financial challenges of divorce & widowhood...key findings two-thirds (65%) of married americans...
TRANSCRIPT
Attitudes toward money, financial security and retirement
Financial Challenges of Divorce & Widowhood
Key Findings Two-thirds (65%) of married Americans don’t have a financial plan in place in the event of a divorce or becoming widowed. Despite the lacking of planning, almost the same percentage (66%) are confident in their abilities to manage their own financial situation in the event of a divorce or a spouse passing away. This is particularly true for men.
• In an average month, two-thirds of widows (67%) and nearly half (47%) of divorced Americans are not saving or investing any of their take-home pay . In comparison, 32% of married individuals don’t save or invest in a typical month.
• A potential reason why? Married Americans report an average personal income of $61,700. That’s $13,100 more than widowed Americans and $9,800 more than those who are divorced.
• Divorced people don’t feel financially secure. Just a quarter of divorced people say they feel financially secure, compared to 39% widowed and 43% of married Americans.
• Six in 10 (57%) remarried Americans are more mindful of money in their current marriage than previous one.
• Money was a factor in ending a previous marriage for one-third (32%) of divorced Americans.
• Four in 10 women started paying more attention to their finances when they became divorced or widowed, compared with 25% of men.
Impact to Retirement:
• Less than one-third (30%) of divorced Americans expect to be very financially secure in retirement compared to half (52%) of Married individuals and 42% of widowed people.
• Married individuals are more likely to expect they’ll fully retire compared to their divorced or widowed counterparts.
• About half of divorced Americans (49%) are worried about running out of money in retirement compared to 38% of married individuals and 35% of widows/widowers.
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4 9
15 20
MARRIED PERSPECTIVE DIVORCED/W IDOW ED PERSPECTIVE RETIREMENT IMPLICATIONS APPENDIX
Married Perspective
Two-thirds of married Americans don’t have a financial plan in place in the event of a divorce or becoming widowed
• Just one-third (35%) of married Americans have a financial plan to be prepared for such an event • Married women are slightly more likely than married men to be prepared (38%, 32%)
Do you have a financial plan in place in the event of a divorce,
or becoming widowed?
35%
65%
Yes No
Married
%
Male: 32% Female: 38%
Male: 68% Female: 62%
Q271. Base: All Married n=1,011; Married Males (n=471), Married Females (n=540)
Married men are more confident than married women in their abilities to manage their own financial situation in the event of a divorce
• Almost 7 in 10 married Americans are confident in their abilities to manage their own financial situation in the event of a divorce or becoming widowed.
• Over 7 in 10 (72%) men report this level of confidence compared to 6 in 10 (62%) married women
2 1 2 2 7 7 12 18 15 33
6 7 8 9 10
Not at all confident
Very confident
Married
8 to 10: 66% 1 to 3: 5%
1 2 3 4 5
How confident are you in your ability to manage your own financial situation in the event of a divorce, or becoming widowed?
Q270. Base: All Married n=1,011; Married Males (n=471), Married Females (n=540)
Male: 72% Female: 62%
Married
%
Six in 10 (57%) remarried Americans are more mindful of money in their current marriage than in their previous one
Are you more mindful of money in your current marriage than you were in your previous marriage?
57%
42%
1%
Yes No I prefer not to say
Currently married with at least one prior marriage
%
Q225. Base: All who are in a subsequent marriage (n=265)
8
Married Americans have a higher personal income than divorced or widowed Americans
• On average, married Americans report a personal income of $61,700. That’s $13,100 more than widowed Americans and $9,800 more than those who are divorced.
26 29
18
9 7
3 1
7
26
21
16
11 10
5 1
9
0
20
40
Less than $25,000 peryear
$25,000 to $49,999 peryear
$50,000 to $74,999 peryear
$75,000 to $99,999 peryear
$100,000 to $149,999per year
$150,000 or more I don’t know I prefer not to answerthis question
Unmarried Married
Which of the following categories includes your total personal income, that is, the income from any wages, dividends, investments, and benefits, before taxes?
%
Q60. Base: All Married n=1,011; All Unmarried n=1,008; Married Males (n=471), Married Females (n=540); Single (n=496), Widowed (n=204), Divorced (n=308) Arrows indicate a significant difference between Married and Unmarried at 95% confidence
Unmarried: $52,900
Married: $61,700
Average Personal Income
Single: $55,300; Widowed: $48,600; Divorced: $51,900
Divorced and Widowed Perspective
10
14
5
5
2
7
3
6
5
13
11
12
13
13
18
14
21
7
11
8
10
6 7 8 9 10
Not at all secure Very secure
Unmarried
Married
8 to 10: 43%
Not at all secure
8 to 10: 29%
Very secure
1 to 3: 11%
1 to 3: 26%
6 7 8 9 10 1 2 3 4 5
1 2 3 4 5
How financially secure do you feel, currently?
%
Divorced Americans feel less financially secure than those who are married or widowed
Q120. Base: All Married n=1,011; All Unmarried n=1,008; Single (n=496), Widowed (n=204), Divorced (n=308) Arrows indicate a significant difference between Married and Unmarried at 95% confidence
• One-quarter of divorced people say they feel financially secure, compared with 39% widowed and 43% of married Americans.
Single: 28%; Widowed: 39%; Divorced: 25%
Divorced Americans and widowers started paying more attention to their finances as a result of their divorce/becoming widowed
Which of the following happened to you, financially, when you became divorced or widowed?
37
35
31
25
11
11
8
7
6
5
4
4
19
I started paying more attention to our finances
I started to worry more about the future
I started spending less money
I started saving more money
I became more risk averse
I started saving less money
I started spending more money
I started working
I started to worry less about the future
I became less risk averse
I stopped working
I started paying less attention to our finances
None of the above
Divorced or Widowed
• Four in 10 (41%) women started paying more attention to their finances, compared to 1 in 4 (25%) men • One-third (35%) started to worry more about the future
%
Q216. Base: All Divorced or Widowed n=512
Divorced or Widowed
Male: 25%; Female: 41%
Male: 32%; Female: 22%
Male: 27%; Female: 16%
Male: 0%; Female: 10%
48
32
11
11
10
20
14
16
12
15
5
6
0% 5% or less More than 5%, up to 10%
More than 10%, up to 20% More than 20%, up to 50% 50% or more
In a typical month, what percentage of your take-home pay (that is, your income after taxes and deductions), do you save or invest, in total?
%
In an average month, two-thirds of widows (67%) and nearly half (47%) of divorced Americans are not saving or investing any of their take-home pay
Married
Unmarried
Any saving
Q135. Base: All, excluding don’t know, Married n=695; All Unmarried n=722. Arrows indicate a significant difference between Married and Unmarried at 95% confidence
Average % saved
15.6
11.7
Single: 42%; Widowed: 67%; Divorced: 47%
Single 14.5, Widowed: 6.6; Divorced: 10.8
Male: 9%; Female: 2% Male: 44%; Female: 52%
Male: 16.7; Female: 8.5
• On average, single unmarried Americans are saving a greater proportion of their take-home pay than widowed or divorced Americans (14.5%. 6.6%, 10.8%, respectively)
10
4
4
3
4
5
4
4
15
10
13
9
15
10
18
12
10
8
7
35
Do not trust at all
Trust completely
To what extent do you, or would you, trust the following to help manage your savings and investments?
6 7 8 9 10
8 to 10: 55%
8 to 10: 36%
1 2 3 4 5
6 7 8 9 10 1 2 3 4 5
%
Widowed and divorced Americans are more likely to trust themselves than to trust a financial advisor to manage their savings and investments
Unmarried
Unmarried
Myself
A human financial
advisor
Q115. Base: All Unmarried n=1,008; Single (n=496), Widowed (n=204), Divorced (n=308);
Widowed: 63%; Divorced: 52%
Widowed: 40%; Divorced: 34%
Money was a factor in ending a previous marriage for one-third (32%) of divorced Americans and 2 in 10 (19%) currently married Americans
Q220. Base: All with one marriage that has ended, Married (Currently) n=265, Divorced n=308
Were arguments or disagreements about money one of the reasons in the ending of your previous (most recent) marriage?
32%
63%
5%
Divorced
Yes No I prefer not to say
19%
78%
3%
Married (Currently)
Retirement Implications
16
14
5
4
2
5
2
7
3
10
9
11
11
15
16
14
23
11
15
10
14
6 7 8 9 10
Not at all secure Very secure
Divorced or Widowed
Married
8 to 10: 52%
Not at all secure
8 to 10: 35%
Very secure
1 to 3: 9%
1 to 3: 23%
6 7 8 9 10 1 2 3 4 5
1 2 3 4 5
How financially secure are you, or do you expect to be, in your retirement? %
One-third (35%) of divorced or widowed Americans expect to be very secure financially in retirement compared to half (52%) of married individuals
Q300. Base: All Married n=1,011; Divorced or Widowed n= 512 Arrows indicate a significant difference between Married and Unmarried at 95% confidence
• 42% of widowed Americans and only 3 in 10 (30%) divorced Americans expect to be very financially secure in retirement
Widowed: 42%; Divorced: 30%
17
Married Americans are more likely to expect they’ll fully retire compared to their divorced or widowed counterparts
Q315. Base: All who are not fully retired, Married n=718, Divorced or Widowed n= 293; Divorced n=216 Arrows indicate a significant difference between Married and Unmarried at 95% confidence
Which of the following best describes your expectations about if you will fully retire?
47%
29%
24% 38%
38%
24%
• 47% of married Americans expect to fully retire vs. 41% of divorced Americans
Married Divorced or Widowed
I expect to fully retire I want to fully retire but I will not be able to afford to I don’t want to fully retire because I love working/want to work
Divorced or widowed: 65.4 Married: 63.4
Average expected age of full retirement (if expecting to fully retire)
Divorced: 19% Too few Widowed to show
separately (n<100)
Male: 54% Female: 41%
Divorced: 41% Too few Widowed to show
separately (n<100)
%
18
About half of divorced Americans (49%) are worried about running out of money in retirement compared to 38% of married individuals
When it comes to retirement, which of these are you worried about, even if it is a nagging worry/is at the back of your mind?
46
38
Running out of money
Unmarried Married
• 35% of widows are worried about running out of money in retirement
Q370. Base: All Married n=1,011; All Unmarried n=1,008; Single (n=496), Widowed (n=204), Divorced (n=308) Arrows indicate a significant difference between Married and Unmarried at 95% confidence
Single: 49%; Widowed: 35%; Divorced: 49%
%
Widowed Americans expect the greatest proportion of their retirement income to come from social security
37
17
10 9
6
20
29
25
14 11
5
16
Social security Investments in a 401(k), 403(b)or other employer-sponsored
plan
A pension plan associated withwork (excluding 401(k)/403(b))
Investments in an IRA/Roth IRA Part-time work in retirement Annuity, Insurance(Longevity/QLAC, Disability etc)
and Other savings or income
Unmarried Married
What percentage of your retirement income comes, or do you expect to come, from each of the following sources?
Q360. Base: All Married n=1,011; All Unmarried n=1,008; Single (n=496), Widowed (n=204), Divorced (n=308)
Widowed: 46%; Divorced: 38%
Widowed: 10%; Divorced: 20%
%
Appendix
This survey was conducted by Head Solutions Group on behalf of TD Ameritrade Holding Corporation1
The statistical margin of error for the total sample of N=2,019 American adults within the target group is +/- 2.19%.2 This means that in 19 out of 20 cases, survey results will differ by no more than 2.19 percentage points in either direction from what would have been obtained by the opinions of all target group members in the U.S. Sample was drawn from major regions in proportion to the U.S. Census. Margin of error +/- 5.6 percent for 308 divorced Americans and +/- 6.9 percent for 204 widowed Americans. 1 Head Solutions Group (U.S.) Inc. and TD Ameritrade Holding Corporation are separate, unaffiliated companies and are not responsible for each other’s products and services 2 Assumes survey participants are the same as non participants Note: Percentages may not add up to 100 due to rounding.
New England
6%
Mid-Atlantic
18%
South
26%
Southwest
10%
West
17%
2,019 Americans aged
37 or older (half Married and half
Unmarried)
Online Survey
August 11 to 15,
2017
Average time to complete survey:
20 minutes
Head Solutions Group on behalf of TD
Ameritrade Holding Corporation1
41% Gen X 49% Boomers
10% Silent Gen.
Midwest
23%
WHEN WHAT WHO
CONDUCTED BY
Research Method
Unmarried Americans includes Americans who are Single, never married (n=496), Widowed (n=204) and Divorced (n=308) Throughout this report, arrows indicate a significant difference between Married and Unmarried Americans. Yellow callouts show significant differences within Married Americans and green callouts show significant differences within Unmarried Americans. .