Principle: Moral hazard is the idea that people or firms behave more recklessly when they're insured against risk. That's one reason why many big financial institutions engaged in risky lending in the last decade. They knew Uncle Sam could bail them out.
Payoff: It's also why singles exercise, groom, and put their best foot forward – and married folks, well, don't always. "What's great about marriage is that it can be safe harbor," says Szuchman. "You're with your best friend, you can be yourself.... But you shouldn't see your marriage as a safety net, as 'too big to fail.' " She suggests couples combat moral hazard by ensuring each partner is fully invested in the relationship and is accountable. "Take little steps," advises Szuchman. Just as you make an effort to get up in the morning and look good for work, do the same for your spouse. And don't always pick up the slack, she adds. "There's no better incentive for someone to do something than the fact it [otherwise] won't get done."
