How to navigate a relationship with lopsided incomes?

Partners who have exactly the same income or assets are a rare breed. In the majority of relationships there is always one who owns or earns more than the other. In the "old days", a couple normally formed a single economic entity. Today, each individual is normally an economic entity of their own. In a best-case scenario, both partners communicate well, and judgements and conflicts about differences in income and assets have been dealt with. The partners understand that these differences arise from different career choices, opportunities or personal circumstances, and that these differences need not affect their balance sheet as a couple. But this is not always the case. Sometimes such a large gap can arise – either between both incomes or the personal assets – that it causes tension, uncertainties and friction within the relationship:

• The partners with a lower income may sometimes feel guilty because they do not contribute as much. As a result, they may be inclined to hold back on their own desires and needs. On the other hand, the partners with the bigger income may feel guilty about their financial dominance in the relationship. For example, a person may play down the successes in their careers, such as promotions or salary increases, because they feel guilty.
• The person who earns less may be tempted to cover up personal expenses to avoid criticism of purchases that are less than essential. The higher-income partner may be embarrassed by their own expenses, and cover up purchases to avoid the other partner noticing them. This “financial strangulation” can place the trust and the whole framework of the relationship under strain.
• The person with a higher income may appropriate the "right" to make financial decisions when these are needed, because they make the greater contribution. Conversely, the lower-income partner may feel less free to make decisions. This can result in an unbalanced power dynamic.
• Buying a gift or celebrating a special occasion (such as each other’s birthday) can lead to uncomfortable situations if income levels are very different. The partner who earns more may be tempted to buy expensive gifts, while the partner with the lower income may worry that he or she will not be able to give an equally valuable gift.
• The partner who earns more may be more inclined to incur major expenses, while the partner with the lower income may place greater emphasis on saving or repaying debts. This can lead to tensions when making joint financial decisions, such as holiday plans or major ticket purchases.
• A higher-income partner may feel trapped in a well-paid (but boring) job because he or she might think “I'm the one who provides the income” (while the lower-income partner may well have real professional aspirations). The partner who earns less may feel under pressure to improve their career and income to match that of the other.

Even though you mean the best for each other: as these examples show, a discrepancy in income can trigger tensions or uncertainties within a relationship. There is no such thing as a magic wand to wave at these challenges. However, there are certain things you can do or think about that acknowledge the sensitive areas and limit any negative impact on your relationship.

1. Consider contributing the same percentage of income

For some people, it is important – regardless of the difference in income – to share the income equally to feel valued. However, if there is a significant difference in income, it may feel unfair for one of you to have to put the same amount in the joint pot. One possible solution is to agree that you both contribute an equal percentage of your net income to the joint expenses. This can help create a better sense of balance and fairness.

Agreeing on a fixed percentage is just one approach of many. Another option is for the larger fixed costs, such as rent or mortgage payments and energy bills, to be paid by the higher-income partner, while the lower-income partner is responsible for smaller fixed costs such as the telecoms contract. This is a solution that also works for couples who do not have a joint account.

2. Communication, communication, communication

Each other's shoe size, preferred wine and favourite colour: you likely know these well. When it comes to each other’s sensitive spots on money matters, this may not be quite the case. How we handle money is largely influenced by what we learned as kids at home. Understanding your own and your partner’s background will help you to better relativise your and their behaviour, uncertainties and insecurities and avoid any misunderstandings. Try to put your insecurities on the table and avoid making assumptions. If you understand the real reasons and dynamics behind each other’s uneasiness or complaints, you can make allowances for them. It is important not to do such a “major review” just once in total, but (for example) once per year. A lot can happen over time. The difference in income or assets may increase or decrease (for example, if a partner receives an inheritance or gift), the lower earner can become the major earner or vice versa.

In addition to a “major review”, it is a good idea to carry out regular “minor check-ups” and talk about money matters (e.g. every month when preparing your monthly budget). This way, you can make sure both parties remain involved and are able to flag up issues requiring more attention in good time.

3. Acknowledge and value non-financial contributions in the relationship

In a relationship, money is only one aspect of what both partners contribute. It may well be that the person with a lower income makes a significantly higher contribution in other areas than the partner with a higher salary. For example, one partner may have a job with many responsibilities and a correspondingly high income, while the other works part time to be able to keep the household running smoothly and spend more time with the children.

These non-financial contributions deserve as much appreciation and recognition as the financial contributions. It is important for both partners to keep an eye on this balance. A situation where the higher earner does not take on household tasks or rarely helps the children with their homework and the lower earner overcompensates at home because they contribute less cash can lead to friction and frustration within the relationship. Recognising and appreciating both financial and non-financial contributions helps create a more harmonious relationship of equals.

4. Make sure you have an escape hatch

What happens if our relationship ends? Even though everything is fine now, it is useful to ask this question periodically (e.g. once a year). Do you think the outcome would be fair on both of you if things broke down today? Or do you need to make some adjustments (and update your paperwork)? This can also help to alleviate any concerns or fears that arise from the difference in income or personal wealth. If you both – i.e. the lower and the higher earner – know that you are adequately protected, it may bring you even closer together.