Divorced middle-aged people are in worse financial shape than those who stay married, a new study from Australia has found. Those who got divorced in their 30s or 40s still cope with the financial aftermath into their 60s and 70s.
According to the Australian Institute of Family Studies, divorced people aged 55 to 74 had less disposable income and fewer assets than their married counterparts,
Researchers also found that men felt the strain worse than women, which is notable because men typically have more earning power.
The institute examined 2,000-3,000 older Australians between 2001 and 2016. Those who divorced 15 to 20 years ago had a weaker financial situation than those who were married. The study also found there was a 10 percent increase in divorce during that time period.
“Our analysis shows that divorced men and women have less household disposable income than their married counterparts at this later stage in life,” explained institute director Anne Hollands. “On average divorced single men were $10,000 worse off and divorced single women were $6,300 worse off over the 16 years.”
It’s unclear why men were slightly worse off when it came to household disposable income.
Hollands added that even when older people remarried they “were falling behind in their asset levels in recent years, compared to couples who had stayed married.”
Couples who tied the knot and stayed together increased their assets quicker than those who got divorced and those who later remarried.
“While household income levels can recover relatively quickly, it takes a longer period for assets like housing to appreciate in value,” Hollands pointed out. “Interestingly, men and women who had subsequently remarried were generally able to restore their income levels to match or even better those who had stayed married.”
Some people may be able to regain their financial situation more quickly after a divorce because of their level of education, according to AIFS Senior Researcher and Demographer, Lixia Qu.
Qu also noted that not all older divorcees are necessarily having financial problems. Instead, married individuals tend to receive higher income and more assets than their divorced counterparts.