Should We Skip Kids in Order to Get Rich?

Both Jay Zagorsky and Amalia Miller, whose studies we have been considering this week, are writing about families and wealth, especially for women. Putting the two studies together, we would get:

Women are richer if they delay childbirth past 30.
Men and women are richer if they stay married.
Projecting these two facts in a straight line would lead to the conclusion that the best way to end up rich is to stay married and not have kids.

Indeed, Waite and Gallagher, in The Case for Marriage, show that the biggest single material effect of marriage on women is that it makes them wealthier than they otherwise would be.

I can think of three reasons not to make a straight-line projection here, though.

First, parents, most especially men, work so hard at wealth generation because they have kids. In The Millionaire Next Door, Thomas Stanley and William Danko paint a picture of wealth generation as the work of a couple, not an individual: he plays good offense, bringing in a substantial income, and she plays good defense, limiting their spending. I read that through the Case for Marriage lens to see wealth generation as a family affair: the parents make and keep the money, because the kids need it. Remove any one of these three elements from the equation, and the family is just less likely to make and keep wealth.

Second, a couple without kids are less likely to stay married. A couple who are unable, or unwilling, to have kids together are at significant risk to divorce for that reason alone. Moreover, childless couples have a lower threshold for divorce, because there are no kids to hurt by splitting.

Third, I think few people are moved simply by a desire to make more money. Beyond a certain level of financial security, it takes a reason to make the sacrifices that devoting yourself to money-making requires. Spouse, kids, grandkids, familial posterity are reasons to make those sacrifices. Simply moving toward the right-hand tail of the income distribution is not.

So should we skip kids in order to get rich? Naw – there isn’t enough point to it.