Women’s financial well-being through separation and divorce survey, May 2023

Key takeaways

Women who worked with an advisor as part of their separation or divorce process were more likely to agree that the settlement was fair and equitable for both parties. Of respondents who worked with an advisor, 65% felt their settlement was fair and equitable. Of respondents who did not work with an advisor, only 35% felt this way.
In general, respondents indicated that after a separation or divorce, more immediate goals like budgeting and saving tended to increase in importance over longer-term goals like estate planning and investing assets.
Although a majority of respondents indicated an increased importance of more immediate financial needs like budgeting (71%) and building an emergency fund (72%), those that worked with a financial advisor were, in general, more likely to indicate increased importance across a broader set of financial goals vs. those that did not work with an advisor.
Women who worked with an advisor were more likely to place increased importance on goals like managing assets post retirement, paying off low interest debts and investing their assets in the best way possible helping clients maintain focus on long-term financial health.
Women who worked with an advisor as part of their divorce settlement process were, in general, more likely to say that the achievement of their goals had been accelerated and less likely to say they had been delayed, relative to those who did not use an advisor.
Although all survey respondents indicated that divorce had an impact on their financial goals, on average, those who worked with an advisor were more likely to rate their goals as accelerated and respondents who did not work with an advisor were more likely to indicate that divorce delayed or significantly delayed their timelines to reach certain goals.
Respondents were most likely to rate themselves as "somewhat confident" about being able to achieve their financial goals. Looking only at respondents who were very or extremely confident in achieving these goals, 64% worked with an advisor, and 36% did not.

Canada Life is committed to supporting Canadians through all life stages and events. We recently researched the impact of separation and divorce on women and their financial futures. There’s no question these events have a significant impact on both parties’ finances, but previous studies have shown that the resulting income losses tend to disproportionally affect women¹.

We surveyed a group of women who have experienced separation or divorce and asked them how this experience impacted their financial goals and to share what financial advice they would give to their former selves. Here’s what we learned.

Budgeting and planning with confidence during a separation or divorce

Going through a separation or divorce can be tough, and brings many life changes, especially when it comes to managing your finances. Creating a budget and a financial plan can be a big help in this new phase of life.

It's like having a roadmap for your money journey. When you know where you're headed, it's easier to make the right turns.

And you don’t have to do it alone. An advisor may be able to help. During and after a separation or divorce, an advisor can offer you trusted advice and support, like:

Clear communication and advice on the various financial elements of your divorce, which may help you to reach a fair and equitable division of your assets.
Highlighting the importance of your financial well-being and encouraging you to consider both your short-term and long-term goals
Helping you to prioritize your financial goals and sharing expertise with you on how to reach them.
Assistance with budgeting, saving, and financial planning.

The impact of an advisor

We surveyed a panel of women who have experienced separation or divorce to share what financial advice they would give to their former selves. The most common advice?

Set up a clear budget and saving plan
Maintain involvement in your household finances (pre-separation)
Consult with an advisor

Women who worked with an advisor as part of their divorce process were more likely to agree that the settlement was fair and equitable for both parties. Of respondents who worked with an advisor, 65% felt their settlement was fair and equitable. Of respondents who did not work with an advisor, only 35% felt this way.

Survey respondents that did work with an advisor as part of their separation or divorce, indicated they benefitted most from:

Assistance with budgeting/savings (particularly retirement savings)
Investment planning (product selection, fund selection)
Financial planning

Impact on financial goals - Importance

How did separation or divorce impact the importance of respondents' financial goals?

For the majority of respondents, separation or divorce tended to increase the importance of applicable financial goals. The distribution of ratings showed a pattern where goals most commonly rated as more important were budgeting and savings-focused, and goals less commonly rated as more important tended to be more strategic in nature (e.g., investing assets in the best way, managing taxes, etc.)
The goals most commonly rated as more important were being prepared for a financial emergency, and budgeting.
Women who worked with an advisor were more likely to place increased importance on longer-term strategic goals like managing assets post-retirement and investing their assets in the best way possible. This aligns with an advisor’s role in helping clients maintain a stronger focus on long-term financial health.
- Managing assets post-retirement – 78% of those who worked with an advisor rated this as having increased importance post-divorce, compared to 57% of respondents who didn’t work with an advisor.
- Investing assets in the best way possible – 63% of those who worked with an advisor post-divorce rated this as having increased importance versus 42% of respondents who didn’t work with an advisor.
Women who worked with an advisor as part of their divorce settlement process were more likely than those who didn't to rate almost all financial goals (both short term and longer term) as being more important.
According to the survey, two goals that weren’t delayed by separation were budgeting and preparing for a financial emergency:
- 71% indicated budgeting increased in importance post-separation
- 72% indicated preparing for a financial emergency increased in importance post-separation

Timelines for reaching these goals may have been accelerated due to the immediate need of the respondents to adjust and adapt to changes in household income, living situations, childcare costs etc.

Impact on financial goals - Timing

How did separation or divorce impact respondents’ timelines for achieving financial goals?

Separation or divorce delayed timelines for achieving measured financial goals for nearly half of all respondents and nearly every goal measured. Goals most commonly rated as delayed tended to be savings focused, and goals less commonly rated as delayed tended to be strategic in nature.
Budgeting, was a key exception, accelerated for a greater proportion of respondents vs. delayed.
Roughly 1/4 of all respondents indicated that paying off high interest debts, saving for retirement, and saving for a down payment were significantly delayed to the point that they now feel unattainable.
Although all survey respondents indicated that divorce had an impact on their financial goals, those who worked with an advisor were more likely to rate their goals as accelerated, rather than delayed, relative to those who did not work with an advisor. This supports the idea that working with an advisor can help to mitigate some financial setbacks that are often associated with divorce.
Respondents who did not work with an advisor were more likely to indicate that divorce delayed or significantly delayed their timelines to reach certain goals:
- Paying off low-interest debts (67% of people without an advisor reported a delay in reaching this goal, whereas only 35% of those with an advisor did)
- Paying off high-interest debts (67% of people without an advisor reported a delay in reaching this goal, whereas only 38% of those with an advisor did)
- Managing and planning for their estate (62% of people without an advisor reported a delay in reaching this goal, whereas only 29% of those with an advisor did)

Impact on financial confidence

How confident do respondents feel about being able to achieve their financial goals in general?

Survey respondents were most likely to rate themselves as “somewhat confident” about being able to achieve their financial goals. Looking only at respondents who were “very” or “extremely” confident in achieving these goals, 64% worked with an advisor, and 36% did not. This suggest working with an advisor during this time may help instill confidence in achieving your financial goals.
Respondents that were confident about achieving their financial goals most commonly attributed this to budgeting/saving, and or their income (via salary, pension, investments, or the sale of marital assets).
Respondents that were more uncertain about achieving their financial goals most commonly attributed this to an imbalance between their income and expenses (often citing the rising cost of living, and/or the impact of moving to a single household income), and an inability to save.

Resources, tools and advice from women who have experienced separation or divorce

We asked our panel of women who we surveyed to share tips and advice for others who may navigate this experience. Below we share the most common answers.

1. What financial resources, tools or advice were helpful during and after your separation or divorce?

Budgeting and saving plans
Consulting with financial advisors/professionals

2. What financial resources, tools, or advice do you wish you had received after your separation or divorce

Assistance with budgeting and saving plans
General financial planning
Help to identify sources of government assistance (i.e., grants and tax credits)

3. What financial advice would you give to your former self?

Make a budget
Consult with a financial planner
Maintain involvement in, or awareness of, household finances (pre-separation)

4. What financial resources, tools, or advice do you wish you had received after your separation or divorce

Assistance with budgeting and saving plans
General financial planning
Help to identify sources of government assistance (i.e., grants and tax credits)

Myths and misconceptions about securing financial advice

We asked survey respondents who did not work with an advisor as part of their separation or divorce to share their reasons why. Below we share the most common answers.

Lack of assets (liquid and/or illiquid)
Felt they could not afford to work with an advisor
Felt that it was not necessary (e.g., due to an amicable split)
Did not think to do so or they were not aware of the option to do so.

Some people don’t have an advisor simply because they think they can’t afford one or don’t have enough assets to justify working with one. That’s not always the case – there are options for people with all different financial realities. Talk to someone before you make that assumption.

What's next?

If you're going through a separation or divorce, know that creating a budget and a financial plan are your allies – and you don’t have to do it alone. An advisor can help you gain the control you deserve and show you that you can handle whatever comes your way. Managing your finances step by step can lead you to a brighter future.

Now that you know the steps to take to work through and financially recover from a divorce or separation, why not meet with an advisor to:

Create a post-divorce budget
Build a plan to achieve your post-divorce saving goals
Discuss estate planning changes

Source: The Women’s financial well-being through separation and divorce research was conducted by Canada Life through a survey deployed with its group plan member panel in May 2023. Research findings reflect survey responses from over 120 Canada Life female customers who have experienced separation and divorce.

Survey took place between May 10, 2023 to May 31, 2023 with a combination of closed-ended and open-ended questions to obtain both quantitative and qualitative feedback. Group plan member panelists with a marital status of “Separated” or “Divorced” were targeted with 129 completing the survey.

¹ LaRochelle-Coté, S., Myles, J. and Picot, G., « Income Replacement Rates Among Canadian Seniors: The Effect of Widowhood and Divorce »Opens a new website in a new window, Canadian Public Policy, vol. 38, no. 4 (2012), p. 471-495. Leopold, T., « Gender Differences in the Consequences of Divorce: A Study of Multiple OutcomesOpens a new website in a new window, Demography, vol. 55, no. 3 (2018), p. 769-797. Lin, S., I-F., and Brown, S. L., The Economic Consequences of Gray Divorce for Women and MenOpens a new website in a new window, The Journals of Gerontology: Series B , vol. 76, no. 10 (2021), p. 2073-2085.