Many women get a rude financial awakening when they divorce

Boomers and millennials alike still 'abdicating important decisions' to their husbands

Apr 13, 2018 @ 12:32 pm

By Bloomberg News

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.

Often, they find some nasty surprises after he's gone.

A majority of married women — 56% — still leave major investing and financial planning decisions to their spouses, according to a report, "Own Your Worth," released today by UBS Global Wealth Management. It's not just older women slipping into the more traditional gender roles of their parents: 61% of millennial women said they leave investment decisions to their husbands. That compares with 54% for baby boomer women. UBS surveyed more than 600 women who have either been divorced or widowed within the last five years, and 1,500 couples. Respondents had to have at least $250,000 in investable assets.

The difference in attitudes toward making major financial decisions between married women and women who were divorced or widowed is stark. Fifty-nine percent of widows and divorcees regret not taking part in long-term financial planning when they were a couple. Eighty-five percent of married women who weren't active in making long-term financial decisions said their spouse knows more about financial issues than they do. Eighty percent of women said they were content with how financial responsibilities were split in their marriage.

"Despite all the strides that women have made, they are still abdicating important financial decisions that will profoundly affect their future," said Paula Polito, chief strategy officer for UBS Global Wealth Management, in an email. "Women and divorcees who find themselves alone wish they had been more involved in finances while they were married. Nearly all of them advise other women to get more involved early on and break the cycle of financial abdication."

Those women practice what they preach. Of the divorced or widowed women in the survey who remarried, eight out of 10 were more active in the financial decision-making in their current relationships. (That's a good move, as subsequent marriages have a higher rate of dissolving than do first marriages — and because women have longer life expectancies than men.) Divorcees may have been burned by financial surprises that popped up in the split. Fifty-six percent of divorcees and widows discovered new financial wrinkles in the process of splitting up. Not all were negative — some women discovered 401(k) retirement plans they didn't know existed. Others were simply surprised at how much they didn't know about their finances.

Among the most common negative surprises were hidden spending, hidden debt and hidden accounts. Outdated wills were another unwelcome discovery. In hindsight, 94% of widows and divorcees said they would have insisted on complete financial transparency with their spouses.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

Retirement: it's no longer about feeding pigeons from a park bench.

Today's retiree's expect so much from retirement than previous generations and advisers are in prime position to help their clients what's important and what's not.

Latest news & opinion

Trump tax plan making dividend ETFs hot

Funds that are seeing inflows largely steer clear of sectors like utilities.

Wells Fargo Advisors continues to see a decline in brokers

Company also set aside $114 million over fees for rich clients.

Morningstar to replace funds in its managed portfolios with nine of its own

New sub-advised funds, offered exclusively through financial advisers, are intended to lower costs and provide 'greater flexibility.'

Average client assets top $2 million for first time

Charles Schwab's latest RIA Benchmarking Study reports organic growth is driving increased AUM and revenues.

Merrill Lynch launches fiduciary dashboard for advisers

Despite death of the DOL fiduciary rule, wirehouse continues to invest in ways to meet best-interest standard.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print