Women typically earn less than men following a divorce, a new report suggests.
Researchers from the National Centre for Social and Economic Modelling (NATSEM) at the University of Canberra in Australia found that divorced women earn around ten per cent less than their married peers. By contrast, divorced men earn an average of 26 per cent more than married men.
The number of women who go to work is 14 per cent higher among those who have divorced than married women, but the end of a marriage has very little effect on the employment rate of men.
Newly divorced mothers spent more than 66 per cent of their household budget on ‘essential’ items the researchers found. These include food, utility bills and clothing. Around 20 per cent also struggle to afford things like school uniforms and 30 per cent find the cost of childcare difficult to manage.
The report, titled For Richer, For Poorer, was jointly published by NATSEM and financial management firm AMP. Paul Sainsbury is the Chief Customer Officer for the latter. He said that “most couples don’t plan for divorce” and this “often means finances are a lower priority and mishandled during a separation”. As people are divorcing later in life “the long-term financial impacts can be considerable” he explained.
In 2014, a study by investment service Nutmeg found that more than half of women worried about how they would cope financially if they divorced. This research also revealed that as many as a third of women have no retirement savings and 18 per cent of divorced women had to rent a place to live as they could not afford to buy a house.
Read For Richer, For Poorer here.
Photo courtesy of Ken Teegardin via SeniorLiving.org.