Buy online
At a glance:
While both parties in a divorce will need to go through some financial reorganisation, women are statistically more likely to face a significant drop in household income. In honour of Women’s Month, this article provides a helpful financial guide to women in every stage of divorce:
- Why the pre-signing stage is your best opportunity to map what you jointly own, owe and earn before anyone else defines it for you.
- How your marital regime shapes what you are entitled to and why it is the first thing to confirm.
- The tax trap in splitting a pension and why transferring rather than withdrawing can save you a significant amount.
- How to find your real budget in the first few months by tracking spending rather than guessing.
- Why "downscale now, upgrade later" protects you when a payout lands.
- What can still be fixed after a bad settlement, what cannot, and why a rough start is never a permanent position.
When most people plan a wedding, they do it with spreadsheets and timelines and months to prepare. Divorce, by contrast, often arrives in the middle of everything else happening in your life, with much less thought and preparation. The money side of it tends to wait its turn while more urgent things get handled. Yet how you manage the financial transition from two-income to one-income household will shape your life long after the emotional dust has settled.
Because there is very little South African research on this, we have to look to international studies, which consistently show that women's household income drops by more than 40% after divorce. That is roughly double the fall men experience. Both parties rebuild with less, but women, statistically, have the bigger mountain to climb.
Since August is Women's Month, this feels like the right moment to highlight this issue. For many women, starting over after divorce is not just an emotional reckoning but a financial one, and it deserves a plan.
If you're thinking about it: the planning stage
If you are in the pre-divorce stage, nothing has been signed yet and everything is still up for negotiation. That makes it the most powerful position you will hold in the whole process, so use it while you have it.
Before anyone else defines your financial picture for you, understand it yourself. Gather twelve months of statements for every account, along with bond statements, vehicle finance, credit and store cards, and both retirement fund benefit statements. The aim is to make a clear list of what you own together and what you owe together, because you cannot divide fairly what you have not fully counted.
Then find out which marital regime you are married under, because that one fact shapes your entitlements more than almost anything else. In community of property, you share a single joint estate, so assets and debts are split down the middle. Out of community with accrual, you each keep what you brought in, but you share the growth built up during the marriage. Out of community without accrual, what is in your name is yours and what is in theirs is theirs. If you are not sure which applies to you, your antenuptial contract will say, and if there isn't one, you are almost certainly in community of property.
Together, these two steps tell you what is likely to be yours once everything is divided: roughly what you will walk away owning, and what you will still owe. That is what makes the final step possible.
Work out what you will actually have to live on afterwards by listing the income you expect to receive each month, then subtracting the essential costs that will now be yours alone, things like rent or bond, utilities, food, transport and debt repayments. What remains is the amount you will really have to live on each month and it is almost always lower than what your combined household income used to support. Knowing that figure before you negotiate lets you judge every settlement offer against the life you will really be living, rather than the one you are leaving behind.
If you're in it: the settlement stage
At settlement, decisions lock. What feels like paperwork today becomes the foundation of your finances for years, so this is the stage to slow down rather than rush through.
Pension interest is the value of what your ex-spouse has built up in their retirement fund up to the date of divorce. If you were married in community of property, or out of community with accrual, a portion of it may be awarded to you as part of the settlement. If that happens, it’s important to know that the decision you make about how you receive your share changes how much you actually keep. Take it as cash and you trigger tax, sometimes a large amount. Transfer it straight into your own approved retirement fund and it moves across tax-free. That is a decision worth getting right before you sign, because it cannot be undone afterwards.
The home, the way debt is divided, the maintenance arrangement: each of these is also settled in this stage of a divorce, and each is easier to get wrong than it looks. Before you agree to anything, run the numbers against the monthly figure you worked out in the planning stage - the amount you will actually have to live on. A settlement can look fair on paper and still leave you short every month once the real costs of keeping a house, servicing a debt or living on the maintenance offered are counted against your actual income. Settlement is the moment to catch that, while the terms can still change.
The first few months: finding your feet
Don’t try to build the perfect new budget the week the ink dries. You cannot know with 100% certainty what your new life costs yet, so any budget you set now is only a guess and it will likely frustrate you when the real numbers come in higher.
Instead, keep it loose for a while and track every expense as it happens. After three or four months the patterns start to show, and those patterns will tell you what your budget needs to cover. Let a few months of real spending do the work that willpower and guesswork cannot.
Pair this with a simple rule: downscale now, upgrade later. The temptation, especially if a payout has just landed, is to rebuild your whole life at once - the car, the furniture, the new home. Resist it. Keep your costs low while everything is still uncertain, and leave yourself deliberate room to upgrade later, once you know the ground beneath you is solid.
Once you've found your footing: consolidation
Now that you know what your single life costs, build the buffer that protects it. Aim for three to six months of living expenses in an emergency fund. This is far easier to size accurately now and it matters more than ever, because you alone carry costs that were once shared. There is no second income behind you if something breaks.
That same logic applies to the risks an emergency fund cannot absorb. When you were two, one of you could, in theory, carry the household if the other could not work. On your own that safety net is gone, so it is worth putting cover in its place.
- Income protection replaces part of your salary if illness or injury keeps you from earning.
- Disability cover pays out if you are permanently unable to work.
- Dread disease cover pays a lump sum on a serious diagnosis like cancer or a heart attack, when costs climb and income often drops.
- Make sure you have enough life cover in place, especially if children depend on you, so that they are provided for if something happens to you.
You don’t need all of it at once. Start with the cover that protects your income, since that is the risk you can least afford to carry alone, and add the rest as your budget allows.
Remember to update your will so it reflects your new circumstances rather than your old ones and revise the beneficiaries on your policies, your retirement funds and your other accounts so that nothing still routes to your former spouse by default years from now.
If the damage is already done: repair
Perhaps none of this reached you in time. Perhaps you signed a settlement you now regret, took the cash and paid the tax, kept a house you cannot really afford, or never updated a beneficiary form. If so, read this part carefully, because a bad start is not a permanent position.
Some things can still be fixed. Beneficiaries and wills can be updated today. Debt can be restructured. A house that is too heavy can be sold, even late. Other things cannot: a withdrawal already taxed stays taxed, a settlement already ratified stays ratified. The skill here is knowing the difference, so you spend your energy recovering what is recoverable and allow yourself to grieve and accept the rest rather than fight it forever.
Remember that divorce is a rebuild, not a setback, and a rebuild does not wait for the perfect starting point. You do not need the settlement to be signed, or the dust to have settled or a clean slate to work from. You only need one action you can take this week: pulling your statements into one list, checking which marital regime you are in, updating a single beneficiary form or opening the separate savings account your emergency fund will live in.
None of these steps fixes everything and none of them is meant to. They simply prove that the rebuild has started and that it started with you. Wherever you are on this timeline, you can take a proactive step forward today.