How single-income couples can remain financial equals

Many families become single-breadwinner households because of caregiving obligations or long-term unemployment during the pandemic

The non-working partner may have more time now to manage the family’s finances. Getty

Some couples mutually decide that they want to have a one-income household. But for others, the decision is made for them.

The Covid-19 pandemic left many in this situation, especially at its outset, when companies folded and jobs in hard-hit industries disappeared. And with schools and day cares closing so frequently, many couples may have felt it made sense to have a parent at home full time.

Such an upheaval can leave you both feeling powerless. Before, you operated as equals. Now, one of you worries about losing your independence while the other feels the added pressure to provide. Suddenly, your relationship dynamic isn’t the one you originally signed up for.

Any change can be hard, especially one that can make you rethink who you are — your identity, your purpose and your role within your family. But when it comes to making money-related decisions with your partner, the best path forward is a combination of logic and heart.

Acknowledge the emotional component

Even if you agree that one of you dropping out of the workforce is the best option for your family, both of you may feel conflicted.

Not only do your responsibilities change, but the way you view each other can also change, especially if part of what sparked your interest in your partner in the first place was their passion for their career.

“You align in this professional way — to then lose that, you might learn some things about your partner that maybe are not attractive, or you have to adjust to,” says Stacey Sherrell, a licensed marriage and family therapist in Glendale, California, who co-founded Decoding Couples, which provides courses, videos and other relationship support.

If you are the one staying at home, it is essentially similar to starting a new unpaid job that your previous work experience did not prepare you for.

Without an income, you might feel as if you no longer have as much of a say in financial matters. At the same time, you may welcome a break from trying to do it all, because now you will be able to focus solely on home responsibilities.

“I have actually seen clients have relief about not having a job any more,” Ms Sherrell says.

On the other hand, if you are the newly minted sole breadwinner, you might be wondering when you will get your break from juggling a career and family.

There is a lot of stress involved when you are the only person earning an income, even though your partner’s labour at home will give you extra time to focus on your career.

Prepare for the financial realities

With one of you at home (and the reduction in income), it is time to revisit your budget. Maybe you no longer need thrice-weekly takeouts, a professional dog walker or a cleaning service.

Depending on which chores the stay-at-home partner will take on, you will probably have some major costs you can scale back on.

Don’t forget about the valuable work benefits you may lose if you leave your job, such as access to life insurance through your employer, unused funds in your flexible spending account or stock options that you will have a limited time to exercise after you leave.

Before your last day at work, discuss these details with your company’s benefits person.

Here is a potentially sticky situation: allocating money for the stay-at-home partner for their own discretionary spending. Definitely budget for this, but whatever you do, Ms Sherrell says, do not call it an allowance.

“That word in itself alludes to, ‘I’m giving you something. This is mine and I am allowing you to have this in exchange for something’,” she says. “That in itself negates any ‘we’ language — we are deciding this together, we are a team, we are partners in this and this is how we are deciding to use our money.”

Recognise all the ways you both contribute

In some families, being the breadwinner can also mean being the chief decision-maker, and that is simply not fair.

“Money has become synonymous with ‘entitlement’ and that doesn’t work in a relationship,” says Rachel Facio, a licensed marriage and family therapist in Glendale, who co-founded Decoding Couples with Ms Sherrell.

“In an equal, thriving relationship, that doesn’t give you the master key to the castle. Society has to catch up on that change.”

The non-working partner has much to contribute when it comes to family finances. They already made spending, saving and investing decisions when they worked outside the home, and now they may have more time to manage the family’s finances.

Shari Greco Reiches — co-founder of Rappaport Reiches Capital Management in Skokie, Illinois — finds that stay-at-home partners make ideal financial planning clients.

“When I give them a list of things to do, they do them faster,” she says.

Check in with each other once a week, not only to review what each of you need to do to help keep things running, but also to give yourselves a distraction-free moment to talk openly.

“This is the time to lean into that discomfort and, counter-intuitively, be more vulnerable with your partner about what is going on,” Ms Sherrell says. “There has to be some kind of regular safe space to be able to talk about what is going on for each partner.”