What Are the Financial Benefits of Being Married?

Marriage is a word that often sparks thoughts of love, commitment, and lifelong partnership. But beyond the emotional bond, marriage is also a legal contract that comes with financial perks. 

From tax credits to inheritance rights, the financial benefits of marriage show how tying the knot can change your life in profound ways. 

5 Major Financial Benefits of Marriage

Few would tell you they married their partner to pay lower taxes, get car insurance discounts, or increase their retirement savings. 

While love should always be the foundation of any union, these financial perks of marriage are added bonuses that make saying “I do” even sweeter. 

1. Tax Advantages for Married Couples

How does getting married affect taxes? Well, one of the main financial benefits of marriage is that it can lower tax rates. The Internal Revenue Service (IRS) uses a progressive tax structure, where income is divided into different brackets, each taxed at increasing rates. Thus, the more you earn, the higher the percentage of taxes you pay.

However, when married couples file tax returns jointly, their combined income is taxed under married filing jointly brackets, which have wider income ranges than those for single filers. 

This is especially beneficial if one spouse earns significantly more, as more of the couple’s combined income falls into lower tax brackets. As a result, filing jointly can reduce your overall tax liability compared to filing separately.

Having access to various tax credits that are only available for married individuals filing jointly is among the tax benefits of marriage. For instance, the Child Tax Credit (CTC) allows you to receive a tax credit of $2,000 per child and per tax year, provided that your annual income doesn’t exceed $400,000.

2. Improved Loan and Credit Opportunities

Lenders will usually evaluate both partners’ debts, income, and credit histories to determine the interest rates or loan terms they get when they apply for mortgages, loans, or credit cards as a couple.

Marrying someone who increases your combined income without increasing total debt can help you qualify for a larger loan with lower interest rates and fees. 

Moreover, one of the perks of being married is that it can improve a couple’s borrowing opportunities if either spouse has a strong credit profile. Even if your credit score is low, your partner’s excellent credit history and habit of making timely payments can offset that. This simply means securing more favorable deals.

3. Lower Healthcare and Insurance Costs

One of the pros of marriage worth considering is its positive impact on one’s mental and physical well-being.

Research shows that unmarried individuals are more likely to experience symptoms of depression compared to those who are married. Studies also link marriage to fewer doctor visits, shorter hospital stays, and a lower risk of nursing home admissions.

These findings explain why long-term care costs tend to be lower for married couples. Many spouses provide informal care for each other, reducing the need for costly medical services. But marriage also lowers healthcare expenses in other ways.

If both you and your spouse have employer-sponsored health insurance, you can compare plans and enroll in the one offering the best coverage at the lowest cost. This often leads to substantial savings on health insurance premiums and extensive treatment plans.

Marriage may also reduce other insurance costs. You could qualify for lower auto insurance rates, homeowners or multi-car discounts, or joint life insurance policies with reduced premiums. Insurers often view married individuals as lower risk because they typically file fewer claims, maintain cleaner driving records, and demonstrate financial stability.

4. Better Retirement and Social Security Benefits

The financial benefits of marriage include Social Security benefits that enhance financial security during retirement, disability, or after a spouse’s death. 

If your earnings are significantly lower than your spouse’s, you may receive up to 50% of your full retirement age benefit. The Social Security Administration (SSA) specified the eligibility requirements for spousal benefits. 

To qualify, you must be at least 62, have a child under 16, or receive Social Security disability benefits. Additionally, your spouse must have already filed for their own retirement benefits.

If you become disabled but lack enough work credits for Social Security Disability Insurance (SSDI), you may qualify for disability benefits through your spouse’s work record. Furthermore, if your spouse passes away, you may be eligible to receive up to 100% of their benefit once you reach full retirement age, as long as you have not remarried before turning 60.

5. Wealth Building and Inheritance Laws

Suppose you want to accumulate long-term wealth to improve your and your family’s financial security and stability rather than set short-term financial goals. In that case, you can take advantage of the benefits of getting married. 

A married couple’s combined salaries allow them to invest more in retirement savings plans with tax benefits, such as 401(k) and IRA (Individual Retirement Arrangement). You can meet the maximum annual 401(k) contribution limit of $23,500, especially if your spouse’s salary is sufficient to cover household expenses. 

Higher contributions mean more funds benefiting from compounded and tax-advantaged investment returns, leading to exponential growth over time.

As one of the legal benefits of marriage, it also provides legal protections related to inheritance. Depending on state laws, a married person has the right to acquire the entire estate of their deceased spouse or a significant portion of it without tax consequences. 

When a person dies without a will or if their will does not clearly state how their estate will be disposed of, intestate succession laws usually prioritize the surviving spouse as the legal heir entitled to inherit the deceased spouse’s estate.

The exact amount they can receive depends on whether there are surviving children. If there are, the children generally receive equal shares of assets.

Comparing Financial Outcomes: Marriage vs. Single Life

When two people commit to love and care for each other through thick and thin, they create a strong bond. Thus, when they say, “What’s mine is yours, and yours is mine,” it means sharing finances, responsibilities, and resources.

For instance, a married person can save money fast on a low income when their partner pays some of their expenses. In contrast, single people often incur higher expenses while earning less.

Expenses and Cost of Living

Married couples can share financial responsibilities by splitting fixed costs like rent and flexible expenses such as utilities and groceries. Conversely, singles must cover all costs alone, making their housing and daily expenses higher.

The national average monthly rent for a one-bedroom apartment is $1,203. If two people rent an apartment separately, they pay this full amount. However, they cut their rent in half by moving in together and sharing one apartment.

When you’re married, you can also save money on groceries. For instance, you can buy groceries in bulk, which often have lower per-unit costs, without worrying about storage or food spoilage. 

Moreover, married couples can lower the electric bill by investing in solar panels, washing clothes together at coin-operated laundromats, and combining their home insurance policies to reduce costs.

Earning Potential 

The United States Census Bureau (USCB) found that married individuals earn an average annual income of $73,000, while single individuals make $56,065. Reflecting the economic benefits of marriage, this wage gap affects both men and women. 

However, a well-documented phenomenon called “marriage wage premium” shows that married men tend to earn more than their unmarried counterparts, even when accounting for factors like education, age, occupation, work experience, and industry.

There are various theories aiming to explain this gap. One suggests that the same qualities that contribute to higher earnings also make a person a more desirable partner, increasing the likelihood of marriage. 

Another theory proposes that marriage boosts men’s productivity, as women still handle most household responsibilities. This allows men to focus more on their careers.

Marriage may also influence job-search decisions. If you are married, you might rely on your partner’s income while searching for work, which gives you more time to look for a higher-paying position. However, if you are single and have no financial support, you may be forced to take the first available job rather than seek better opportunities. 

Financial Pitfalls To Avoid as a Married Couple

While there are financial benefits of marriage, money issues are among the leading sources of tension and stress in relationships. In fact, 34% of American couples have identified money as a source of conflict. Here are the most common financial pitfalls married couples face:

• Avoiding Conversations About Money

Many married couples shy away from financial discussions due to fear, shame, or conflicting perspectives. However, avoiding these talks can lead to resentment and poor decisions. 

To prevent this, schedule regular “money dates” where you and your partner can openly discuss concerns, spending habits, and goals. Honest conversations strengthen trust and help you make smarter financial choices together.

• The Dangers of Not Having Shared Financial Goals

Whether you want to start a family, take a vacation, or save to buy a house in six months, a shared financial vision is important. Without one, you and your partner may pull in different directions, creating frustration and financial strain. Set clear short- and long-term goals together, review them regularly, and adjust as needed to stay aligned.

• Ignoring a Partner’s Debt

If your partner has a lot of debt, ignoring it won’t shield you from its impact. Even if you’re not paying it off yourself, your family’s quality of life will be affected. 

Your spouse may struggle to cover their share of living expenses or afford vacations. Long-term, ongoing debt can derail retirement plans. The mistake is handling debt separately instead of tackling it as a team to protect your financial future.

• Overspending: A Costly Path to Financial Ruin

Many couples fail to establish a budget or live off a single income, resulting in overspending, limited savings, and constant financial uncertainty. To maximize the financial benefits of marriage and keep financial goals within reach, you should track your income and expenses together and avoid stretching your finances too thin.

There are many ways to avoid overspending, such as using budgeting methods like zero-based budgeting or the 50/30/20 rule to allocate funds wisely. Additionally, living stingy by choosing no-name brands, buying in bulk, and cutting unnecessary subscriptions can help reduce expenses.

Is Marriage the Right Financial Move for Everyone?

Walking down the aisle and saying “I do” can bring you a bag of gold and not just a big smile in your heart. But you might still be asking, is it better to be married or single financially? The answer to this question lies in factors like when and whom you marry.

For example, if you marry right after college, you may be burdened with student loan debt, earning a modest income, and postponing major purchases like a car or a  home. In this scenario, you can reap the financial benefits of getting married young by sharing expenses and pooling resources.

However, marrying too young can sometimes lead to income disparity, where one partner earns more and has to financially support the other. This may create pressure on the higher-earning spouse to cover most expenses, which, over time, could lead to frustration or resentment if financial expectations are not openly discussed and managed.

On the other hand, older couples entering marriage are usually financially independent, reducing the need to rely on each other’s income. They may also have accumulated assets, such as real estate holdings or stock portfolios, which provide a strong safety net during economic downturns.

Whether you marry early or later, your partner’s money personality can greatly impact your finances. Are they a flyer, saver, spender, risk-taker, or security seeker? Financial conflicts often arise when opposites attract. Imagine being a saver determined to save money when building a new house while your spouse prefers lavish spending.

In the end, while love is the heart of marriage, the financial perks can’t be ignored. From tax breaks to shared expenses and retirement benefits, marriage can set the stage for long-term financial stability. By making smart money moves together, couples can build a secure future while enjoying the journey of life side by side.