A Common and Troubling Problem for Divorcing Women Nearing Retirement

Take a moment to imagine how an “ideal” marriage—setting aside for a moment that there is likely no such thing—would function in terms of finances. What do you see?

I’m envisioning a true partnership, built on mutual respect and maintained with frequent, open communication. Each spouse would be fully aware of and equally able to manage all aspects of the marital finances. Neither would feel anxious, uninformed, or left out. In this marriage, money would not be a source of anger, mistrust, or resentment. Husband and wife would function as a team with common goals, including a financially healthy retirement.

Sound good? Well, as you might guess (or know from personal experience), most marriages fall a bit short of this vision.

Fidelity Investments conducts an online biennial Couples Retirement Study which examines how couples deal with family finances, particularly where retirement is concerned. For example, the 2015 study analyzed the retirement and financial expectations and preparedness of 1,051 committed couples (at least 25 years old, and with a minimum annual household income of $75,000 or at least $100,000 in investible assets). Results show that in many couples, there are significant differences in what each partner knows and expects about their retirement financing.

This infographic lays it out: Although 72% of couples surveyed reported communicating exceptionally or very well about financial matters, 60% of the respondents disagreed on what their Social Security payments would be in retirement, and more than 40% couldn’t even correctly identify how much their partner earns—that’s a major disconnect!

And there’s more: Almost half of the couples surveyed had no idea how much they would need to save to maintain their current lifestyle in retirement. More than half (51%) reported worrying about outliving their savings. That’s up from 42% in 2013. Even so, 36% say they haven’t even thought about developing a retirement plan. (In 2013, that figure was 28%.)


In short, the study found that American couples are worrying more, and planning less, than just two years ago.

Of course, investment companies are eager to make it easier for people to identify and understand how much they’ll need to retire comfortably, and to devise strategies to ensure there’s the money available to do it. Having commissioned the study, it’s likely that Fidelity has identified a role for itself in improving this situation.

Divorce financial advisors can help, too. As someone who works exclusively with women, I’ve noticed that in many marriages where there has been some retirement planning, savings, and investment, it’s typically the husband who’s done it—and the wife who is, for whatever reason, uninvolved and essentially in the dark. It’s a major concern to me that wives participate so little in the major financial decision-making of their marriages. In the event of a divorce, lack of financial literacy has very serious implications for a woman’s financial future.

Achieving a secure retirement should be a primary financial goal for all adults. Ideally, married couples work as a team to plan for their retirement, invest, and save according to strategies they discuss openly with each other and their financial and tax advisors, and then check in on a regular basis to make adjustments as needed. In the real world, though, things often don’t work quite that well. If you’re happily married, I advise you to work toward improving your knowledge of and communication about finances. If you’re divorcing, getting up to speed is a matter of absolute urgency as a means to the best settlement possible.