How To Handle Income Inequality In Your Relationship

Financial issues can vary from not having enough money to dealing with overspending, but one area that’s a large contributor to relationship conflict is income inequality. When one partner earns more income than the other, complex issues can develop from either partner.

Types of conflict caused by income inequality

Although the situation is very commonplace in American households, financial inequality can cause a high degree of strain in the relationship. 

Financial conflict is highly nuanced and manifests differently in every relationship. It’s also heavily influenced by social and cultural expectations developed in childhood, as well as personal values. These expectations, combined with money and relationships, can surface feelings like inadequacy, unworthiness, and discontent, leading to stress and mental health problems.

Here are a few examples of what can develop when there’s financial tension between couples.

Guilt

The partner who earns less may feel guilty for not being able to bring in as much money into the household. These feelings can lead to denial of their own material wants and needs to prevent additional expenses. Ultimately, their feelings may severely limit their ability to feel happy with their quality of life. 

Higher-earning partners may also feel guilty about their financial position in the relationship. For example, they may downplay a new promotion and salary bump, because they feel guilty that their career has advanced further compared to their partner. This can negatively affect communication in the relationship, and make them feel taken advantage of if they feel their partner isn’t contributing.

Financial infidelity

Concealing spending habits may also come up when there’s income inequality. The partner who earns less may feel the need to cover-up their spending to avoid being judged for non-essential purchases.

For the person making a higher salary, they may feel shame for their own spending, choosing to hide their purchases to avoid “flaunting” their higher income around their partner. 

Financial power struggle

The partner who’s earning a higher salary may begin to feel like an authority on financial decisions, due to their larger contribution to the couple’s finances. This results in another layer of inequality within the household dynamic. If left unaddressed, it can bring up judgment and feelings of superiority beyond financial decisions. 

5 income inequality tips to work through with your partner

It’s important that couples are aligned financially from the very beginning, regardless of each person’s earnings. Putting together a financial plan encourages the growth of a prosperous relationship. Here are some ideas to help get you and your partner on level ground.

1. Create a budget

Creating a budget encourages communication by having both partners — regardless of income — agree on how the money is spent. A strong budgeting system will clear-up any concerns about where the money goes, and how much discretionary income each person enjoys. 

Each couple must determine what this breakdown looks like, but it has to be done together so no aforementioned feelings of resentment or guilt occur later. 

2. Agree on basic financial dynamics

Take a look at your current relationship dynamics — are contributions for shared bills equal? Who pays for dinner at a fancy restaurant? Do you manage separate accounts or pool your money together? 

These decisions let both partners feel in control of their financial situations. Encouraging feels of fairness is the fuel that maintains healthy, financial teamwork in a relationship. For example, you and your partner may agree that splitting shared household expenses 50/50 may be tough for the lower earner in the relationship, but shouldering date night costs are manageable for the partner who earns less.

3. Consider contributions outside of salary

This is one is crucial. In some situations, the person who brings less income may be contributing a high value in another area of the relationship than the high-salary earner. The person who earns less, for example, may stay at home to care for the children. 

This helps save money on shared childcare expenses which range from $4,000 to $22,600 annually, per child. Also, there’s also an opportunity cost of career advancement and lost salary due to staying home with the kids.

The same can be said for the person who maintains the home. With housekeepers charging between $20 and $40 an hour, it could be that the person who makes less is the largest contributor in the household. 

4. Schedule relationship meetings

The concept of a relationship meeting is to keep communication open. The concept is simple — like in the workplace, you have to deal with budget meetings and careful planning. The same can be done at home. 

Set up a meeting once a week where you can share needs, expectations, and responsibilities with your partner in an environment that’s conducive to a productive and healthy conversation. It can also be a good way to get your significant other on board with your financial goals. This way, both partners can express any financial concerns and work together to come up with resolutions together. 

5. Enjoy money together

Finally, in order for couples to both feel a sense of ownership regarding spending habits and contributions, a reward for successfully budgeting can be a shared activity. 

This may look like a vacation together or having a day to treat yourselves to purchases and activities that you both enjoy. These shared rewards help you both celebrate the hard work you’ve put toward building a healthy financial relationship.

These tips are meant to help you and your partner feel like active participants in your joint financial journey. If you need additional help, seeking support through an objective third-party, like a couple’s counselor, can encourage couples to explore deeply rooted emotions tied to money and relationships.