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Does Sudden Wealth Contribute to a Divorce?
There are several reasons why couples get divorced, including infidelity, lack of commitment, and unrealistic expectations. While couples often experience marital stress when having trouble making ends meet, a sudden and significant increase in income can also cause couples to divorce.
Researchers from New York University, Stockholm School of Economics and the University of Barcelona conducted a study to determine whether a sudden and substantial increase in financial status will increase the risk of divorce. The study found that men are more likely to get married and have children and are less likely to pursue a divorce. However, sudden wealth seemingly affects women differently. While it does not affect their likelihood of getting married or having children, it does make them much more likely to seek a divorce. According to the study, women whose economic prospects increased suddenly were twice as likely to initiate a divorce.
For decades, economists have tried to test the theory that more financially independent women are more likely to seek a divorce than women financially dependent on their spouses. However, obtaining the data to prove this theory has been challenging. The solution researchers came up with was to study winners of the Swedish lottery to determine whether the sudden wealth had an impact on their marriage and how long it took certain individuals to pursue a divorce. Winners were chosen randomly, which mimicked the conditions of a randomized control trial. Researchers then created large samples of lottery winners and non-winners and merged them with other data, including income, marriages, divorces, and births. They found the following results:
- An unmarried man who wins a lottery prize of approximately $96,000 is 30 percent more likely to get married within five years.
- If married, men are 40 percent less likely to get a divorce within 10 years.
- Men are also 14 percent more likely to have children, whether married or not, within 10 years.
- Unlike men, women who won the lottery were nearly twice as likely to get divorced in the years immediately following the lottery win.
The research also disproves the idea that young adults wait to get married until they are financially stable.
Wealth tends to increase the marriage prospects for men more than women. While this may be because men and women value their partners’ earning potential, intelligence, and social status more than men do, the study results do not confirm this.
How Does Sudden Wealth Impact the Equitable Distribution of Property?
If you or your spouse came into a great deal of money quickly, and you are getting a high-asset divorce, contacting a lawyer with wealth management experience is in your best interest. A sudden increase in finances means a significant increase in marital assets. A lawyer with wealth management experience can assist you with financial planning for your children’s future, including setting up 529 plans, cash value insurance, and Roth IRA accounts.
What Are Other Common Examples of How Finances Affect Divorce Rates?
According to one Ramsey Solutions study, money-related issues are the second leading cause of divorce. Close to half of couples with $50,000 or more in debt say money is the main reason for their fights. In most cases, this applies to couples with high levels or debt, which can cause significant stress and anxiety. The following are common financial issues that can lead to divorce:
- Disagreeing about how to handle money.
- Different priorities when it comes to money.
- Credit card debt.
- Maintaining secret accounts, undisclosed debt, or being dishonest about finances.
- Spending more than you have.
- Unwillingness to compromise on spending.
- Disagreements over major impulse purchases.
- Stress from combining bank accounts.
- Unexpected major expenses.
- Spending too much money on the wedding.
- Failure to seek premarital financial counseling.
- Loss of financial control.
Mendham Divorce Lawyers at Lyons & Associates, P.C. Assist Clients With High-Asset Divorces
If you have come into a sudden and substantial amount of money and are seeking a divorce, do not hesitate to contact our Mendham divorce lawyers at Lyons & Associates, P.C. To schedule a free, confidential consultation, call us today at 908-575-9777 or contact us online. Located in Somerville, Morristown, and Freehold, New Jersey, we serve clients in Somerset, Woodbridge, Morristown, Parsippany, Rockaway, Short Hills, Chatham, Randolph, Madison, Morris Plains, and Monmouth County.