This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Similar Credit Scores Means Fewer Divorces

NEW YORK ( TheStreet) -- Go to a dating site and you'll see a zillion lonely hearts who yearn for long walks on the beach and cuddles before a fire, and the sites' new-member questionnaires are full of queries on exercise habits, political views, feelings about children and other, well, irrelevant issues.

Because what really matters is credit scores.

At least, that's one implication of some research on what makes for a solid marriage. People who enter a marriage with similar credit scores have a much better chance of going the distance than partners with scores that are very different, according to a study by two Federal Reserve Board researchers, Jane Dokko and Geng Li.

It's long been understood that money and children are hot-button marital issues, but until now there's been no rigorous academic research on credit scores.

"Credit scores convey unique and often unobserved information about consumers, including their loan payment histories and default behavior, as well as their levels of indebtedness and tastes for debt," the researchers conclude. "In addition, credit scores arguably proxy for trustworthiness by measuring the likelihood that an individual will repay and honor a debt obligation."

The researchers looked at data on tens of millions of couples from 1999 through last year.

Though it wouldn't make for a good Jane Austen novel, in which impoverished ingenues seek rich heirs, the research shows that people, in recent years at least, tend to marry people with similar credit scores. Those who don't have a much greater chance of suffering "financial distress and household dissolution."

That doesn't mean people are asking their dates to sign credit-release forms, but it suggests that one way or another prospective spouses look for mates with similar financial habits and views.

The researchers also found that spouses who start with very different credit scores have a better chance of staying together if their scores become similar over time than if they don't.

All those other characteristics, such as political and religious views, do matter. But the research suggests that even spouses compatible on many levels face a bigger chance of trouble if they aren't financially simpatico.

Though the researchers don't get into it, it is possible for some financial disconnects to be fixed, especially if they come from bad habits rather than philosophical conflicts. A poor credit rating, for example, can be the result of sloppy bill-paying habits rather than a true lack of trustworthiness. You can make your credit score better, and that's a lot easier than making yourself taller or more exotic.

So any prospective couple would be well advised to discuss financial habits and philosophies, savings habits and so forth. And it pays to set up an easy-to-use, stress-free financial system using money-tracking programs such as Quicken and That will work even better with online bill paying and alert services that use text messages and email to tell you when bills are due and accounts are running low or nearing credit limits.

What do you do if you cling to the romantic notion that opposites attract? Before the wedding, the researches suggest, get some counseling -- the financial kind.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $110.38 0.00%
FB $92.07 0.00%
GOOG $626.91 0.00%
TSLA $247.57 0.00%
YHOO $30.71 0.00%


Chart of I:DJI
DOW 16,472.37 +200.36 1.23%
S&P 500 1,951.36 +27.54 1.43%
NASDAQ 4,707.7750 +80.6910 1.74%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs