Raleigh Real Estate

Marriage Creates Economic Inequality

Consider these statistics.  In the first year after a divorce, the women's standard of living often drops by 33%, while the husband's increases.

Another fact: the higher the income of the family, the wider the gap between partners.

The reason? Most couples still invest in the husband's career while the wife's job takes second place.  Even though society is changing, this pattern still holds for most couples.  And if the marriage lasted a long time, the wife has lost at least a decade of career growth.

The courts often ignore this crucial issue when dividing marital property.  Typically, divorce settlements divide only the tangible marital assets - the house, the car, the furniture.  For most divorcing couples, this marital estate is not very large, averaging less than $20,000.

On the other hand, many courts traditionally overlook one major asset of a marriage - the husband's career and career assets such as salary, retirement plan, stock options, seniority, and potential earning power.

Unfortunately, many courts don't recognize career assets as property.  So, even when a wife has worked to put a husband through law school or sacrificed her interests - invested in her spouse's assets - she gets nothing in return.

At the same time, the courts expect equal independence from both partners.  Sometimes the court will award rehabilitative maintenance to ease a spouse into the work force.  But the courts base these settlements on the assumption -often false- that both spouses can be equally self-sufficient.  Instead, women who have spent 20 or 30 years in traditional marriages find themselves out in the cold with no marketable skills and no real job prospects.

You can take action.  With detailed financial planning, you can solve these and other problems.  When you're trying to work out a fair settlement, remember that the court divides property only once, but career assets continue to produce income for years.

While you take that into account, your strategy should also include such factors as earnings, inflation, division of property, the amount and length of maintenance, and reduced standards of living.  If it's clear that one person will have surplus dollars from earnings, make sure this is considered when the court is making property settlements and maintenance arrangements.

This is an exerpt from Carol Ann Wilson's The Survival Manual for Women in Divorce.  I am a Certified Real Estate Divorce Specialist working with couples getting divorced and needing to deal with their real estate.  My job is to help couples manage this process as a third party.