How Parents and Significant Others Impact Student Finances

On Monday, we discussed how people are sometimes dumb with money and love, but it’s not all bad news. Today, we highlight research that shows love can positively influence our finances. The first study, published in December 2015, followed 693 University of Arizona students. The (mostly white, female) students were extensively surveyed toward the beginning of college (ages 18-21) and then again toward the end (ages 21-24). The 693 study participants were all included because they reported being in a serious, committed relationship at the second survey. The study was trying to figure out the impact parents and romantic partners have on the financial behaviors and attitudes of college students.

Students were asked to indicate to what extent their parents did things such as track their monthly expenses, spend within a budget, pay credit card balances in full each month, save money monthly, etc. The students then had to rank their own attitudes towards each of the activities and then how often they had done similar financial activities (ie: save for retirement, pay bills on time, etc) themselves in the past six months. At the second survey time, students were asked to also answer the same questions they answered about their parents’ financial behaviors about their significant others.

RESULTS: During the first survey period, when college students were young, fresh out of their homes, and romantically unattached (only 2% reported being in a serious, committed relationship during the first survey), the positive financial behaviors of parents had a significant impact on the financial behaviors of the student (though not their financial attitudes). “Parents’ responsible financial behavior has a positive, direct effect on college students’ financial behavior, even when controlling for both parents’ and the student’s baseline behavior.”

During the second survey period, though there was still a correlation between positive financial behaviors of parents and positive financial behaviors of the student, the impact was no longer significant. Enter: the love interest! Here’s where I think it gets interesting. The influence moved from parents to romantic partner with financial behaviors of the partner having the same positive, direct effect on the student’s financial behavior, but the love interest was able to significantly impact the financial attitudes of the student as well. “In other words, the college students in our sample adopted the financial attitude and behavior of a romantic partner, presumably in response to observing and discussing that attitude and behavior with the romantic partner.”

Parents start the path to financial awesomeness, but who you marry ends up making a bigger impact on how you feel about finances. Choose wisely because you’re on the path together.

These influences don’t go away as the marriage progresses. A 2014 PhD Dissertation out of Purdue looked at how spousal relationship qualities contributed to retirement savings. Conclusion: “Relationship strain was found to undermine IRA ownership while spousal support was associated with higher IRA balances.”

Your relationships have a large impact on your financial behavior and attitudes. We would be wise to answer the same questions about the people with whom we spend the most time: To what extent do these people contribute to savings accounts, spend less than they earn, pay credit card balances in full each month, track expenses, or pay bills on time? What is their attitude towards those same behaviors? What is yours?


When Money and Love Don’t Mix


The Impact of Making Just One Change


  1. I always find it crazy when people get married and then find out that their spouse has a ton of debt or has no idea what their income is. HOW DOES THAT HAPPEN? My girlfriend and I are completely open about that stuff and we aren’t even married. But maybe that’s because I’m a personal finance junkie. Like all relationships, I think being open and honest is key. Money was not a taboo subject in my house growing up, even at times when there wasn’t as much going around as people would have liked. I think that was instrumental in me understanding money growing up.

    • MaggieBanks

      Right. And actually it surprises me that people were actually able to answer questions about the financial behaviors of their significant others. I feel like the norm is to ignore discussions of budgets, savings, etc. even after marriage in many cases!

  2. My husband and I have dealt with bad finances since the beginning of our relationship. In retrospect, neither of us really had many long-term plans when it came to money. We just worked to spend. Looking back even farther, we both grew up in families with parents who never really had any extravagent financial plans either. Our parents worked and they spent money – that was the behavior modeled for us. I don’t remember my parents ever discussing things like investments or retirement plans. And my father-in-law was a single dad, working long hours as a truck mechanic, in order to raise two boys.

    I’m really inspired to teach my children that there are other options. Although, according to this research, I also need them to hook up someone else with an entreprenurial spirit.

    • MaggieBanks

      I think if you model good financial behaviors and attitudes, they will be able to mimic those in their own way. They don’t necessarily need entrepreneurial parents to see that way. I think you’ve got the makings of some financially healthy children!

    • Same here, Harmony! You described our “plan” to work to spend. My parents had much the same mindset, too. I’m just thankful that G and I figured things out together fairly quickly. Ha!

      • MaggieBanks

        If no one ever teaches you that there’s a better way, that’s how EVERYONE starts their first job. Some people just remain in the mindset longer than others.

  3. Tawcan

    It’s crazy that people don’t talk about money and finance more often. It’s definitely a good idea to be on the same page when it comes to money * finance with your significant others/spouse.

  4. I remember when I got married, my older brother said make sure you have the same values. I don’t think I knew exactly what he meant by values at that point, but I am very fortunate to be married to someone that has the same values as I do including financial values. I wife worked at a bank for many years when we first got married, that helped make us both good savers.

    • MaggieBanks

      Working towards something together makes the journey a whole lot easier.

  5. Haha! When Mrs. SSC and I got together we didn’t discuss finances too much. I’m surprised she wanted to stick around even when she found out about all my debt. This was pre-marriage because when we were buying our house, (yes we bought a house together before getting married) I didn’t get put on the loan because it would have such a negative effect on the interest rate. Bwahahahaha…. I think I’d kill my daughter if she did that with some guy…

    The point is, that by the time we bought our Houston home, my credit score had gone from maybe low 600’s up to 760 or somewhere in that range. 🙂 Plus, my spending habits and relationship with money had changed significantly as well.

    Yes, your spouse can have a HUGE impact on you financially, fortunately for me, it was all positive. 🙂

    • MaggieBanks

      Excellent example Mr. SSC. And I’m so glad your wife got you on track. 🙂

  6. Hey, Maggie. Great food for thought. I’m a big proponent of marriage because securing your financial future is the ultimate team sport. When two people both agree on a goal, and then strive to achieve it, the odds of success are high. I’ve been very fortunate. Without Mrs. Groovy, there’s no way I’d be on the cusp of retirement now. But the key is getting the right partner. Get the wrong partner and you can be financially ruined.

    • MaggieBanks

      Agreed! My mom always says I married Mr. T so that he could keep me from “flipping off the earth.” – I guess it’s good to have someone to keep us all grounded. 🙂 And working towards the goal together is much more motivating!

  7. BF and I are pretty different when it comes to money. I’m a saver/investor and he’s on the spender side (though, has never had any debt). We’re definitely making strides. We’ve started communicating more about money and he’ll even be opening up his first Roth this month! I’ll be honest though, it’s hard being the first person to introduce this stuff to a significant other and just hoping that it catches on…

    • MaggieBanks

      Welcome Taylor. I’m excited to hear about your BF’s new Roth! YAY! I can imagine it’s tough being the “responsible” one, but it’s worth doing. He’ll thank you one day. 🙂

  8. Really interesting study. I didn’t really consider this when I fell in love with my bow husband 20+ years ago (we met when I was 13).
    Although I’m obviously much more interested in finances than my husband, and we value financial security because of very different upbringings: I saw the benefits of financial security but the lack of it in my husband’s childhood propelled him to create it for us and our kids. He loves taking the kids to the dentist which is covered under our private health insurance because he never went as a child.

    • MaggieBanks

      I think about that concept a lot. I think we try to overcompensate for things we miss out on in childhood. In some instances, that’s good – like the dental visits. In others, it’s not good because parents that were never able to buy nice things as kids sometimes overcompensate and buy their kids ALL the things. I think I overcompensate in planning out post-children lifestyle plans because my mom never made any post-children goals and has been struggling since my sister and I moved out (over a decade ago).

      • Yes I’m sure you are right. I do try not to spoil our kids but is it though. Interesting that your FIRE goals have been influenced by your mum. We will have much more time (and space) when the kids eventually move out. Gotta get that right balance of having your own identity and not living through your children.

  9. My parents never talked to me about their financial habits when I was growing up (nor do either of them today). I just knew that they sat down at the dining room table and “paid bills” once a month, but I didn’t know any details. I also never had even a ballpark idea of how much money they made (nor do I today: literally NO idea). Thinking back, I’m pretty sure they were trying to protect me from having to think/worry about money, but I wish they had talked to me more about it.

    And then there was the guy I dated in my late 20s who had over $50K of student debt, including lots of private loans, but was mostly ignoring this so he could buy a new car, and was applying to grad school and planning to take out even more loans to cover that. Actually one of the reasons I applied to my PhD program was because I felt like I should pursue another degree, because he was planning to. (Great reason, right?)

    I don’t want to blame anyone else for my decisions, because they have been totally my own. But it’s interesting to think about possible influences.

    • MaggieBanks

      I agree with you. Relationships can change everything. Honestly, though my dad talked a lot about money with me, I had no idea how much they made until a few years ago when I saw their tax docs. And I really was floored by how much they made because, to their credit, they taught me frugality and saving and we never had a whole bunch of flashy, showy things. Their priority for money was family vacations, which is why it’s now mine. 🙂

  10. Thankfully my wife and I have always been on the same page with money. It’s not much of a coincidence though. I remember a few times when I was single where I was talking to a girl I was interested in, but could tell she wasn’t good with money. Huge red flag for me. Got out of those situations real quick!

    • MaggieBanks

      Smart thinking. At one point I decided I should start asking potential suitors if they were independently wealthy – but then I met Mr. T and he wasn’t… alas. 🙂

  11. Very interesting research. I always thought my parents had a meaningful impact on my financial thinking (living semi-frugally and talking to me about why we didn’t always have the nicest, fanciest things). As I get older, I definitely feel the influence of others more and more — both my partner’s and my friends’ spending habits play more into mine.

    They might be making a stretch with their assumption about “…presumably in response to observing and discussing that attitude and behavior with the romantic partner.” As many of the other commenters have discussed, it’s not always so intentional, and these topics often aren’t discussed at all among couples!

    • MaggieBanks

      I completely agree! I think a lot of the influence is environment. When you spend that much time with someone and WANT to spend that much time with them, if they’re outrageous spenders, you move towards that to be with them. And money isn’t talked about nearly enough in relationships.

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