Stuff.co.nz Business 13 March 2012
Most of the international research suggests that marriage increases the wealth of couples substantially, so that engagement ring might just be the best investment you make. There’s not much local research to go by, but a United States longitudinal study found married respondents increased their net worth by a colossal 77 per cent more than those living the single life. Sociologists and economists alike scratch their heads over exactly why this is so. Popular theories include greater work ethic from people with family to support, and the cost efficiencies of shared living. “The advantage of two people getting together and combining resources is obviously you can leverage yourself into, for instance, buying a property,” Stuart says….
The knowledge that getting hitched will slash your income by thousands of dollars could cast a cloud over the most jubilant wedding celebration. “It’s a huge disincentive, if you figure it out just in terms of income levels of the household,” says Bob McCoskrie, national director of conservative lobby group Family First NZ. In 2008, his group commissioned the New Zealand Institute of Economic Research to undertake some research around marital income – with interesting results. What the report found were “marriage penalties” – parents would typically receive a higher total income if they separated, even after taking added living costs into account. Let’s say you’re married with a couple of kids, and the sole breadwinner is pulling in $52,000. Living apart, your combined income would be more than $5,000 higher, despite the higher accommodation costs. That gap gets even wider with two salaries. If mum works part-time and earns $12,480, and dad is still earning his $52,000, they’d actually be better off split up, to the tune of $9,325. Ironically, marriage is not such a losing proposition if you don’t have offspring running around underfoot. The penalties are higher for families with children because there’s more government assistance targeted at them. For those like McCoskrie who believe marriage is a founding pillar of society, it’s something of a bugbear: “If you’re wanting to promote stability in homes, why are families who are married being financially penalised, as opposed to those where there is separation or even divorce?”