BMO has officially published the results from its latest research called the Confidence Gap: From Uncertainty to Financial Clarity, The Journey to Rebuilding Wealth After Divorce, which discovered that women face significantly greater financial challenges during and post-divorce if their spouse managed the household’s finances during the marriage.
Going by the available details, this survey was essentially structured to study how financial advisors play a pivotal role in the context of helping women rebuild financial confidence and clarity. More on the same would reveal that 97% of respondents, who worked with such advisors, would go on to report improved confidence post-divorce.
“Financial confidence doesn’t happen by accident; it’s built through active participation. Women who take a hands-on role in managing their household finances are far better positioned to navigate life’s transitions,” said Amy Hale, Executive Sponsor, Women & Wealth, BMO Wealth Management. “Staying engaged in decisions around saving, investing, and planning isn’t just smart, it’s essential for long-term financial security.”
Talk about the whole value study on a slightly deeper level, we begin from divorce settlements emerging as lower than expected. You see, when their spouse was responsible for pre-divorce finances, respondents were significantly more likely to report that their divorce settlement was lower than they expected. This translates to how 40% said it was lower, as compared with just 9% who shared responsibilities, and 10% who were themselves responsible.
Next up, we must touch upon the point of shrinking financial confidence during divorce. Only 1 in 3 (36%) respondents would go on to report confident managing their finances during the divorce, compared to nearly two-thirds (64%) during their marriage. On the other hand, those who shared money management responsibilities equally during the marriage were deemed as significantly more likely (68%) to report consistent financial confidence during the divorce versus during the marriage.
Almost like an extension of it, the given report learned that financial confidence continues to remain low post-divorce. Half of respondents (50%), whose spouse was responsible for the finances during the marriage, felt financially confident post-divorce. For better understanding, this particular figure was much higher (90%) for respondents who shared equal money management roles with their spouse during the marriage.
Markedly enough, 39% of respondents said rebuilding financial confidence took more than a year post-divorce.
Moving on, 92% of respondents had separate retirement accounts from their spouse during their marriage, but having said so, 32% reported separate investment accounts.
Hold on, we still have a few bits left to unpack, considering we haven’t yet touched upon how nearly half (49%) of respondents relied on referrals from family and friends to find a divorce attorney. We also haven’t touched upon those 89% of all respondents said their attorney was helpful in positioning them to meet future financial goals.
Rounding up highlights would be a contingent of 63% respondents who were deemed to be largely reliant on referrals from friends and family to hire a financial advisor.
BMO further took this opportunity to introduce some suggestions for navigating the financial complexities of divorce.
These suggestions invovle assembling a team of experts, as attorneys and financial advisors are key professionals who can provide information, support and directi people during and post-divorce. The next recommendation in line relates to setting financial goals, including short-term and long-term financial goals.
Individuals must also keep track of their finances. Keeping track of how much money is spent and how much money is earned can basically take up the form of critical intelligence for long-term financial success. Alongside that, one can also implement a clear and strategic investment plan to ensure a financially sustainable retirement.
Founded in 1817, BMO’s rise up the ranks stems from providing a broad range of personal and commercial banking, wealth management, global markets, as well as investment banking products and services. The company’s excellence in what it does can also be understood once you consider it is trusted, at the moment, by more than 13 million customers.
“Divorce is not only an emotionally traumatic experience, but it can also be a financially traumatic one, too,” said Michele Havens, Head of BMO U.S. Wealth Management. “Women who were inactive in their household’s finances during their marriage often feel unprepared and blindsided by the financial stressors that a divorce brings. A financial advisor can be a stabilizing force, helping women regain control, rebuild confidence, and chart a new path forward. With the right guidance, financial independence becomes not just possible, but empowering.”
