Academic journal article Family Relations

Examining the Relationship between Financial Issues and Divorce

Academic journal article Family Relations

Examining the Relationship between Financial Issues and Divorce

Article excerpt

Using longitudinal data from the National Survey of Families and Households and both wife- and husband-reported data (N = 4,574 couples), this study examined how financial wellbeing, financial disagreements, and perceptions of financial inequity were associated with the likelihood of divorce. When financial disagreements were in the model, financial well-being was not associated with divorce. Both wives' and husbands 'financial disagreements were the strongest disagreement types to predict divorce. Mediators derived from systems theory (conflict tactics) and social exchange theory (marital satisfaction) fully mediated the association between financial disagreement and the hazard of divorce. Finally, financial disagreements fully mediated the association between perceptions of financial inequity and divorce. These findings suggest that financial disagreements are stronger predictors of divorce relative to other common marital disagreements. They further suggest that financial disagreements (e.g., "content") are associated with marital process.

Key Words: divorce, family resource management, family stress and conflict, gender.

The 2007-2009 recession heightened scholarly and public awareness of the association between financial issues and adult romantic relationships. Academic journals published studies that linked financial welt-being and changes in marital satisfaction (Britt, Grable, Nelson-Goff, & White, 2008; Dew, 2009). Media outlets and research centers also informed the popular discussion using scholarly research (e.g., Mannes, 2009; Wilcox, 2009).

Although research has shown how financial issues might influence relationship quality, the evidence regarding divorce is mixed. Some studies have shown that financial issues are important predictors of divorce (Amato & Rogers, 1997; Britt & Huston, 2012; Dew, 2009, 201 1). Other studies have found little relationship between financial issues and divorce (Andersen, 2005; Sanchez & Gager, 2000; Stanley, Markman, & Whitton, 2002). These inconsistencies may stem from differences in specifying the context of financial issues, modeling, data, methods, or a combination of these.

Research in this area exhibits shortcomings that limit scholarly understanding of whether, and how, financial issues are involved in divorce. For example, some of these studies do not test how financial issues compare to other common marital problems vis-à-vis divorce. This is problematic because studies have shown that financial disagreements are more salient to couples, are less easily resolved, and relate to more problematic conflict tactics compared to other common disagreements (Dew & Dakin, 2011; Papp, Cummings, & Goeke-Morey, 2009; Stanley et al., 2002). Further, most studies fail to test the mediating mechanisms that might link financial disagreements and divorce. Additionally, the studies cited above examine only one aspect of financial issues. Sanchez and Gager (2000) and Dew (2009) assessed financial wellbeing, whereas Amato and Rogers (1997) and Andersen (2005) tested participants' perceptions of their spouse's money handling. Testing only one area fails to acknowledge the multidimensional nature of money in marriage (Jenkins, Stanley, Bailey, & Markman, 2002; Shapiro, 2007), thus limiting our understanding of how money is associated with relationship functions.

This study contributes to research on the association between financial issues and divorce in three major ways. First, this study compared the ability of financial disagreements to predict divorce with other types of marital disagreements to assess the relative strength of financial issues as a predictor. Second, this study simultaneously tested three theories (i.e., family systems theory, socia! exchange theory, and distributive justice theory) that may explain the relationship between financial issues and divorce. Third, unlike previous studies, this study examined multiple financial domains - the frequency of financial disagreements, financial well-being, and perceived financial unfairness - using nationally representative longitudinal data. …

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