Reports on the topic of alternative relationships indicate that as marriage rates continue to decline and the cost of living rises, more and more people are adopting non-traditional family arrangements to find companionship, advance their careers, and stay put. financially afloat.
Finances can be complex in any relationship. Even if only two adults are involved. However, when you add a third, fourth, or even more partners to the mix, things can quickly become even more difficult to manage.
The presence or absence of primary partners – a relationship that takes precedence over the others – can play a role. Moreover, if there are children. Whether the partners live together or separately also affects the financial side of the relationships.
If you’re wondering about the financial implications of having multiple partners. Here is an overview of the types of relationships that exist. Here are also some of the complexities that come with it.
Bigamy vs. polygamy vs. polyamory
Many people confuse the terms ‘polygamy’, ‘bigamy’ and ‘polyamory’ and use them interchangeably. Although a polygamous relationship is polyamorous and may involve bigamy. A polyamorous relationship is not necessarily polygamous or has anything to do with bigamy.
Bigamy involves attempting to legally marry more than one person. Bigamy is illegal in the US. A person can only be legally married to one other person. Bigamy is a form of polygamy.
Polygamy is also illegal in the US. Polygamy can occur when someone enters into a relationship that is treated as a marriage. This happens while they are in a marriage-like relationship with someone else. A polygamous relationship can involve two people who are legally married. As well as a third or more people they treat as spouses even if they haven’t tried to legally marry them. This means that polygamy may or may not also involve bigamy.
Generally, polygamy was made illegal due to common law marriage statutes in several states. In a common law marriage, a relationship may have legal rights and protections similar to a de facto marriage. Even if the couple never got a marriage license or legally married. If more than two people are married, they can all be considered part of a common law marriage. This type of marriage is not legal.
Polyamory is different. It’s just a form of non-monogamy. This may not involve marriages, legal, common law or otherwise.
While in polyamory, romantic relationships can exist between more than two people. Every relationship is not necessarily treated as a marriage. For example, a woman may be legally married to one partner, while having another partner who is treated as a boyfriend or girlfriend. It is also possible that a woman is not married at all. She may choose to maintain a romantic relationship with more than one partner.
Polyamory is not illegal as long as the relationships do not transition into a polygamous or bigamous state.
The financial consequences of a polyamorous relationship
Dealing with finances while in a polyamorous relationship can be complex, but also very varied. One of the biggest factors in how things are handled is often cohabitation and whether two people are married or living as such.
Living together may mean that certain costs have to be split. For example, you may need to share some rent or mortgage payment responsibility. Likewise, utility, cable and internet costs can be managed collectively.
But even if two members are married or living as married couples, they can choose to maintain separate bank accounts to manage their income. Bringing together finances is not a requirement for marriage, and a divorce can make it easier to settle matters between the primary partners and any additional relationships they maintain.
If a couple is married and polyamorous and chooses to pool their finances, it is often wise to budget expenses for other partners. This can help set limits on how much each person can spend on their other relationships, ensuring that enough money is available to handle joint obligations.
Cohabiting couples
Alternatively, a cohabiting primary couple may choose to maintain a joint bank account for shared financial responsibilities and separate accounts for their expenses. This can function similarly to the budgeting approach for fully unified finances, but can provide some additional privacy.
In some cases, members of polyamorous relationships may choose not to live together, even if they maintain a primary relationship. In these scenarios, each individual may be solely financially responsible for their home, bills and finances. This means that joint budgeting is not necessary and everyone can spend what they want, based on their needs and preferences.
There’s also nothing that says each member of a larger polyamorous relationship couldn’t live together. However, this can make it difficult to maintain a legal separation between polyamory and polygamy, especially in states where common law marriages exist.
This often means that strict financial limits must be applied. For example, if you share a bank account between more than two members of the relationship, or have multiple accounts for two people with different partners, the legal boundaries can become blurred. Additional, estate planning can be complex if you want to leave something to non-primary partners.
Understand state laws
Ideally, anyone in or considering a polyamorous relationship should review their state’s laws regarding common law marriage and polygamy. That way, everyone can understand what actions can enter the polygamous arena, allowing all members to avoid legal penalties for the relationships.
It may also be wise to consult an attorney when it comes to estate planning or large joint financial purchases, such as a home. They may be able to give you advice to ensure that legal limits are not accidentally exceeded.
The financial consequences of a polygamous relationship
A polygamous relationship can come with all the financial challenges of a polyamorous relationship, and more. First, since polygamy is illegal, there are potential legal costs associated with the existence of the relationship. For example, attorney and court fees may be expenses that need to be managed. And in general, breaking the law is a very bad idea.
Furthermore, in polygamy, more than one relationship is treated as a marriage. This could mean that multiple partners all live together and share household management responsibilities, or that some parties are full members of multiple households.
Setting multiple budgets may be necessary to manage a polygamous relationship. This is regardless of how many people earn an income. If there is more than one physical home. Anyone who lives in multiple households may need to divide their income. Everyone has to do their part, which can complicate the financial aspects of relationships.
If everyone lives together, one budget may be sufficient. However, spending limits on non-household expenses are necessary to keep everyone on track financially.
The complexity of estate planning
Estate planning will also be complex if everyone lives together in a home that at least one party owns. Especially since more than one relationship is considered a marriage. This is one of the reasons why polygamy is illegal, because the legal complexities are difficult to understand. However, an estate plan solves certain problems. But if one party chooses to fight the plan when a family member dies, it can be difficult to reach a solution.
To learn more about the complexities of estate planning in polyamorous relationships, read “Estate Planning for Polyamorous Families,” from the Journal of the National Association of Estate Planners & Council, Issue 452024.
Polygamy and polyamory are legally difficult and it is probably best to avoid crossing the legal line
Ultimately, polygamous and polyamorous relationships have financial consequences. By communicating and planning openly, it is possible to arrive at feasible solutions. These are solutions that work for a person’s lifestyle. However, if the relationship is legally polygamous; there are countless obstacles along the way. It is wise to avoid entering that area.
Do you have anything to add to the above information? Share your thoughts in the comments below.
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Tamila McDonald is a United States Army veteran with 20 years of service, including five years as a military financial advisor. After retiring from the military, she worked for eight years as an AFCPE-certified personal financial advisor to wounded warriors and their families. She now writes about personal finance and benefit programs for numerous financial websites.
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