Financial Matters for Women in Divorce

/// By Aviva Sapers and Lisa M. Cukier

Regardless of the circumstances, divorce is always an emotional, financial, and logistically challenging time for everyone involved. But for women, who are historically less often the primary breadwinner or financial record keeper in a marriage—and more often the primary caregiver for children and aging parents—divorce can pose heightened challenges that deserve particular attention.

According to a report by the Bureau of Labor Statistics published in 2016, in heterosexual marriages where both husband and wife are employed, the man out earns the woman 77.8% of the time. This means that in the wake of a divorce, many women will lose more than half of the household income they’ve come to depend on. Along with the time responsibilities and career sacrifices that are attached to the role of primary caregiver—it is easy to see how divorce can carry an unequal financial burden for the women in a relationship.

Alimony laws are set up to ease some of this burden, offering a percentage of the difference in incomes, usually around 25%-28% of the payor’s income per year, based on the length of the marriage. But dividing property and mortgage responsibilities, 401(k) assets and other retirement holdings, and insurance coverages, further complicates a split. It changes the metric of affordability and comforts in life for all involved.

Certain steps can be taken to mitigate some of the uncertainties that must be navigated through an already emotionally difficult time:

Claiming Financial Literacy/Control

The first basic but vital factor that can help women through this process is to take some interest and control over their financial lives before the possibility of divorce even arises. By familiarizing yourself with the various aspects of your family’s financial situation early, a woman can ensure an understanding of the overall picture of income flow and budgetary constraints, retirement holdings, educational planning, and insurance coverages that affect the whole family. This way, in the case of a divorce, the woman will know what to ask for and how to best position herself for an equitable and protected future.

One important step that can help to facilitate an awareness and involvement with financial matters around estate planning is to update and always stay on top of the official beneficiary status of various accounts. With every life change: new children, new job benefits, new property, etc., designating the beneficiary line to best reflect the full family picture can save significant time and strife in the unfortunate event of a divorce. This step can ensure that any pre-marriage relationships, unequal child distributions, or ancillary family members are not the unplanned inheritors of financial record.

Don’t Go It Alone

Though money can become a central focus amid the financial strain of a divorce, when there are significant assets to distribute and any level of contention involved, the added expense of professional legal and financial advice can greatly increase the chance of a good result. Especially if the woman in a divorce is less involved with the family’s financial picture, professional help can be invaluable to knowing what to ask for and how to go about getting it.

Depending on length of marriage, employment, financial contributions, caregiving/homemaking responsibilities, age, health, station in life, and opportunity to acquire assets in the future—there will be spousal support and/or division of assets in a divorce that you are entitled to by law. Whether it’s an attorney to navigate the settlement, a divorce mediator to help you reach an agreement, or a forensic accountant to make sure that you receive everything you are entitled to—outside consultation and third-party expertise may be the best money you can spend in such fraught moments.

Financial Priorities in Divorce

While everyone loses financially in a divorce, done right, both parties should be able to part with a fair share of the assets they need and some of what they want. For women, who more often get primary custody of the children, budgeting for household needs and the financial burden of caregiving is vital. Whether it’s planning for groceries, day-to-day activities, or educational expenses—a realistic budget of what is required and what the future will demand will be an important factor of the settlement. Women are also more often awarded the primary property in a divorce, so budgeting for the maintenance, mortgage, taxes, and general upkeep of a house is also necessary.

Creating a checklist of financial priorities for a divorce is a good place to start and approaching the negotiation process with a working budget of needs will help to create the framework to build from. A financial advisor can also help you to arrange and revise your priorities to optimize results.

Retirement Assets & Insurance Continuity    

One of the most valuable issues to focus on in a divorce is an equitable sharing of retirement holdings. Whether a 401(k), IRA, or other retirement vehicle—the importance of the passage of time in building value for retirement should not be overlooked in a settlement. Though the immediate needs of property and living expenses will often take much of the focus, the long-term demands of retirement savings may be just as important to maintain quality of life and financial security moving forward.

It is just as important, to maintain appropriate insurance coverage for women and children, especially when coverage is tied to a soon-to-be ex-spouse’s employment. Including ongoing or replacement insurance costs, limiting life insurance beneficiary designation changes, and other insurance-related decision making in a divorce negotiation can help to alleviate unnecessary stress in the process. In addition, women should consider including a long-term care insurance policy as part of a settlement for further financial protection through retirement years.

Family Trust & Family Business Vulnerability

For women who rely on the money of family trusts, divorce can dictate the need to share that income stream with an out-going spouse. If the financial pattern of reliance on a trust is woven into the fabric of a marriage, a spouse may be entitled to a continuance of access to the money involved. Strategic plans can and should be made with a financial advisor to help mitigate the vulnerability of such assets and concessions may need to be made in other areas to keep control of such family-based income.

Likewise, extra precautions may be required with the involvement of a family business. If a woman shares control of a family business with her spouse, steps should be taken to protect fiduciary control for her family during, if not before, a divorce negotiation.

Setting Goals & Moving Forward

Finally, women need to know that acculturation in our society has made it easier for men to make money while placing an undue burden on women against moving on after a divorce. Between the historic challenges of equitable earning for themselves, the primary custodial responsibilities that often continue long after alimony payments end, and the societal stigma around starting over—women face an oversized hurdle in answering the question, “Am I going to be okay?”

With the right preparation and trusted advisors to help navigate the process, the answer to this question in any divorce should be, “yes.” If you have questions or needs concerning your own situation and the prospect of divorce, don’t hesitate to reach out:

LISA M. CUKIER is a Partner, Co-Chair of the Private Client Group, and Executive Committee member at Burns & Levinson LLP in Boston. Her law practice includes sophisticated high end divorce, divorce impacted by family trusts and family business, blended family planning and litigation, fiduciary representation, trust and estate dispute resolution and litigation, family crisis and family dispute resolution, mental health and addiction related legal interventions, elder law, guardianship and conservatorship litigation, grandparents visitation matters, and elder financial exploitation and undue influence matters.

She can be reached at 617.966.9582 or

AVIVA SAPERS is the President and CEO of Sapers & Wallack – a full-service employee benefit and financial service firm in Newton, MA. She advises business owners and high net worth individuals on minimizing estate taxes, how to attract, retain and reward key people, how to prepare for unexpected financial challenges, charitable strategies, and more. Recognized as a leader in women run businesses in New England, she specializes in creative solutions for women led businesses and women focused financial support and has been told that she explains complex financial strategies in ways women can understand.

She can be reached at 617-225-2600 or