Making better choices
is not always this easy


Newsletter Archive

Three Financial Imperatives for Women in Divorce

Posted On: Monday, April 3, 2023

Three Financial Imperatives for Women in Divorce

There is a well-worn social myth that in a divorce from a heterosexual marriage it is the men that get fleeced while their ex-wives make away with the spoils. The reality, however, is very different.

Research from the London School of Economics found that women who worked before, during or after their marriages see, on average, a 20% decline in their incomes following a divorce. A man who leaves a childless marriage, on the other hand, sees his income rise by an average of 25%.

A separate study by the Chartered Insurance Institute (CII) in the UK found that ‘divorced women are far less resilient to financial risk’. The institute discovered that, on average, a divorced woman has a pension pot that is one third the size of a divorced man’s.

Financial risk

These figures show how much of a financial risk divorce is for many women. While women are less likely to be totally dependent on their husbands these days, divorce is still likely to leave them worse off.

To a large extent, this is because gender roles remain entrenched. Most wives will have sacrificed their own career progression to have children, set up their homes and support their partners. That will have compromised their earning power and ability to save. Even if the couple’s assets are shared equally at divorce, men and women do not, on the whole, have the same ability to rebuild from that point.

Divorce, therefore, should not just be seen as a legal process. The enormous financial implications should ideally be addressed together with a professional.

Three things you should really think about

  1. The pension

    In 2018, the charity Age UK reported that many women don’t realise that their husband’s pension should form part of a divorce settlement. In many breakups, men walk away with their entire pension, which exacerbates a wealth imbalance. 

    This was even the case when the money being paid into the pension was coming out of a joint bank account. 

    Women should not neglect the importance of any wealth held in a pension in their husband’s name. They should make sure that it is appropriately divided because this is a critical part of securing their futures.
  2. Do you really need the house?

    Many women place a lot of importance on keeping the family home, particularly if they have young children. There is certainly a psychological benefit to this, but it may not be in their best financial interests.

    That is because, for most couples, their primary residence is their biggest financial asset. If one of the partners keeps the house as part of the divorce settlement, that means that a big part of what they receive is tied up in this illiquid asset. The result is that there will be less cash for day-to-day expenses, or to save. Maintaining a property also comes with large costs, adding to the financial pressure.

    While moving house is an additional stress that most people would rather avoid at a time like this, it needs to be considered. The longer-term consequences can’t be ignored.
  3. Think ahead

    It may sound perverse to prepare for something that may never happen, but the best way for any woman to prepare for the most serious financial risks of a divorce is to make sure she has protected herself in advance.

    This doesn’t mean that everyone should be ready specifically for the breakup of their marriage, but only that being financially organised will make any disruption less painful. A woman who has built up independent investments, kept her debt levels low, and has her own emergency savings account will simply be in a better position to navigate the financial stresses of a divorce.

    It's also important to bear in mind that divorce itself can be expensive. Apart from the legal fees, there will be a transition period before a settlement is reached when the former partners may have to fend for themselves. Having a financial backup plan already in place will make this easier to handle.

To discuss, and prepare for, the financial consequences of going through any major life event, speak to a professional.

Please Register Below Or Login To Continue Reading.

First Name
Last Name


December 4 - Stock Markets Break Three-Month Losing Streak
December 3 - The Differences Between Life and Living Annuities
December 2 - Should you be an Optimist or a Pessimist With Your Money?
December 1 - How to Give Meaningful Gifts This Festive Season
November 4 - Market Update: The Effects of War, Higher Interest Rates and China on Equities
November 3 - Why do People Invest in Property?
November 2 - Retirement Planning: The ins and Outs of Nominating Beneficiaries
November 1 - Retiring Well is About More Than Money
October 4 - Why Your Marital Contract Really Matters
October 3 - How to Avoid Being Scammed by Email Fraudsters
October 2 - The Stock Market Indices to Watch When Monitoring Equity Performance
October 1 - Why do Some People Have a Problem Spending Money?
September 4 - The Difference Between Being Rich and Being Wealthy
September 3 - The Ins and Outs of Buying Offshore Property
September 2 - A Good Budget Doesn’t Limit Spending, it Prioritises it
September 1 - Should you pay off your home loan?
August 4 - How to Take Advantage of the Donations Tax Allowance
August 3 - Five Reasons why a Financial Windfall Must be Managed Carefully
August 2 - What’s Cooking with the Three-Pot System?
August 1 - Make Sure Your Family is Financially Prepared for When You Pass Away
July 4 - A Must-Have for Couples who Choose not to Tie the Knot
July 3 - Can Gratitude Make you Feel Better About Your Money?
July 2 - Four Ways to Make the Most of Retirement
July 1 - How to Invest When There’s So Much Bad News
June 4 - The Ins and Outs of Compulsory Annuities
June 3 - Who is Influencing Your Financial Decisions?
June 2 - R is for Rebalancing
June 1 - Don’t let Money Ruin Your Relationship
May 4 - Five Ways to Teach Kids About Money
May 3 - Much Ado About Risk
May 2 - Living Wills: A Must Have, Despite the Grey Areas
May 1 - What is True Wealth?
April 4 - How the 2023 Budget Will Impact Your Pocket
April 3 - Three Financial Imperatives for Women in Divorce
April 2 - Should You Ask ChatGPT for Financial Advice?
April 1 - Compound Interest: The Eighth Wonder of the World
March 4 - How a ‘Safe’ Fixed Deposit Might Still be Risky
March 3 - Thinking of moving to Australia? Bear these numbers in mind
March 2 - Avoid These 6 Barriers to Wealth Creation
March 1 - How Good do You Think You Are at Investing?
February 4 - Is Money Stress Taking a Toll on You?
February 3 - Why an Endowment is One of the Best Ways to Invest Offshore
February 2 - Why too Much of a Good Thing Can be a Bad Thing
February 1 - Invest With FIRE and Never Look Back
January 4 - Why Lottery Winners End up Broke: The Importance of Your Financial Context
January 3 - Discover the Freedom of a Tidy Portfolio
January 2 - Why You Absolutely Should be Investing in Education
January 1 - Four Simple Steps to Start the Year on the Right Financial Foot


December 4 - What is This Volatility Risk People are Always Talking About?
December 3 - Why You Need to Watch Out for The Butterfly Effect
December 2 - 6 Ways to Achieve Financial Freedom
December 1 - Three Books for the Holidays
November 4 - The Question of Loyalty
November 3 - Why do we Even Have Bull and Bear Markets?
November 2 - Should I Buy a Holiday House?
November 1 - Put Stocks, Rather Than Socks, Under the Tree This Christmas
October 4 - Can You Take Out Life Insurance on Someone Else?
October 3 - Loss Aversion and Lifestyle Creep – How Behaviour Influences Saving
October 2 - Why Timing Might be Everything in Retirement – Especially in a Bear Market
October 1 - Get Rich - Stay Rich Eight Mistakes Wealthy People Never Make
September 4 - Capital Gains Tax: 10 Common Questions Answered
September 3 - The Risk That Many Investors Don’t Think About
September 2 - Much Ado About Regulation 28 and the Private Investor
September 1 - The “Two Bucket” Retirement Savings System: What is it and Why is it Important?
August 4 - Retirement Planning for Age-Gap Couples
August 3 - A Simple “50-15-5” Budget Hack for Women (and Men!)
August 2 - Does Your Family Need a Constitution?
August 1 - Women’s Month: Three Ways You Can Improve Your Money Health
July 4 - Five Things to Check When a Loved One Passes Away
July 3 - Rules of Financial Planning For a Special-Needs Child
July 2 - Why Your Financial Plan Should Cater For Possible Dementia
July 1 - Why Inflation is the Most Important Investment Benchmark
June 4 - How Relevant Is The 4% Rule of Thumb These Days?
June 3 - Why You Should Treat Your Finances Like Your Health
June 2 - Is Your Business Good Retirement Capital?
June 1 - With the Limits Raised, How Much Should You Invest Offshore?
May 5 - Quote of the Month: Challenging the Rejection of an Insurance Claim
May 4 - Financial Products: The Less You Understand, the More You Pay
May 3 - The Miracle of Investment Debit Orders
May 2 - Five Things to Think About as Interest Rates Rise
May 1 - Stay Calm When the Bear Prowls
April 5 - Quotes of the Month – The War in Ukraine
April 4 - Smart Ways to Give: During and After Your Lifetime
April 3 - Take These Three Steps to Break the Money Shame Spiral
April 2 - When Things Don’t Go According To (The Financial) Plan
April 1 - What Amazon and Ford Can Tell Us About Diversification
March 4 - Quotes of the month – What the NFT?
March 3 - How to Avoid Losing Your Life’s Savings to a “Tinder Swindler”
March 2 - The Different Ways to Invest: What Does It All Mean?
March 1 - Three Reasons You Shouldn’t Wait to Talk to Your Kids About Money
February 6 - Quote of the Month – Don’t Cash In Your Retirement Savings
February 5 - Should You Top Up Your Retirement Annuities Now?
February 4 - Don’t Let Delays in the Master’s Office Leave Your Family in Financial Distress
February 3 - Don’t Let Delays in the Master’s Office Leave Your Family in Financial Distress
February 2 - Three Reasons an Insurer Could Cancel Your Policy
February 1 - Investing: Men and Women See Things Differently
January 4 - Quote of the month – Stay invested!
January 3 - What SARS Says About Crypto Assets and Tax
January 2 - Three Ways to Leave a Legacy, And Not Just an Estate
January 1 - Red-Carding the Myth of The Rational Investor