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Divorce makes you poorer

31st March 2015
Divorce makes you poorer

It is an unfortunate time to be an ex-wife in the British media.

First it was the hotly anticipated decision in Wyatt v Vince in the Supreme Court where (if one were to believe press reports) the ex-husband of the money-grubbing Ms Wyatt will be taken for his millions by his ex-wife of three decades.

That was followed shortly afterwards by the university lecturer who was tricked into paying large sums of child maintenance for a child who turned out not to be his.

And just last week, property tycoon David Stocker expressed disappointment in the press about the courts decision not to overturn a ruling which saw his ex-wife get £1.8million in property, while he walked away with just £250,000.

For the most part, the press do not paint a pretty picture of these ex-wives, and have added fuel to the ever-burning fires of the scorned woman being out for everything she can get. When interviewed on the steps of the court which upheld the financial settlement, what did the ex-Mrs Stocker have to say to the press? Divorce makes you poorer.

Note, however, that ex-Mrs Stocker did not say that divorce makes men poorer. This was far from a vengeful and now he has to pay snipe. Hers was a general sweeping statement on the financial consequences of the breakdown of a marriage. Despite press reports, it seems unlikely that Mrs Stocker walked away with exactly 80% across all the assets while Mr Stocker retained just 20% of his fortune.

So does the law allow ex-wives to walk away with the bulk of the assets accumulated during a marriage? Put simply: no.

White v White UKHL 54 established the principle that the division of assets in a financial settlement ought to be considered against the yardstick of equality. Family lawyers and the courts are interested in fairness; financial remedy proceedings are not a game to make one party richer than the other.

Wells v Wells EWCA Civ 476 discussed the importance of achieving a share by a fair division of both the copper-bottomed assets and the illiquid and risk-laden assets.

Without seeing the Stocker decision, it is impossible to comment with certainty on the precise division of the assets, but, knowing what the court will take into account when dividing the assets (principally the parties capital and income resources, their needs, the standard of living during the marriage, the age of the parties and any other relevant circumstances of the case) its possible that, while ex-Mrs Stocker walked away with large amounts of property, Mr Stocker walked away with a great share of the other assets: possibly shares, the businesses, pensions, or other investments.

Does divorce make men poorer and women richer? Put simply, again, the answer is no. Studies have long shown that despite the settlements seemingly in their favour, ex-wives often struggle in the long term.

Research carried out by Professor Stephen Jenkins back in 2009 (Marital Splits and Income Changes over the Longer Term) showed that on average male incomes rise by 25% following a divorce whereas womens fall by a fifth, even when children are not involved. When children are involved, the outcome for women is bleaker still. Fathers incomes will rise by a third while mothers incomes will continue to fall. There are unavoidable financial consequences of being the parent with whom the child resides, and more often than not, this is the mother. The woman will tend to work hours around childcare arrangements, often taking jobs and making career decisions around the family rather than the size of the salary.

All too often, the husband may feel as though he has lost in the financial settlement, but will then become financially secure within a couple of years, while the ex-wife will continue to struggle.

So why isnt research like this flagged up in the press, alongside the sensationalist headlines? There seems to be a dominant narrative that the husband has been robbed in divorce – the old Robin Williams trope of divorce being, shall we say, an affront to ones masculinity as well as to ones finances.

But then – you shouldnt believe everything you read.

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