Difficulty of Avoiding Poverty After Divorce or the Death of a Spouse

Poverty following a divorce or the death of a spouse is a reality for many individuals in today's world and this is particularly true when there are minor children and when the spouse left behind following death or divorce has limited education and no work-related skills. This work intends to examine the descent into poverty experienced by individuals following the death of a spouse or divorce from their spouse.

Poverty in the Aftermath of Divorce

The work of Gadalla (2008) entitled: "Gender Differences in Poverty Rates After Marital Dissolution: A Longitudinal Study" reports that data released by the Canadian Survey of Labor and Income Dynamics study were utilized in conducting an examination of rates of "entering low income for divorced and separated men and women from 1999 to 2004" and states that "one in 5 women entered low income in the breakup year as compared with 1 in 13 men. About one quarter of women remained in low income for at least 1 year compared with 9.8% of men. Most divorced and separated women who entered low income did so during the breakup year and remained in low income for 1 year. However, women less than 40 years old were at higher risk of persistent poverty." (Gadalla, 2008)

The work of David J. Cheal (1996) entitled: "New Poverty" relates that the risk of poverty among women "has often depended heavily on the nature of their relationships with men. When males are by convention breadwinners for their families, it is only through relationships with men that women can gain access to a regular income." Cheal relates that even in cultures and societies where women are generally employed, the earnings of women are generally so far below the wages of men, and often doing the same job, that advantages to sharing in the earnings of men are significant in nature. This is even truer when those women have children.

The work of Block (2000) entitled: "Gold Years Bleak for Divorcees" states that divorced women were shunned by society in Victorian times and were often forced to "spend their later years alone." However, in today's world divorced women "suffer a different fate… Among low-income retirees, they are the poorest of the poor. According to federal statistics, 22% of divorced female retirees live in Poverty vs. 18% of widows and 20% of women who never married. And the situation could get much worse. The number of retirement-age women will increase by 84% in the next 20 years to 9.6 million, according to U.S. Census figures. Meanwhile, the divorce rate remains stuck at about 48%."

This problem has interestingly been addressed and is reported in the work of Collie (1999) entitled: "D.I.V.O.R.C.E? I.N.S.U.R.E!" who states that a scheme has been devised to protect women "from falling into a poverty trap during or after divorce action has been set up by a new city firm. The plan, the first to target non-payment of maintenance, provides finance for the legal fees involved in fighting family and matrimonial cases." (Collie, 1999)

There are stated to be approximately 1 million women in the UK who are divorced added to another 150,000 each year that passes. Of these 2/3 have children. Howard Timmis of Edward Howard Insurance Services, stated to have originated DMI along with Lloyds underwriters, the Kiln group states as follows:

"The evidence shows that women and children are more at risk of poverty after divorce than men and, on average, suffer quite substantial declines in household income The situation worsens dramatically if the former husband suddenly can't, or simply won't, pay the maintenance. Women whose ex-husbands suffer sickness, redundancy or disability are forced onto state benefit unless or until they are able to support themselves as are those whose ex-partners die. Women whose financial lifeline is deliberately cut off are in the same predicament, as well as having to rely on legal aid to get their maintenance orders enforced." (Cheal,1996 )

Cheal states that there are findings of government agencies that support these stated facts and in fact that the Legal Aid Board recently published a report stating that in excess of "70% of the maintenance cases which it funds are brought by women." (1996) Even more alarming according to Cheal are the figures that the Child Support Agency released which reveals that CSA intervention is "mandatory wherever a lone parent claims benefit -- few that half result in the full level of child maintenance being paid. More than 30% of absent parents pay nothing at all toward the upkeep of their offspring." (Cheal, 1996)

Timmis cites "loose verbal agreement[s]" concerning financial support following a divorce to be one reason that women come out so horribly in divorce situations financially. The DMI insurance package is reported to "cover for up to two years' maintenance payments in the case of an ex-husband's accident, sickness or disability, and a lump sum payment of twice the annual amount of maintenance in case of his death. In the case of involuntary unemployment, the policy allows for up to 12 months maintenance payments." (Cheal, 1996)

Stated to be the most significant aspect of the DMI is the payment of "…up to pounds 12,000 in legal costs and expenses in any action seeking enforcement of a maintenance order. In the event of non-payment, the wife will be able to instruct the solicitor of her choice to take immediate action." (Cheal, 1996)

II. Poverty in the Aftermath of the Death of a Spouse

Cheal (1996) relates that U.S. Census data in 1900 shows that "77.2% of female-headed sole-parent households were headed by widows. In contrast, U.S. Consumer Expenditure Survey data for 1992 shows that only "9.4% of consumer units headed by a sole support mother were headed by a widow." (Cheal, 1996) While the death of a spouse in the 1900s was a likely position for women to assume in the present times women are more likely to be divorced than widowed however, in cases where a woman, or a man for that matter loses their spouse to death there are financial adjustments to be made and often these adjustments result in a decline into poverty.

Women and men who are widowed in the United States are reported to have "very low medium incomes." (Cheal, 1996) Cheal states specifically as follows:

"If net income is adjusted per reference equivalent, the percentage of each marital status category falling in the lowest income decile is as follows: married =5.7%; widowed = 9.2%; divorce=11.5%; separated = 22.9%; and never married = 19.5%. If net income is adjusted per capita, the widowed have the smallest percentage of any marital status category in the lowest income decile. However, when the lowest quintile of income per reference equivalent is used as the poverty line, then the widowed do appear to be somewhat poor, being poorer than both the marriage and divorced…" (Cheal, 1996)

While 77.7% of married couples own their own homes, for those who are widowed is stated at only 70%. Furthermore, the widowed are stated to spend a larger proportion of their total money receipts after all deductions on dwelling costs than do married individuals however, they spend the same approximate percentage as do those who are divorced, separated or never married.

Assessing the income of widows in the U.S. is "misleading, since it does not address the most distinctive cause of the genuine financial difficulties than many of them face. The most striking economic characteristic of widowed reference persons is the large median proportion of net income that they spend on health costs -- 9.5% versus 3.8% for the married and a low of only 0.8% for the never married." (Cheal, 1996)

It is reported in the work of Block (2000) that according to a social policy professor at Washington University in St. Louis, Martha Ozawa "In terms of living standards, it's not the widows who are the worst off… It's the women who enter retirement either separated or divorced." (Block, 2000) This is attributed to "short-term thinking -- trying to hang onto a dream home that took two incomes to support…" and as well women who are divorced "often get shut out of their ex's pension benefits." (Block, 2000) The result is that these women often are "forced to move in with their children, rely on loans from relatives, or seek other sources of outside income." (Block, 2000)

Block additionally relates that women often fail to insist that the receive survivor-benefits on their husband's pension plan and this is something that "can come back to haunt…women, even women who are divorced since "women often live longer than men." (Block, 2000) Dee Lee, a Harvard, Massachusetts financial planner reports that women in many cases should sell the marital residence, split the proceeds from the sale in exchange "for a portion on the ex-husband's retirement benefits." (Block, 2000)

Summary and Conclusion

Whether a woman loses her spouse to divorce or to death the chances that the…