Does Living Together Really Save Money? It Depends on Your Degree

July 6, 2011  |  

By Alexis Garrett Stodghill

More couples than ever are choosing shacking up over matrimony, with their numbers doubling since the ’90s, according to a new report released by The Pew Center. Its analysis of recent Census data revealed another discovery: unmarried college-educated couples who live together have a higher household income than similar married people. Unmarried partners earned a median sum of $106,400, while the legally wed took in a little less at $101,160.

These facts disprove the widely-held notion that marriage is the ideal financial arrangement for all. elaborates:

The report’s findings fly in the face of conventional wisdom that says married people have it better economically than their unmarried counterparts.

“When we started writing this report, we thought that people who were married, and not those just living with each other, would be better off. But that’s not the case,” said D’Vera Cohn, the study’s co-author.

The key is a college degree, Cohn said.

Cohabiting couples without college educations typically fare worse than comparably educated married couples and are on par with the economic means of an adult living without a partner, the study said.

In fact, “unmarried cohabiting couples who have only completed high school have a median income of $46,540,” while “married high school-educated couples have a combined salary of $56,800,” according to AOL’s MyDaily. So for those with only a high school diploma, marriage still provides greater stability — yet less than that of a single person with a college degree.

Pew found that college educated singles earn an average of $90,067, almost twice that of high school educated unmarried live-ins. Being single and college educated does not cause one to have a high salary — this is a statistical correlation. Yet, this correlation proves the importance of a college degree over marriage for creating wealth. Because of this, when college educated singles unite, they become an economic powerhouse.

The larger combined income of educated, unmarried partners enables these couples to save 1.4 times as much as couples who do not live together. Other factors contribute to their ability to save, such as the fact that only 67% of married couples count both spouses as earners, as opposed to 78% of unmarried loves.  More income automatically means more discretionary funds.

In addition, unmarried, college educated households have fewer children. Child rearing, for couples all along the education spectrum, leads partners to drop out of the workforce.

These findings portray remaining unmarried as an economic advantage — if one has a college degree. Being college educated can make living with a similar spouse a means for getting ahead, but one can also do pretty well alone. According to this new research, anyone without a college education else is better off getting hitched.

What do you think? Does being college educated trump marriage as a foundation for financial security? Or is there more to matrimony than money? Leave your comments on your personal experiences, and discuss.


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