People unprepared for financial impact of divorce

A recent study in Canada set out to gauge people’s thoughts on the impact of divorce, and found that many people underestimate the financial considerations and impact of divorce.

The majority (41%) of survey respondents felt that the impact of divorce would be greatest on family life. Only 19% felt that the biggest impact would be on their finances, and only 14% were worried on the impact on their standard of living. This is despite data from Statistics Canada which revealed that the most common issues raised during active divorce cases concern support and property.

The study, from BMO Financial Group, also asked respondents to identify what they believe to be the most important asset considered during a divorce proceeding (with the exception of children). The most important assets were found to be:

• Home (53%)
• Pensions (17%
• Investments (13%)
• Personal items (4%)

A BMO Financial Group spokesperson said:

“Because divorce is an emotionally charged event, financial implications - especially over the long term - can be underestimated. For individuals going through a divorce, it’s essential to take a step back from the emotional element and consider finances both short and long term carefully"