 20 2014, 9:22am CST | by Forbes
Last week, The Atlantic ran a piece highlighting the fact that wealthy women have the relative privilege of deciding whether or not to marry without having their economic well-being hinging on the decision, while poor women don’t have the same latitude. For those Americans who aren’t high earners, matrimony makes as much if not more financial sense than it does romantic. The piece started me wondering if marriage is better or worse bet depending on which generation you belong to – specifically, is marriage a good economic choice for Millennials?
As a whole, Millennials are less enthusiastic about marriage than older generations, although the majority still want to get hitched at some point. According to a Gallup poll from August, 28% of 18 – 34 year olds are currently married, while 56% are unmarried but aspire to the institution. While 3% of Gen X and 4% of Baby Boomers have never been married and don’t want to be, that figure jumps to 9% for Gen Y. Among Millennials, those who were earning more than $75K a year were actually the most likely to be married by a wide margin – 51% compared to 19% for the lowest earning Millennials (<$30K) and 21% for those pulling in mid-range salaries ($30 – $75K). As well, top earning Millennials were less likely to say they never wanted to marry (6%) compared to the other groups (both at 8%). As Gallup sums up:
“…while most younger Americans who have never married express an attitudinal interest in eventually doing so, fewer hold the underlying attitude that such an action is important. The reasons Americans who have never married yet want to be married give for why they have not yet married support the idea that getting married is to some degree a matter of timing and convenience rather than necessity, as most reasons have to do with waiting for the right partner or the right time.”
While the marriage premium – the additional earnings married workers collect over their single colleagues – is declining, it still exists. Being married – whether now or later – does convey economic benefits. Research from the University of Michigan shows that married women earn 4% more than unmarried women and married men earn 7% more than single counterparts. In light of the fact that Millennials are poised to underearn their parents, it may seem counterintuitive that they would put off a life decision that would allow them to boost their household income, but there’s a financial logic to it. It turns out that delaying marriage actually makes economic sense for Millennials, especially Millennial women. As The L.A. Times reports:
“Those who finish college and get married after turning 30 earn $18,152 more per year, on average, than women who marry in their 20s or teens. Even women who are high school graduates but don’t finish college earn $4,052 more per year, on average, than women who marry when they’re younger.”
Putting off marriage leaves more time for higher education and for taking high ROI career risks – both long-term income boosters – that might not be possible if you’re worried about saving up for a down payment or budgeting to start a family. Instead of viewing marriage as a stepping stone to greater economic stability, it seems as if Millennials see economic stability as a prerequisite for marriage. And while most Millennials still aspire to take trip down the aisle, they aren’t putting much stock in it as an indicator of having a successful life. A scant 30% claim that a successful marriage is an important achievement for them, well behind priorities such as having a high-earning career or being a good parent.
Marriage might make sense for Millenials, but they’re in no hurry to take the plunge.
Source: Forbes Business
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