Contract Partner - a Design Solution to the Marriage Gap

In the course, Design Justice instructed by Marc Dones from Future Laboratories, my team members, Gustav Gyrhauge and Kevin Cook, and I focused on a fascinating social situation—marriage gap.

I will present our work and design in the form of a memo.


 

Facts

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MEMO

 

To: American Politicians
From: Gustav Ole Dyrhauge, Kevin Cook & Yangying Ye

Date: 10th December 2018
Topic: The Marriage Gap in The United States of America

Abstract:

The goal of this memo is narrowing down the Marriage Gap in the United States. This memo will address how and why married couples are more privileged than unmarried people in the United States by presenting the reader with the issue at hand, illustrating concrete examples of financial benefits to getting married and lastly suggest a new form of contract that will allow unmarried people living together to accomplish similar benefits as married couples.

Background:

There is no doubt that marriage has financial benefits to the individual and to the married couple*. The benefits reach from taxes to insurance policies and make great incentives for getting married. However, many poorer and less educated Americans are opting not to get married at all. They’re living together, and often raising kids together, but deciding not to tie the knot. Marriage is becoming a more durable, but far more exclusive institution. The marriage gap describes observed economic, political and educational disparities in the United States between those who are married and those who are not. In today’s economy, a person with a Bachelor’s degree will receive, on average, 66% higher lifetime earnings than persons with a high school diploma or less. The average married couple reports to have an average net worth of around $43,000 after 10 years of being married, compared to $11,000 for people who stayed single. Together, the benefits of marriage and the lifetime earnings of having a higher education are escalating income disparity in America.


Purpose:

We suggest a legal “Contract Relationship”. This is a contract that people – no matter sexuality or relationship constellation – can engage in after having lived together for three years or having lived together for one year with a child. The contract would provide the beneficiaries with the same legal and economic benefits as married couples currently have. The people involved in the relationship would be offered to engage in a contract by the US Government. For the contract to be valid, at least one person would have to agree to the contract in order for it to be initiated. The contract runs for a minimum of three years with options to timeout or renew.


Conclusion: — What this proposal will accomplish for social good?

By implementing the solution suggested above the American society should obtain a narrowing of the marriage gap across socioeconomic classes to ultimately reduce income disparity.

Appendix

Benefits of Being Married

IRA (Individual Retirement Account)

If a woman earning $80,000 retire at 66, they will receive $496,080 over the next twenty years. If they can hold out on retiring for another four years, they will get $528,960 over the next 16 years. However, married women earning $80,000 can defer retirement between ages 66 and 70 and earn an extra $55,896 in addition to their own income, simply by also collecting their husband's Social Security.

Income Tax

In 2010, single women earning $40,000 paid $6,181. Their married peer paid more than a thousand dollars less: $5,162.

Single women earning $40,000 per year paid $245,000 in income taxes. Married women earning $40,000 paid $206,000 in income taxes — a difference of $39,000.

Single women earning $80,000 per year paid $645,000 in income taxes. Married woman earning $80,000 paid $490,000 in income taxes — a difference of $155,000.

Health Spending

Single women with an income of $40,000 spend $189,600 on health over 60 years; whereas married women with the same income spend $165,600 — a difference of $24,000.

Married women with an income of $80,000 spend $331,200 on health over 60 years, and unmarried women with the same income spend $379,200 — a difference of $48,000.

Car Insurance
Two people in their 30’s who combine their car insurance policies after marriage can save an average of $525 per year on a merged policy. The savings vary by state and insurer. A Texas couple in this example would save an average of $780 with Geico but just $360 with State Farm.

Tax Benefits

A groom with no deductions and a taxable income of $65,000 would owe $9,389 in 2017 taxes, while his groom making $40,000 would owe $3,974. Filing as a joint couple with a taxable income of $105,000, however, they’d owe $12,528, a savings of $835.

Prenuptial Agreement Benefits

“It's presumed under the law that when two people get married, they're creating an economic partnership, Aronson, Mayefsky & Sloan LLP matrimonial lawyer Alyssa A. Rower says. "If one person spends a substantial amount of time on career and [the] other spends it on raising children, we will compensate the non-monied spouse in a prenuptial agreement by dividing assets fairly between the spouses should the marriage end.”


A Design Solution to the Marriage Gap

 
 
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Prototype

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Collaboration with the insurance company

Collaboration with the insurance company