Separation and Divorce | Women Are The Worse Off

If you are a woman and have the misfortune to separate after having children, you are probably in for a rough ride financially.

The data tells us that women are worse off than men five years after separation. But the extent of the difference, and how that could be altered, needs more discussion.


Most women who have children take time out of the work force, some for many years. Often women are separating at a time when they have not been in the paid workforce for ten, twenty or more years. In any case, it is likely that the male partner has continued to build a career and income at  a greater rate than the woman.


Australian Divorce Law Disadvantages Women

At the end of a marriage or relationship, Australian law sets an expectation that the financial relationship between spouses ends soon after separation. This encourages the idea of dividing assets in a way that is said to favour wives who have less income than their husband, and on a percentage basis often does so on the face of it. This is because future spousal maintenance is paid in a lump sum. It has become customary to look at this payment or compensation as a percentage of the assets pool. Usually that adjustment is around 5% to 10% of the assets. This is a fatal flaw, except where there is a large asset pool.  A percentage adjustment is meaningless in most cases. What we need to be doing is projecting the financial paths of the couple after separation, to see what the fate of each one is likely to be in the long term.


Women typically don’t want to be tied to their former spouse in the long term, and nor do men, who are most often keen to rebuild their financial future, using the resource of their income. These sentiments need to be balanced against the reality for women of doing a deal at the end of their marriage, that condemns them to poverty, brought about by ‘Mummy tracking’ their career. That division of labour often works well during a marriage, but at separation, many women pay a significant price for their role as a mother.


Separation Use The Services Of A  Financial Planner

Both halves of the couple make settlement deals, whether with lawyers or mediators involved or not, that neither one of them fully understands. Most men don’t want their wives to face poverty, but in the absence of sensible financial planning evaluation and projections, neither men nor women can impartially evaluate the implications of settling on percentages.


When there is a real disparity between the finances of a couple, that sets up resentment and conflict that never heals, and plays out in co-parenting. It is time to call a stop to talking about percentages as the basis of settlements and Court Orders and to look at real numbers instead.

Melbourne Divorce Lawyer Marguerite Picard