Striking out on your own


29/07 - Category: Family


"Marriage is about love; divorce is about money." - Anonymous


Divorce is a difficult time. No matter what the circumstances, coming to terms with the breakdown of a long-standing relationship can be traumatic. For many separating couples, the added pressure of issues like child custody and property settlement can cause an already fragile relationship to shatter. And yet keeping a level head can be critical when you are trying to negotiate a positive financial outcome for yourself. And yet for some reason, women seem to end up worse off after divorce on this score.

Research from the Australian Institute of Family Studies 2007 revealed that divorced women reported much higher rates of financial hardship over those who were married or their spouses, even when taking into consideration child support payments.

Of particular concern was the fact that this financial situation did not improve over time, but actually worsened as they got older. It seems that an initial decline in income can limit future lifestyle choices, leading to a lack of financial control and a decline in overall wellbeing.

While no-one plans to get divorced, this suggests that there is an argument for a pragmatic approach during the marriage. Perhaps staying involved in financial decisions or maintaining some degree of financial independence may help alleviate some of this disadvantage in the event of a split.

Regardless of your situation, dealing with the complex aspects of a financial settlement can be daunting, so obtaining professional financial and legal advice during the process can be beneficial.

It’s also not a time to procrastinate or leave things to chance. Instead, be proactive and take charge - remember it’s your future that’s at stake.

Things to consider when establishing your independence:

  • Setting yourself a realistic budget and make sure you can live within it

  • Seeking professional advice to update your Will
  • Making sure your insurance polices are up-to-date, and check in who’s name they are held
  • Establishing an emergency fund, to ensure you have some money aside for unexpected bills and expenses
  • Being pro-active when it comes to planning for your future, including investing and Superannuation contributions.

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    1. October 28th, 2009 at 9:16 am

      Karen

      Hi Antonia,

      Commonsense info about divorce.
      I know exactly what you mean by trying to keep a level head through the financial settlement…Going thru it right now!! Karen

    2. January 30th, 2010 at 9:40 am

      Ash Patil

      Well put Antonia.

      I think I would go further and urge all women to consider a pre-nuptial agreement prior to marriage, and regularly updated post-nuptial agreements.

      Given that marriage almost always involves the woman compromising career when children are born, it is important to be aware of the joint financial circumstances, and always consider “what if” in the case of divorce.

      This issue is too seldomly ignored by married people, beleiving that they will not divorce, and yet it will happen to he majority of us.

      There is also a concept that one will take offence at a pre-nuptial agreement and it will sully the relationship. However just like life insurance, one must always prepare for the unforseen, and this is no exception.

    3. February 10th, 2010 at 9:05 am

      Diana Haw

      After nearly three years - I’m now able to work through the shocking and the dark place and work towards building my life back and financially meet goals each day. :)