Going separate ways remains costly
DIVORCE continues to cost older Australians well into their later years according to an Australian Institute of Family Studies research report.
The AIFS found divorced people aged between 55 and 74 years have less household disposable income and fewer assets than married couples of a similar age.
AIFS director Anne Hollonds said, "Divorced men and women were also worse off in terms of household assets in these later years and on this financial measure the gap appears to be widening. Even older divorced men and women who had remarried were falling behind in their asset levels in recent years, compared to couples who had stayed married."
Both Mark* and Sally* have been through two relationships and come out the other end carrying financial burdens.
Mark at age 69 has been through a divorce at age 40 and a defacto separation at age 67.
His divorce found him "homeless", but it motivated him to take his small business and grow it faster. "It probably did me a favour," he said. "I was hungry enough to brush myself off and get on with life again."
The second time around he was lot of older and with aspirations of slowing down his business and increasing his recreation activities. That relationship lasted 13 years.
Dusting himself off a second time has been a whole lot harder.
"Opportunities now are about nil in as much as what I have left I can't risk losing any more of it so it restricts my ability to invest in higher risk situations for a better income," Mark said.
"The second one cost me a lot of money, but I am still okay. The fact that I never been super rich in any way and I learnt the value of money ever since I was 10 years old when I was a paperboy; having less money than I had before and just having enough is okay by me."
He has been forced to sell his dream Queensland home acreage and move into a retirement village. "It's the best thing I have ever done; should have done it years ago," Mark said.
As to another relationship, Mark admits his experience has made him wary. "I wouldn't be setting myself up with someone with no money," he said. "If they had enough, that would be fine. If it all falls apart again I don't want to be in a situation where I lose any more than what I have now."
The AIFS study examined the financial consequences of divorce for about 3000 older Australians over 15 years. It found during this period there had been a 10 per cent increase in divorce.
Worth the heartache
Sydney resident Sally worked through her first marriage of seven years building a career and solid assets. At age 40 she decided to take the plunge again.
In her early 50s she stopped working. Not long after that she and her husband were caught up in an unsuccessful financial deal which was propped up by their superannuation. It left them reeling and with a lot of less of their retirement savings.
After 26 years of her second marriage behind her Sally, then 65, split from her husband. She was "sad, miserable and lonely". After several attempts to leave and acrimonious discussions about accessing their joint funds, home lockouts and credit cards closeure, she finds herself now living a nomadic lifestyle.
The legal costs of the acrimonious divorce and with only a small amount of super left for to use in retirement, she believes she will just have enough to buy a very small home and live on a pension.
While Sally says she is emotionally much better off, financially she is hurting. "But I am not asking anyone for any help," Sally emphatically stated. "I have worked most of my life; I earned a good living and I owned my own home before I met my husband. I have never been in a position where I have had to struggle so I really don't know what it is going to be like."
Sally has now found a new partner, but she is cautious about turning the relationship into a life partnership. "I am not sharing financially," Sally said. "We are only going to be partners. We haven't planned on living together permanently."
The AIFS research found married people who had never divorced were able to increase their assets at a faster rate than either single divorcees or those who had later remarried. However, not getting a divorce for older Australians isn't always an easy choice Sally said.
"I have quite a few friends who are in very unhappy marriages, who are in my age range," Sally said. "They are too terrified to leave because of the financial impact of splitting up."
* Names have been changed to protect identity.