“For some, it means liberation. For others, loss. For women in particular, the doubling of the divorce rate for the 50-plus crowd since the 1990s can mean something far more prosaic: a need to shoulder the big financial decisions they’d let their spouses deal with, when they were married.”
Bloomberg’s recent article, “Rise of ‘Gray’ Divorce Forces Financial Reckoning After 50,” found that a majority of married women (56%) still leave major investing and financial planning decisions to their spouse, according to a report titled “Own Your Worth” by UBS Global Wealth Management.
The study shows that it’s not just older women moving into the more traditional gender roles of their parents: about 61% of millennial women said they leave investment decisions to their husbands. This contrasts with 54% for baby boomer women. UBS surveyed more than 600 women who have either been divorced or widowed within the last five years, along with 1,500 couples. Respondents needed to have at least $250,000 in investable assets to take part in the study.
The difference between attitudes toward making major financial decisions between married women and women who were divorced or widowed is remarkable. Almost 60% of widows and divorcees regret not taking part in long-term financial planning, when they were part of a couple.
About 85% of married women who weren’t active in making long-term financial decisions, said that their spouse knows more about financial issues than they do. A total of 80% of women said they were okay with how financial responsibilities were split in their relationship.
Almost all of them would counsel other women to get more involved early on and stop the cycle of financial abdication. Of those women who were divorced or widowed women in the survey who remarried, 80% were more active in the financial decision-making in their current relationship.
Divorcees may have been surprised by financial news that came up in their marital split. More than 55% of divorcees and widows found new financial issues when divorcing. Some women discovered 401(k) retirement saving plans they didn’t know existed or were simply shocked at how little they knew about their finances. Some of the most common negative surprises were hidden spending, hidden debt, and hidden accounts. Outdated wills were another unwelcome find. In hindsight, 94% of widows and divorcees said they’d demand complete financial transparency with their spouse.
Reference: Bloomberg (April 15, 2018) “Rise of ‘Gray’ Divorce Forces Financial Reckoning After 50”