Shannon Roddel | January 20, 2019
Plagued by a splurging spouse? Open a joint bank account.
New research from the University of Notre Dame shows that people who share money from a joint account are less likely to wastefully spend for fear of having to justify the expenses. Those partners will avoid pleasure spending in favor of utilitarian purchases, which are easier to justify.
“The Consumption Consequences of Couples Pooling Finances” is forthcoming in the Journal of Consumer Psychology, from Emily Garbinsky, assistant professor of marketing in Notre Dame’s Mendoza College of Business and Joe Gladstone of University College London.
“We found that this spending pattern was not a one-time occurrence,” Garbinsky says. “People made these decisions over and over, which resulted in thousands of dollars spent.”
Approximately 82 percent of couples in the U.S. maintain at least one joint bank account, and although they have different motivations for pooling their finances, Garbinsky says the need for justification does not appear to be a primary factor.
“Common reasons include convenience and a standard belief about how couples should manage their money,” she says. “We show that although the perceived need to justify spending is not an antecedent of the decision to pool finances, it does represent an important downstream consequence of the decision to pool, which subsequently influences purchase decisions over time.”
Read more here.