More than 100,000 Canadians get divorced annually, according to Statistics Canada.
A new study from BMO Financial Group finds that while these individuals are going through what is sure to be a very emotional life event, few Canadians appreciate the financial considerations and impact of divorce.
The study is set out to gauge Canadians' thoughts on the impact of divorce. It was conducted by Leger Marketing.
Family life was considered the number one element impacted (41%).
But, finances and standard of living trailed by a wide margin (19% and 14% respectively). Among the key issues of access, custody, property and support cited in active divorce cases, the most common issues raised are support and property at 80% each.
Married adults who become divorced or widowed between the ages of 67 and 80 were projected to have the largest decrease in wealth and the largest increase in poverty, experiencing a decline in median income of as much as 37%, the BMO Retirement Institute said.
Caroline Dabu, Vice President of Retirement and Financial Planning at BMO Financial Group said because divorce is an emotionally charged event, financial implications, especially over the long term, can be underestimated.
Dabu added, 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, whether that means revisiting your financial plan or speaking with a financial professional.
She also suggested in order keeping various elements top of mind, including wills, real estate, investments and pensions, it is best to have a check list in place if going through a divorce.
Divorce law and the need for individuals to get legal advice immediately are also intertwined with the financial considerations of divorce.
Stephen Grant, Counsel at McCarthy Tetrault LLP, said divorce law has changed dramatically in the past few decades, which often results in misconceptions for couples who are going through one.
He added they often find that their clients are very surprised to see how the law applies to their individual situations.