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Barb, age 55, is recently divorced. She has found a new sense of life satisfaction. She works as a teacher at the local elementary school and has taken up hobbies such as ceramics, oil painting and spending time with friends. She hasn't had time for these hobbies since her twenties, before she and her ex-husband, Frank, had children. With the children out of the house and living a single life, Barb now has time to do the things she once enjoyed. She is adjusting to life as a single woman. Barb feels free from the tension she and her husband experienced over the last 15 years. But, her financial situation may not be in as good shape as it would have been if she remained married. Although she paid the bills and managed the household expenses for the family, she is concerned about retirement planning and devastated that they sold the house that she and Frank raised her children in.
Barb is not in a unique situation. Women are often left in poorer financial positions than their former male partners after divorce.
Defined as grey divorce or silver divorce, divorce is on the rise for women over the age of 50.1 Why? There are a number of factors. One is that this is the same cohort (baby boomers) that experienced increased divorce rates after the 1970's. Since marital instability increases with subsequent marriages, it may be no surprise that this cohort of women is experiencing all time high divorce rates in their 50's.2
Research results vary as to how marital happiness increases or decreases over time. Some research suggests that marital happiness follows a u-shaped curve or that there is some recovery in marital happiness later in marriage, while some research suggests that it either declines early in marriage and then flattens or continues to decline over time.3,4
When marriage quality follows a u-shaped curve, marital quality is high in the early years and declines as children enter the relationship and career demands increase. As life becomes busier, couples have a harder time investing in the relationship and quality time is hard to find. As a result, marital happiness decreases. When the kids leave home and work demands decrease, couples have more time for each other and can reconnect to increase marital satisfaction.
However, for marriages where happiness declines over time, couples may look at each other and say, "I don't know who you are anymore" or quite possibly, "I don't know who I am anymore." Or conflicts that were never resolved, like gendered norms and imbalances around housework, may worsen because they now can become the focus of the problems in the relationship. Of course, these couples could also simply have encountered the same life demands — job, children, busyness — and drifted apart.
Regardless of whether they were part of the financial planning process or the day-to-day management of the household finances, advisors will likely need to help give women a boost in confidence.
Investing in Marriage
Divorce may be the best answer for some marriages when the couples grow apart. However, couples who have invested regularly in their "relationship account" over the course of their marriage may be able to avoid that outcome. Much like investing regularly into a 401(k) or other retirement accounts, relationship assets grow over time. That means investing in making time for the couple relationship without distractions from kids or work (e.g., date nights, couple-only vacations, time alone after kids go to bed, etc.).
Obviously, time alone isn't enough. Having open and meaningful conversations with one another about parenting, sex, and money, as well as life dreams and goals, are essential to continue the relational bond and keep trust intact. Meaningful conversations may mean differences in opinions, values, ideals, or conflicts about the best way to reach goals. Couples may be afraid or unwilling to "rock the boat" or take the time and energy to engage in such conversations if it will cause stress and strife. As a result, important issues often are ignored and partners may be left feeling alone, unfulfilled, and feel as if they do not know who they are married to anymore.
We know that life experiences bring about change in values, attitudes, and beliefs. These may have changed over time and partners may not recognize each other anymore. Couples may have difficulty communicating, difficulty relating to one another, developed different circles of friends through work, church, or kids' activities, or during the busyness of life they grew apart. Life's focus might have been on children and/or career demands and investing time in the marital relationship fell to the wayside.
As an advisor, why should you care? What should you do?
The Advisor's Role
Let me suggest two things for you to think about as an advisor to a recently divorced older woman.
First, know that divorce is hard and the emotions that must be processed are messy. Divorcees go through a grieving process because there is a loss of a person in one's life and a significant part of that person's life is now over. Normalizing these emotions is important as recently divorced clients may feel out of control, angry, sad, or depressed. Keep in mind that irrational behavior may go hand-in-hand with the grieving process. What may seem like irrational behavior, like not wanting to sell the house when it is the best financial decision, needs to be processed in a mindful, caring, and thoughtful way. Selling the house may be particularly difficult for women because they may be emotionally attached to the home in which they raised their family and selling it may feel like yet another loss. Advisors need to use their best listening skills, where they listen to understand (not simply respond). Understanding "irrational behavior" is difficult when you do not know the story behind the behavior.
For example, giving women the opportunity to share their favorite memories they have about the house and what the house represents for them can be meaningful and helpful to process the emotions tied to the house. Then, advisors can help clients to think about their futures: What does a "home" mean to you? How would you know if you were at "home"? How can you create a "home" in a different location? What are new things you want to do with a different home? Clients will cry and the advisors should be prepared with tissues and listening ears. These questions should be processed slowly and with caution. Depressive symptoms may occur and if this is the case, the advisor should refer to a mental health specialist, preferably one who specializes in working with women and divorce.
Secondly, older women clients may have lower confidence in their financial skills in general. Regardless of whether they were part of the financial planning process or the day-to-day management of the household finances, advisors will likely need to help give women a boost in confidence. Giving clients doable tasks to help them understand their financial position and taking time to review that position with the client is helpful. Doable tasks can be setting new goals, accessing credit reports, and discerning assets and debts. Going slowly and one at a time may be helpful as these tasks, which may seem small or easy to you as the advisor, may be incredibly overwhelming to the client who lacks financial knowledge, capability, and confidence.
Lastly, for your still-married clients at any age, consider suggesting to them that investing in the relationship is a normal part of the advising relationship. That is, you encourage them to engage in relationship enrichment to help maintain a higher sense of satisfaction and to help them be prepared to manage through difficult times. You could do this by referring or working simultaneously or in collaboration with a relationship expert. Or you could refer them to a financial therapist whose expertise is in couple relationships and has a specialty with working with money-related issues. We often do not think of marital relationships as an investment for the couple. However, it's quite likely the relationship is their most valuable asset.
Of course, for some, divorce may be inevitable. Helping couples transition through the major life transition of divorce may be a time to call in a divorce specialist or mediator especially for high-conflict couples.
Here are some places to find a couple relationship expert, financial therapist specializing in couple relationships, or family mediator:
1Kennedy, S., & Ruggles, S. (2014). Breaking Up Is Hard to Count: The Rise of Divorce in the United States, 1980–2010. Demography, 51(2), 587–598. http://doi.org/10.1007/s13524-013-0270-9
2Brown, S. L., & Lin, I.-F. (2012). The Gray Divorce Revolution: Rising Divorce Among Middle-Aged and Older Adults, 1990–2010. The Journals of Gerontology Series B: Psychological Sciences and Social Sciences, 67(6), 731–741. http://doi.org/10.1093/geronb/gbs089
3Anderson, J. R., Van Ryzin, M. J., & Doherty, W. J. (2010). Developmental trajectories of marital happiness in continuously married individuals: A group-based modeling approach. Journal of Family Psychology, 24(5), 587-596. http://dx.doi.org.er.lib.k-state.edu/10.1037/a0020928
4VanLaningham, J., Johnson, D. R., & Amato, P. (2001). Marital Happiness, Marital Duration and the U-Shaped Curve: Evidence from a Five-Wave Panel Study. Social Forces, 79(4), 1313-1341.
The views and opinions expressed herein are those of the author, who is not affiliated with Hartford Funds. The information contained herein should not be construed as investment advice or a recommendation of any product or service nor should it be relied upon to, replace the advice of an investor's own professional legal, tax and financial advisors. Hartford Funds Distributors, LLC.