“Our” Money: How divorce is different when you earn more than your husband

More and more frequently, I am seeing women who are better off financially than their husbands. There are still a large number of women who are disadvantaged economically, usually because of the dual constraints of raising children and maintaining a household, but this number seems to be decreasing. Or, at least, the number of women who are incredibly professionally successful are increasing enough that they have attracted some notice.

This is great news. Although I wouldn’t make a huge leap and say that there is economic equality for both men and women, it’s obvious that women are able to do better for themselves now than ever before. Check out the numbers of men versus women enrolled in college—and even law school! The trend is really catching on. In fact, even the folks on the other side of the pond are catching on. If the Duke and Duchess of Cambridge have a baby girl, she could be Queen (and even marry a Catholic, if she was so inclined), rather than being secondary to a second-born son. If the Duke and Duchess have two little girls, they would still have “an heir and a spare”!

But what does that mean for real people? The women with whom I meet that have more than their husbands are usually the most intimidated—because they have the most to lose. Retirement accounts into which they have been diligently funneling money could be divided in half and given to an ex-husband who was not quite as financially conservative. Not to mention the horror of having to pay spousal support!

Well, unfortunately, the truth is that anything you earned DURING the marriage is not “my money” or “his money”—it’s “our money,” and it will be divided as such. Whether or not it is in your retirement account, it is “our money.” Spousal support is also a possibility, but the reality today is still that far fewer men ask for support than women. (Remember, though, that anything you earned before your marriage, or anything that was given to you during the marriage by someone other than your husband is yours separately, and he can’t ask for part of that.)

Life doesn’t end on the day your divorce decree is signed, however. Statistics show that low income recently divorced women are twice as likely to live in poverty as their male counterparts. Women with a degree of separate financial security, on the other hand, are considerably less likely to live in poverty because they have a separate and distinct form of income of their own (which becomes “my money” upon separation, even if you still have to pay some degree of support). The divorce process, too, tends to educate women about money, including retirement and investment accounts, which can lead them to make more informed financial decisions later. Coupled with their high earning potential, these women often find themselves in a stronger place post-divorce than pre-divorce (especially if ex-hubby wasn’t quite so financially savvy).

It can be painful to divide up that retirement account before divorce, but remember that life does go on afterwards. If you feel like you’re the one with more to lose financially than your husband, don’t despair. You’ll be grateful, later, for your advantageous economic position.

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