This startup bets up to $10,000 that your marriage will end badly

Danielle Paquette
December 16 at 12:44 PM - The Washington Post

A new startup in Seattle will fund your wedding. Up to $10,000. Even the nacho cheese fondue fountain. The catch: If your union crumbles, at six months or 25 years, you must pay them back — with interest.

Swan Luv will review your relationship and set an interest rate based on your compatibility. Co-founder Scott Avy won’t reveal the couple-selection criteria or the interest range. He said simply that the number “won’t be too crazy.”

But Swan Luv, he said, won’t directly profit from heartbreak. Cash from divorces — and there will be divorces — will cover someone else’s future nuptials. Avy said he plans to sell advertisements to generate revenue, although he wouldn't say what kind or to whom.

Swan Luv’s sustained growth, as the business model apparently stands now, depends on a whole lot of lovers breaking up.

The idea came to Avy when a recently engaged roommate complained about wedding costs. He thought: Why should money stand in the way of love? “Swans, they mate for life,” said Avy, a product manager at Expedia by day. “That’s what we’re trying to get behind, everlasting marriage.”

People, however, don’t always mate for life. People also have mortgages, child support, divorce attorney fees — does Swan Luv really want to slap them with a failed marriage bill?

“We’re not forcing anyone to sign up,” Avy said. “The feedback has been overwhelmingly positive. I’ve gotten hundreds of emails telling me how meaningful this is.”

He wouldn’t say whether Swan Luv has attracted investors, or how many couples will receive a check once the company officially launches in February. The contracts, he added, include a clause that charges only one partner if abuse ends a marriage.

Swan Luv’s offer comes as the cost of walking down the aisle surges. A survey of 16,000 brides by XO Group, which owns TheKnot.com, found that the average cost of a wedding (sans honeymoon) was $31,213.

The share of never-married adults in the United States, meanwhile, has reached a historic peak, according to the Pew Research Center. One in five adults today older than 25 have never been married, compared with one in 10 during the 1960s.

Economists say millennials are more likely than previous generations to put off marriage, thanks, in part, to student loan debt. More than a quarter of the respondents in the Pew survey of never-married adults said they’re not financially prepared for the milestone.

Over the past 30 years, both marriage and divorce rates have steadily declined. Researchers have long sought to understand what makes some marriages last while others implode. Evidence suggests age, location, education, financial health and previous partnerships may influence a relationship’s strength.

Perhaps the strongest indicator of everlasting love is your number of ex-spouses. The likelihood of divorces surges with each marriage, according to Census Bureau statistics. Roughly 40 percent of first marriages in the United States end in divorce, while nearly two-thirds of second marriages and three-quarters of third marriages dissolve.

When you move in together may also play a role. Couples who share a home, unmarried or married, before the age of 23 are much more likely to later split than those who wait until they’re 28, according to research from the nonpartisan Council on Contemporary Families.

Nicholas Wolfinger, a sociologist at the University of Utah, argues marital timing is important, labeling teens and those older than 30 as particularly high divorce risks. His analysis of data from the National Survey of Family Growth found the chances of breaking up shrink each year from your teens into your late 20s and starts rising again in your 30s. After 32, he wrote, the odds of splitting increase by 5 percent each year.

Your diploma(s) might also hint at your romantic future. Over half of marriages of people who didn’t complete high school end in divorce, compared to 30 percent of marriages of college graduates, according to the Bureau of Labor Statistics.

Your financial history may predict your success in love, too. A report from the Federal Reserve Board suggests people with higher credit scores are more likely to form a committed relationship, even when controlling for education and income.

And love longevity tends to vary by location. The South and West had the most marriages in 2012 (with rates of roughly 19 per 1,000 people), the most recent Census data shows, but the regions also tied for the lead in divorces (10 per 1,000).

Alaska, Maine, Oklahoma, Kentucky and Nevada saw the highest divorce rates. Connecticut, New Jersey, Massachusetts and New York saw the lowest. Researchers said couples on the East Coast wait longer to wed, which may curb the marital turbulence.