After divorce, women rebound faster but stay in poverty longer. Divorce funding can provide the funding bridge that some divorcing spouses need.
By Brendan Lyle
Men take more time to recover emotionally from a divorce, but women suffer a longer-lasting financial hit.
That’s according to the Australian Institute of Family Studies, which presented its research at a conference this July.
The institute’s research shows that, after a divorce, women’s household incomes dropped significantly, especially in the first year after the split. Men, on the other hand, saw continued income growth.
The information, gathered by the Australian Institute of Family Studies, suggests that six years after a divorce, some women in the study had regained their pre-divorce income levels through re-partnering, working for pay, and receiving government benefits.
The same study noted that women with dependent children, however, found it much more difficult to combine paid work with family obligations. The employment rate for women with no dependent children was far higher than the rate for women with children still at home.
These findings aren’t a surprise. According to George Mason University Sociology and law professor Lenore Weitzman, a typical woman endures a 73 percent reduction in her standard of living after a divorce. Her typical ex-husband enjoys a 42 percent better standard of living.
That’s largely because raising children is expensive and time consuming, and mothers still raise children more often than fathers do. According to an analysis of the 2010 Census data conducted by the National Women’s Law Center, approximately 25 percent of divorced parents have joint custody of their children. Of the remainder, the analysis shows, 15 percent of fathers have sole custody, while a whopping 60 percent of mothers have sole custody.
Non-custodial parents are typically ordered to pay child support, but ordering that child support and actually collecting it can be quite different projects. According to the 2010 U.S. census, 40 percent of households headed by women live in poverty. More than half of impoverished children live with their mothers, but not their fathers.
Don’t look to wages to make up the gap. The 2010 U.S. census says that, on average, a woman who worked for pay all year full time made 77 cents for each dollar earned by a man working similar hours. If that woman is black, she made 62.3 cents for each dollar earned by a white man. If she is Hispanic, she made 54 cents for every dollar a white man earned. The National Women’s Law Center’s ongoing analysis of that data suggests those numbers haven’t changed much over the last decade.
Women make up a majority of taxpayers in this country, and it’s in no one’s best interest to keep them in poverty.
Increasing educational levels will help. A September 2010 story in Inside Higher Ed says that women now form a majority in many undergraduate and graduate programs. The New York Times noted the same phenomenon in a February 23, 2012 article on U.S. bachelor degrees.
Reduced numbers of teenage births, which can keep women from achieving their educational and professional potentials, will help. According to April 2012 numbers from the National Center for Health Statistics, in 2010 that number was at its lowest point since 1946.
Increased efforts to collect child support will help, as will growing attitudes that rearing children is a job that belongs to both parents.
For women with children who are divorcing now, however, a fair divorce settlement can be the difference between poverty and a decent life.
Though many divorcing couples treat each other fairly and respectfully as they work out financial settlements, a minority of former spouses—usually husbands—hide money, cut off lines of credit, empty bank accounts, and try to starve their exes into accepting unfair settlements.
These women may have little option—unless they can find the money to hire high-quality attorneys and forensic financial specialists who can find hidden assets and successfully argue for a fair settlement.
Divorce funding can provide the funding bridge that some divorcing spouses need. Divorce funding offers qualified exes lines of credit that help them pay legal costs, expert fees, and living expenses while they work toward a fair divorce settlement. It’s an increasingly popular product that can help divorcing spouses find hidden assets, ensuring a more secure financial future for themselves and their children.
Brendan Lyle is the CEO of BBL Churchill Group, America’s largest provider of divorce finance. Brendan is a qualified attorney in Australia, NZ and the UK. He also holds a Masters in Applied Finance. Prior to his current appointment, Brendan founded and ran Impact Capital Limited, the largest consumer litigation funder in Australia and New Zealand. Brendan is a popular contributor to the Huffington Post’s Divorce section and a coveted speaker at many family law events. BBL Churchill is based in the Financial District in Manhattan and services clients in New York, New Jersey, Florida and other states on a case-by-case basis.