From Luca Stagnitti and Gerd Kommer
This blog post was updated in May 2026
It should come as no surprise to anyone that getting married can be financially lucrative. By lucrative, however, we don’t mean “marrying rich,” the oldest of all wealth-increasing methods for people who want to advance financially. [1] Rather, we mean the considerable economic advantages of marriage on the aggregate level of the couple.
Singles and unmarried couples have every reason to be jealous of these financial benefits of marriage.
Below we list the eight most important of these material advantages. The first three also benefit unmarried couples, but the next five require marriage. (Note: When we talk about “spouses” in this article, this also applies to partners in a “registered civil partnership”. In Germany, it has the same legal and tax status as marriage.)
We then look at the sometimes even greater economic downside of divorce. At the end of the article we give advice on how to reduce this economic risk. We'll start with the financial benefits of getting married.
Financial advantage partnership No. 1: Shared household management
If two people merge their households, they will have between 20% and 50% lower living costs per person compared to running two separate households for a given standard of living. Conversely, the two people will experience a substantial increase in their standard of living if they spend as much together living together as they did separately.
Financial advantage partnership No.2: Division of labor and specialization
Statistically, the economic upside of a marriage from exploiting the age-old market economy principle of division of labor and specialization can often be even greater than the economic advantage from joint household management: “One takes care of the children and the household, the other has a career”. It goes without saying that nowadays the former does not - as was historically the case - almost always have to be a woman and the latter almost always have to be a man.
Financial advantage partnership No. 3: Reducing risk in income through diversification
Every entrepreneur knows that, all other things being equal, two streams of income are better than just one. From a risk perspective, a company with just one customer or just one product is a precarious because it is poorly diversified. Likewise, Siemens is a safer investment than Meierchen Anlagenbau GmbH from Kleinkleckersdorf with two million euros in annual sales because Siemens has thousands of income streams, compared to just a handful at Meierchen. It's the same in marriage. There are twice as many human capital holders in a marriage as in a single-person household. Therefore, from a statistical perspective, marriage significantly reduces the cash flow risk of the two people involved. This also applies if both partners are not working in a certain phase - to reduce the risk, it is enough that both partners can potentially generate income.
Financial advantage partnership No. 4: Lower income taxes
If a newly married couple has their income tax assessed jointly instead of separately as before, this occurs in Germany Spousal splitting. The average tax rate for the pooled income can then be lower than the average rate for separate tax assessments. The following applies: the greater the difference in income between the two spouses and the higher the relevant tax rate, the greater the potential financial advantage. In the spring of 2026, however, political discussions began to abolish spousal splitting due to the associated tax losses and other reasons.
Another (small) income tax advantage of marriage relates to the annual savings allowance that applies to income from capital assets (“liquid assets”). This tax allowance is 1,000 euros per individual or 2,000 euros for couples. The possibility of freely dividing the tax allowance (in the case of joint tax assessment) can potentially generate higher tax savings if one of the two partners would otherwise not have been able to use the full tax allowance in a given year.
Financial advantage partnership No. 5: Lower gift and inheritance taxes
When it comes to German inheritance and gift tax, spouses are given an extraordinary economic advantage compared to unmarried partners - through higher tax allowances (every ten years 500,000 euros between spouses versus a paltry 20,000 euros between non-spouses) and through significantly lower tax rates for gifts or estates above these allowances. In addition - this view is politically incorrect and unromantic - anyone who gets married acquires a second set of parents (the in-laws), which increases the statistically expected volume of their inheritance.
Financial advantage partnership No. 6: Advantages of statutory pension insurance
With statutory pension insurance and civil servants' pensions, the surviving partner receives up to 60% of the deceased spouse's pension after the death of the spouse - the "survivor's pension".
Financial advantage partnership No. 7: Lower costs in statutory health insurance
In statutory health insurance, a non-working spouse can be insured free of charge (this advantage does not exist with private insurance). However, there are political discussions about abolishing this advantage due to the serious financial problems of the GKV.
Financial advantage partnership No. 8: Lower costs with other insurance policies
A number of insurance policies can be cheaper for married people than the sum of the contributions to otherwise identical, separate insurance policies, e.g. B. Legal protection, accident, private liability and household contents insurance.
Financial Benefit Partnership #9: Higher credit score for a home loan
Many people only get into a financial position as a married couple to meet a bank's creditworthiness criteria for taking out a loan for a property they use themselves (home: apartment, house). As singles, they would not receive a loan, not even a smaller one, because it would give them a lower credit rating. This has to do with several factors that we described above, including the fact that two people actually or potentially making money is lower risk than just one person from a lender's perspective.
The financial downside of a divorce
Now that we have seen how amazingly diverse and great the financial upside of living together and marriage can be, we now come to the other side of the coin - the economic downside of a divorce and that is just as serious in the other direction. Because over a third of all marriages in German-speaking countries end in divorce, this is an aspect that affects many people.
To avoid misunderstandings: The fact that the partner who was wealthier before the marriage or the partner who earned more during the marriage subjectively suffers an economic loss in the context of a divorce in favor of the partner who is less wealthy or earns less is trivial - but that is not the point here. This is about the financial disadvantages of a divorce aggregate level of the pair, i.e. at the level of the assets to be distributed in the divorce.
First of all, we would like to dispel the idea, which is sometimes encountered in this context among young people who are inexperienced in marriage, that in the event of a divorce, the previously pooled assets of the married couple are now simply divided approximately equally between the two ex-partners (or in a different ratio if a prenuptial agreement contains different provisions).
The reality is different. Divorces – at least not completely amicable divorces – are “asset destruction events.” The financial journalist Volker Looman puts it this way: “The financial consequences of a divorce are in many cases worse than plague and cholera” (FAZ.net, October 1, 2019). US economist Laurence Kotlikoff makes a similar statement: “Divorce is one of the most destructive financial forces on the planet.” [2] The American asset manager Rick Kahler writes about divorce: "There is no greater threat to your financial well-being than divorce. Unless you are very wealthy or extremely poor, both former spouses will see a decline in their lifestyle." [3]
Here are five important reasons behind these drastic assessments:
Reason 1: Loss of benefit from shared household management
For the individual, now divorced partner, the loss of this marital advantage due to the divorce will probably feel like all the costs of their usual lifestyle skyrocketing overnight - between 30% and 70%, depending on the individual case. (Due to the unpleasant laws of arithmetic, the percentage - although not absolute - increase in costs in the transition from marriage to singleness is higher than the previous percentage decrease in costs in the transition from singleness to marriage.)
This cost inflation can be illustrated using the example of shared property: assuming the same quality of living space, value and location, two separate dwellings are twice as expensive as just one. If one of the partners does not have the financial means to cover the additional housing costs resulting from the separation, the standard of living will fall because this partner now has to live in cheaper, worse quality property. Sometimes the move to a worse property even affects both divorced spouses.
Reason 2: Elimination of income tax advantages
Without spousal splitting (see above), the former couple's combined income tax burden increases. The disadvantage affects the better-earning ex-spouse disproportionately more, while the lower-earning partner suffers a smaller disadvantage.
Reason 3: Opportunity costs in the professional/entrepreneurial area
Divorces typically drag on for more than a year, simply because of the legally required separation year in this country. One can assume that during a non-amicable divorce phase of one to three years, top professional achievements and career advancements occur less frequently than during the rest of life. This often has economically disadvantageous consequences, which, however, cannot be quantified in a generally valid way. One of the two authors knows a wealthy tax consultant who, according to his own statements, lost or did not earn around two hundred thousand euros in fee income from his law firm because he was unable to properly look after his company for two years during the divorce.
Divorce-related liquidity outflows can cause significant economic damage to small and medium-sized companies.
Reason 4: Costs for lawyers and experts
In the event of a non-amicable divorce that drags on over a long period of time, lawyers and consultants can incur costs of many thousands of euros, for example if there is a disagreement about the value of real estate or company shares or about the amount of maintenance payments. The most economically attractive situation for divorce lawyers is for both spouses to hire lawyers who pursue an aggressive, destructive strategy of maximum demands. With spouses extremely emotional in this phase, the respective lawyers can often implement this kamikaze approach, which is profitable for them, with surprising ease. In a wealthy couple, it is not uncommon for the two partners to spend five-figure sums on their divorce consultants. These costs are borne by the joint assets that must be distributed after the divorce.
Reason 5: Risk of loan financing
Any existing loan financing can go into a tailspin after the divorce due to deterioration in liquidity, income and creditworthiness. If, in an unfavorable case, there is a foreclosure auction of the previously shared home or a rented property, the result is up to 40% less than the otherwise achievable value of the property, as the bank simply wants to see the loan or most of it repaid quickly - in addition to the frequent emotional deterioration.
Maintenance payments or one-off compensation payments from partner A to partner B do not cause any additional expenses at the aggregate level of the couple - from the perspective of the former couple it is a left-pocket-right-pocket effect - but in isolation from the perspective of the person who has to make the payments, they represent an economic deterioration.
Reduce the economic downside of a divorce
Given these sobering facts, the question arises as to how the economic risks of a separation or divorce can be reduced.
Naturally, there is no patent recipe for this. Nevertheless, there are a number of starting points that can make big financial differences here. Most of these approaches work better, or only work at all, if you use them before the marriage takes up.
(a) The conclusion of a marriage contract
Anyone who does not have a marriage contract lives under family law in the statutory property regime, the so-called accrued community. In the event of a divorce, the rules for dividing assets often do not lead to the result that both spouses originally wanted. With a marriage contract, you can deviate from the principle of community of gains to a limited or very large extent according to your own wishes.
In general, a prenuptial agreement can contribute to the peace of mind of both partners during the marriage and significantly reduce the potential for conflict in the context of a divorce. In this way, the divorce can be processed faster, with less emotional pain and with lower legal and expert fees.
In addition, the negotiation of a prenuptial agreement before the start of the marriage is - we choose this adjective carefully - an excellent soul-searching as to whether the two marriage candidates actually think similarly enough about the economic aspects of their “merger project”. A couple who cannot agree on mutually agreed terms in a marriage contract in advance, when love is still blossoming, must ask themselves whether they should undertake the marriage project together at all. (Think of the oft-quoted verse from the poem The Song of the Bell by Friedrich Schiller, 1759 - 1805: "So check whoever commits himself forever to see whether his heart finds its way to the heart. The madness is short, the remorse is long.")
It should be noted that marriage contracts that are too one-sided can potentially be legally challenged by the partner who feels disadvantaged in the divorce. You can write whatever you want into a marriage contract, but whether “extreme” or, from a court’s perspective, even “immoral” regulations will stand before the Kadi is a different question - advice from a joint lawyer or two separate lawyers is advisable in any case. In addition, the law requires a marriage contract to be notarized.
There are many countries in which marriage contracts are not recognized or are only recognized to a limited extent, for example Great Britain. Therefore, anyone who is considering emigrating or has already done so should have this aspect examined legally.
For the sake of completeness, it should be mentioned that the conclusion of a marriage contract after a marriage has already taken place is rare for obvious reasons.
(b) Encourage the employment of the lower-earning partner during the marriage
In many marriages with children, one partner - traditionally, unfortunately, almost always the woman - gives up working while the child or children are small. Due to a case-specific mix of backwardness, comfort or other factors on the part of both or just one of the spouses, the woman often stops working after the youngest child has started school. This historically common marriage model can take revenge if a divorce occurs. After years or decades of absence from the labor market, the woman finds it difficult to find satisfactory and sufficiently financially attractive employment and - rightly or wrongly - bitterly mourns her “sacrificed career”. The man has to pay even more maintenance.
(c) De-emotionalize the divorce
Of course, this is easier said than done. But anyone who sees the divorce as a campaign of revenge and punishment on the other person for the suffering previously inflicted during the marriage will most likely destroy part of the assets to be distributed via the above-mentioned methods and thereby harm themselves. A quickly reached, out-of-court settlement is usually financially wiser for both parties and can even help to alleviate the intensity of the psychological trauma that often accompanies a divorce.
(d) Separate, but waive the divorce (temporarily).
As is well known, married couples can separate without divorce. Those who take this route usually do so for economic reasons that are too diverse and case-specific to be summarized in this article. We will only mention a single aspect: A married couple who have already lived apart for ten years, including the long-finished construction of a new post-marital life, will find it easier to get a “delayed” divorce – if it is even necessary – and will carry it out more rationally and in a way that protects their assets.
(e) Marry again
At the beginning we described the huge financial advantages of a marriage or registered civil partnership. Someone who gets divorced loses these benefits, but can regain them by remarrying. However, we must immediately add water to the wine: the statistical probability of getting divorced increases with every subsequent marriage.
(f) Establish a family foundation
An entrepreneurial couple or possibly a single partner who sets up a family foundation in Germany or Liechtenstein well before the divorce and transfers assets to this foundation can significantly reduce the potential for asset destruction in a potential later divorce case. In general, it can be said that a foundation does everything that a marriage contract or a will can do, only better in many ways. We have one on the subject of family foundations and other asset protection measures own book written
Conclusion
Getting married can bring great financial benefits; Divorcing creates even greater financial disadvantages. Anyone who wants to experience the adventure of marriage is well advised not only to dream ex ante about the family and lifestyle implications of this big romantic project, but also to think intensively about the economic opportunities and risks of marriage. Both spouses can do a lot before marriage and, in some cases, afterwards, to minimize the economic suffering of the divorce later on. From a legal perspective, concluding a marriage contract is often a good instrument for reducing possible downsides.
Endnotes
[1] The subject of “social advancement through marrying rich” has been used endlessly in world literature – both sophisticated and non-sophisticated – since the Middle Ages, because marrying rich was a universal goal in the bourgeoisie and nobility for centuries. A beautiful example of literature from the 19th century is the novel Washington Square by Henry James 1843 – 1916.
[2] “Divorce is one of the most destructive financial forces on the planet.” Laurence Kotlikoff, “Money Magic: An Economist’s Secrets to More Money, Less Risk, and a Better Life”; Hachette Book Group; January 2022; 309 pages, p. 172.
[3] "There is no greater threat to your financial well-being than divorce. Unless both spouses are very wealthy or very poor, they will experience a decline in their standard of living." Source: advisorperspectives.com, February 16, 2022