Couples have trouble talking about money. In fact, the problem is so severe that a large proportion of couples admit they cannot even come close to saying how much their partners make for a living, according to Fidelity Investments.
The information gap shows that many couples need help navigating the challenges of their shared financial lives, Fidelity said in its "2021 Couples & Money Study,” released Thursday.
“The good news from the study is that most couples (71%) feel they are communicating well, which results in their raising their financial health and makes finances less of a challenge,” said Stacey Watson, Fidelity's senior vice president of life event planning, in an interview Thursday. “In addition, more women are getting involved in both short-term and long-term planning. That is encouraging.”
But there are still communication problems between partners when it comes to discussing their earnings, spending and saving. Thirty-nine percent of the 1,713 couples Fidelity surveyed could not say how much their partners make, the study found. When asked to guess, 9% of the respondents were off by more than $25,000, Fidelity said.
In addition, Watson said, “half of the couples were not aligned on how much they will need to retire. Those two data points show there is an opportunity for more communication.” If couples communicate more, “they are more likely to reach their goals and they are less likely to argue about money.”
Nearly half of all couples disagreed on the age they expect to retire, and “52% confessed they do not know how much they need to have saved to maintain their current lifestyle once they leave the workforce,” the study said. How to afford healthcare expenses in retirement is by far the biggest concern for all generations.
Only 57% of respondents said they are joint decision makers when it comes to retirement and long-term planning.
Fidelity advised that couples need to make finances “a team sport.” “Make a plan to talk about finances on a regular basis,” Watson said.
“Money discussions are not always easy, but the fact so many couples feel they are in sync and are comfortable talking about financial topics is encouraging, even if the conversations do occasionally end in disagreement,” Watson said in a statement.
Fidelity points out that one out of four millennials identify money as their greatest relationship challenge, a higher rate than other generations.