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What are “Mixed Marriages”?
Quick
definition of a "mixed marriage" (my term): a couple in which one or
both is a wage earner and one or both is self-employed
or a business owner.
There are two trends that I’m watching because they affect a growing
percentage
of my clients:
Trend #1:
Dual-earner couples
For a lot of
couples, either it is necessary for both husband and wife to be
employed, or both enjoy their careers, so husband and wife continue
to be employed.
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In the last
two decades, a sharp rise in the share of married couples with
two earners has taken place, accompanied by increasing
equality of the earnings of husbands and wives, particularly
among couples with higher incomes. Those changes, occurring
for couples with and without children, have contributed to a
rise in the share of couples incurring marriage penalties.
Between 1969
and 1995, the proportion of working-age married couples with
two workers grew from 48 percent to 72 percent. By itself,
that shift tended to increase marriage penalties and reduce
bonuses.
The shift
toward two-earner couples has been accompanied by increasing
equality of the incomes of husbands and wives. Between 1969
and 1995, the fraction of working-age couples in which both
husband and wife earned at least one-third of the couple's
income doubled from 17 percent to 34 percent. The greater
equality of spouses' earnings increased both the share of
couples incurring marriage penalties and the size of those
penalties.
Source: Congressional Budget Office |
Whatever the case,
when there are two wage earners in a household, it is easy to work
with their withholding to ensure that the taxes that will be owed
are paid prorata throughout the year to avoid penalties and
interest.
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Trend #2: Growth
of Self-Employment
The US is in the midst
of quite a boom in
self-employment. |
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2004 data show that 19.5
million Americans are self-employed, and both their numbers
and the rate of self-employment are growing. Between 2003 and
2004, the number of self-employed grew by 1 million (about
4.7%).
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Combining These
Two Trends
As I’ve been
watching, I’ve noticed that these two trends are starting to merge.
I’m amazed at how many of my clients are couples where one person is
employed and the other is self-employed. I even have clients who are
couples where both are employed and one or both also own a business.
Hence the term:
Mixed Marriages.
I’ll call them MMs
for short. (The speed of my fingers on the 10-Key is legendary, but
typing is something else altogether.)
Why are
MMs so interesting to me?
MMs
F.A.Q.s - Frequently Asked Questions
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