The equal sharing of financial resources and, hence, material well-being has become an assumed norm of contemporary heterosexual families. Of course, this is not to say that hetero sexual couples actually enjoy financial equality or that they share a similar standard of living. In fact, as Pahl (1989) pointed out over 15 years ago, the failure to open up the black box of familial economies to sociological scrutiny has operated to disguise intrafamilial inequalities: amongst married couples these inequalities, as numerous studies have consistently demonstrated, possess a strongly gendered character. It is women and children who tend to be poor even when the households to which they belong are in receipt of adequate incomes.
Sociologists, in taking heed of Pahl’s call to investigate the money management practices of families, have paid attention to a number of different dimensions of domestic economies. Firstly, they have sought to discover the practices through which families combine, distribute, spend, and save their financial resources. Secondly, they have examined the effects of these practices on different family members in both financial and social terms. Thirdly, they have pointed out that variations in the use of particular financial systems are associated with differences of class, ethnicity, and family structure. Fourthly, they have recently begun to consider the role remittances play in the choice of money management systems within ethnic minority families.
In pursuing this line of inquiry, largely with respect to married and, to a lesser extent, remarried and unmarried heterosexual couples and families, sociologists have consolidated and refined Pahl’s original insight into the gendered inequalities produced through contemporary money management practices. Disparities in personal spending money are a particularly sensitive marker of the ways in which different financial systems operate to reduce or enlarge gendered inequalities. Other widely recognized sites of gendered disparity within the economies of heterosexual families include: differences in the power of each partner to influence decision making, especially over extraordinary expenditure; differences in who is accountable to whom for how they manage their financial affairs; and differences in the value attributed to each person’s monetary contributions to the house hold. As Pahl (2000) aptly points out, these inequalities may well be aggravated by the emergence and increased usage of electronic banking practices that enable ”credit rich” individuals to pursue their own financial goals without consulting other family members.
Four money management systems are now widely recognized to reflect the ways in which heterosexual couples and families organize their finances; the little we know about the money management practices of same sex couples and families suggests that two of these financial systems – the pooling and independent systems -are also in use within these households. The other two money management systems discussed below – the whole wage system and the housekeeping system – are clearly connected to a traditional gendered division of labor that allocates responsibilities for paid work to a male breadwinner and for unpaid domestic work to a female housewife and mother. Because a traditional gender division of labor, and the ideologies that have given it legitimacy, is in decline, both the whole wage and housekeeping systems are also decreasing in popularity. Furthermore, their strong connection to the practices of heterogender means that these systems are rarely, if ever, used by same sex couples.
The whole wage system consists of two variations. In the more common female whole wage system (in use by approximately 25 per cent of households in the UK), men retain a portion of their earnings for their own personal use before passing over the remainder to their female partners who, after adding in their own earnings if any, are charged with the responsibility of meeting the household’s expenses. In effect, the female whole wage system enshrines earner entitlement by guaranteeing men’s access to personal spending money, while making women’s access to personal spending money contingent upon the presence of a monetary surplus. Given the preponderance of the use of this system in low wage households, combined with a now well recognized tendency for women to prioritize expenditure that meets the needs of their children, the typical outcome of the female whole wage system is large differences in the personal spending capacities of men and women. In the second variant, the male whole wage system (used by approximately 10 percent of households in the UK), men retain and manage the income they bring into the household. Under this system, men are positioned as financial gatekeepers and women as supplicants who, to the extent that they have no or limited incomes of their own, must ask their male partners for access to money in order to make autonomous purchases. Thus, women’s capacity to influence financial decisions or engage in personal spending is even more highly constrained than within the female whole wage system.
In the housekeeping system (also used by approximately 10 percent of heterosexual families within the UK), men pass over a set amount of money at fixed intervals to their partners, whilst “husbanding” the remainder of their income in a separate account to cover both their personal spending needs and extraordinary household expenses. Typically, the housekeeping allowance is used to cover day to day household expenses and in many cases it is also expected to provide women with their personal spending money. Once again this system limits women’s access to the combined financial resources of the household, their ability to influence major spending decisions, and their capacity to spend on themselves.
Unsurprisingly, given the emphasis on equal sharing within contemporary marital discourse and the growth in women’s financial contributions to households through their increased labor market participation, pooling has become the most common system in use amongst heterosexual couples (with around 50 percent of heterosexual households using it in the UK and upwards of 65 percent of couples in the US). Although research on the money management practices of nontraditional couples and families, especially same sex families, is sparse, it appears that pooling also enjoys reasonable uptake amongst cohabitating heterosexual and homosexual couples (Blumstein & Schwartz 1983; Elizabeth 2001; Vogler 2005). Arguably, the use of pooling by these couples reflects their level of commitment to each other and hence their beliefs in the longevity of their relationships. However, the choice to use the pooling system may simply be a practical response to a partner’s loss of income through childbearing, unemployment, or full time study.
In the pooling system, all (or nearly all) of the couple’s income is placed in a joint bank account, permitting each partner to enjoy direct and, in principle, equal access to their combined financial resources. Despite the rhetoric that surrounds pooling, widespread inequalities in access to the family’s joint income persist. These disparities are clearly evident in differences in the personal spending practices of major and minor (or non-) earners. To a considerable extent, the discrepancy in personal spending money amongst pooling couples (both heterosexual and homosexual) reflects the difficulty many couples experience in completely setting aside ideas about “your” or “my” money in favor of “our” money, particularly with respect to discretionary expenditure. In other words, despite adhering to the principle of equal sharing, many pooling couples continue to hold onto a vestigial belief in the rights of income earners to determine how this money is allocated. The effects of an ongoing belief in earner entitlement amongst couples who pool are several. Firstly, it boosts the decision making power of the major earner even as it diminishes the influence of the minor (or non-) earner. Secondly, it undercuts the capacity of lower or non-earning partners to spend on personal items: this occurs as much, if not more, through self-imposed restrictions as it does through restrictions imposed by the major earning partner.
Amongst heterosexual couples who pool, these inequalities of money and power are rein forced by the performance of heterogender in a context of ongoing gender related income differentials and the continued gendered division of labor within many heterosexual families. Paradoxically, even in couples where the woman is the main earner, her superior income often fails to translate into greater decision making power or higher levels of personal spending money. Rather, women in this situation tend to divest themselves of this form of power in an attempt to minimize the discomfort that arises for many men when they find themselves in positions of dependency. This raises the question: to what extent are the well-known inequalities in the domestic economy ameliorated in families that are formed around non-heterosexual couples? Available research suggests an affirmative reply: both lesbian and gay couples report achieving high levels of egalitarianism in their relationships, a finding that is partly a result of maintaining high levels of workforce involvement, and hence financial independence.
Finally, the independent system is reliant upon each partner being in receipt of his or her own income: for this reason, the use of this system is associated with higher income, often childless, households. Its uptake is also connected to newer forms of family life: in the small number of studies on the financial practices of remarried and cohabiting (heterosexual and homosexual) couples, findings point to their higher rates of usage of this system: around 50 percent of these couples appear to use an independent system compared with less than 10 percent of the married population. However, the findings of several recent studies suggest that, although subject to geographical variability, the use of an independent system amongst married couples may well be on the rise: in Heimdal and Houseknecht’s (2003) study, just under 20 percent of married couples from the US organized their money separately. Interestingly, the independent system is also in higher use in New Zealand, especially amongst Pacifica families where its use may facilitate the payment of remittances to extended family members (Fleming 1997).
In the independent system, each partner holds his or her earnings separately whilst making an agreed upon contribution to nominated joint expenses. Typically, this contribution is defined in terms of a 50:50 split of their joint household expenses; amongst some couples this contribution is placed in a joint purse (or kitty) or bank account to avoid the complicated accounting processes that are often a feature of this system. Having made the appropriate contribution, the remainder of a person’s income is defined as an individually owned and controlled resource. In other words, couples using an independent system place emphasis on the equality of their financial contributions to the family and, in exchange for making equal contributions, each partner enjoys equal control over his or her disposable income.
The attractions for women of this system are clear: the need to ask and seek approval for money to cover personal purchases, a key hall mark of financial dependency, is circumvented. Indeed, where women earn more than their male partners, the independent system, in affirming the principle of earner entitlement, makes it possible for women to wield more influence over spending decisions – both ordinary and extra ordinary – than is often the case amongst heterosexual couples. But how frequently women are in receipt of an income that would enable them to exercise greater power, and secondly, how often they actually take advantage of this capacity, is a matter for further research. Early indications amongst lesbian couples who use this system, however, suggest that they avoid income differentials and downplay the significance of such differences in an attempt to maintain egalitarian relationships; amongst heterosexual couples the chances that women will earn more than their male partners, although on the rise, remains low. On the contrary, disparities in income levels tend to be skewed in men’s favor. In this more common scenario, the failure of the independent system to address equality of access issues, at the same time as it entrenches earner control, may well disadvantage heterosexual women. Where incomes are disparate the principle of equal contributions will result in one partner paying a much higher proportion of his or her income toward the couple’s joint expenses, thereby leaving that person with comparatively lower levels of spending power.
The independent and pooling systems each represent promising possibilities for the achievement of financial equality within contemporary heterosexual families. Yet attempts to eliminate inequalities between family members through the use of these systems have proved to be flawed, at least under some circumstances. The continued emergence of financial disparities within families can be largely attributed to the ongoing salience of earner entitlements in con texts of income inequalities. As argued herein, both earner entitlements and income disparities are strongly inflected by the structures and norms associated with the operation of gender within heterosexual relationships. To understand more about the effects of earner entitlements and income disparities, it is time that sociologists turned their attention to the financial practices of same sex couples and families. It is entirely conceivable that through such research new ways of resolving the tensions between equality and autonomy will be brought to light.
- Blumstein, P. & Schwartz, P. (1983) American Couples. William Morrow, New York.
- Burgoyne, C. (2004) Heart-Strings and Purse-Strings: Money in Heterosexual Marriage. Femin ism and Psychology 14: 165-72.
- Elizabeth, V. (2001) Managing Money, Managing Coupledom: A Critical Examination of Cohabitants’ Money Management Practices. Sociological Review 49: 389-411.
- Fleming, R. (1997) The Common Purse. Auckland University Press and Bridget Williams Books, Auckland.
- Heimdal, K. & Houseknecht, S. (2003) Cohabiting and Married Couples’ Income Organization: Approaches in Sweden and the United States. Journal of Marriage and the Family 65: 525-38.
- Pahl, J. (1989) Money and Marriage. Macmillan, London.
- Pahl, J. (2000) Couples and their Money: Patterns of Accounting and Accountability in the Domestic Economy. Accounting, Auditing, and Accountability Journal 13: 502-17.
- Vogler, C. (2005) Cohabiting Couples: Rethinking Money in the Household at the Beginning of the Twenty-First Century. Sociological Review 53: 1-29.