Navigating a divorce can be emotionally devastating. However, unfortunately, marriages come to an end in Australia every day. It’s not surprising that compared to men, women suffer significantly more financially from a divorce or separation. In fact, men tend to experience greater financial success post divorce – highlighting the glaringly present divorce gap.
One study found that, on average, women experience a 20% decrease in income and a 27% increase in the risk of poverty after a divorce. On the other hand, men experience a 30% increase in both income and living standards. Due to this, women also experience a greater risk of homelessness than men.
This imbalance has two main causes. Firstly, the gender pay gap usually creates a steep imbalance in income between a husband and wife. Secondly, child rearing and unpaid household duties typically fall on women, meaning they have less time and energy to work or advance their career.
Additionally, when entering into a divorce, women often don’t understand the process, their rights or the financial value of their contributions. Therefore, if you are navigating a divorce, it is essential to keep the following in mind to ensure you empower yourself financially and give yourself the best chance at a stable future.
1. Understand the worth of your contributions
Many people don’t understand that their role as a homemaker is relevant under the Family Law Act. Time spent towards child rearing and household duties is factored in as part of any financial settlement between the parties. Make sure you recall your contributions as accurately as possible.
Many women have been conditioned to undervalue the importance of their input to the household. However, while you have been busy raising kids, cooking meals and cleaning the house, you have freed up time for your spouse to earn an income and advance their career, so your contribution is critical.
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2. All assets are pooled
When you are navigating the settlement, remember that all your assets are pooled. Even if your family home was purchased solely in your spouse’s name during the course of the marriage does not mean that you are not entitled to your fair share of the property value. The same goes for bank accounts and other investments. Name does not necessarily equal possession.
3. A note on superannuation
Sadly, the superannuation system is outdated and in desperate need of an overhaul. While women are at home raising children, their spouse is working and earning a comfortable retirement. The stay at home parent is effectively penalised.
On the plus side, like all other assets, superannuation is pooled during a divorce. Therefore, you may have access to some of your spouse’s super funds.
- You need professional advice
Investing in professional legal advice when navigating a settlement is crucial. A specialised divorce lawyer can potentially save you hundreds of thousands of dollars since they know what you can include in your negotiations. For example, if you don’t have an income, your lawyer can include your expectations for your financial needs post divorce as a worthy consideration in the settlement split.
Being honest with your lawyer about your assets, contributions and future needs will help you obtain the best possible financial outcome post divorce.
Divorces can be messy and are almost always emotionally crushing. Keeping the tips from this article in mind will help you achieve financial stability and increase your chances of living a full, enjoyable life into the future.
By Cassandra Kalpaxis
ABOUT CASSANDRA KALPAXIS
Family lawyer and founder of Australia’s first divorce retreat ‘Detox your Divorce‘ Cassandra Kalpaxis, (Bachelor of Laws and Bachelor of Social Science), is reshaping the way Women think about divorce and separation. Cassandra has seen first-hand how an amicable divorce can lead to more stability in the life of both parties and their children. To promote this ethos, she opened Kalpaxis legal in 2017 – a collaborative family law firm, emphasising the continuity of relationships over asset grabbing. Placing a large emphasis on the rights and concerns of Australian women, Cassandra makes her clients feel supported in times often associated with darkness.
