Toll Free: 1 (866) 370-7677Death, a hard financial blow
Death of a loved one, does not only afflict the surviving person. It's a hard economic shock, especially for women, when employment incomes or pensions disappear.
Within the framework of a study, Statistic Canada looked into the data from 1993 to 2003, in regards to the financial consequences of a death in Canada.
The federal agency noticed that if everyone sees its incomes dropping with the loss of her husband or his wife, the financial standing of men improves somewhat after five years, whereas, the widows suffer on the budgetary level.
According to the method of calculation used, which is: the income adjusted according to the size of the family, the median income of 25 800 $ dropped by 15% over five years for women who lost their spouse.
On the other hand, for men, the median income passed from 27 800 $ to 29 400 $, an increase of 5,8%.
How to explain the phenomenon?
"What we see, are not real increases, says André Bernard, analyst at Statistic Canada. In most cases, the man drew the majority of retirement incomes of the family. Following death, the reduction in income is less than the reduction in the size of the family. It's a study on the standard of living."
Statistic Canada explains why, when one of the partners die, the sources of income of a household change. Women see their pension incomes drop by 28,6%, whereas, men lose only 1,1% of the money entries from this source.
"Women are thus more dependent with regards to the pension incomes because the man had the majority of the income", concludes the analyst.
Among men, it is especially the reduction in the gains of employment that can cause a drop in the incomes - and it's the second cause of budgetary problems for women, - because certain older women had an active spouse still on the labour market before death.
The study of Statistic Canada reveals that on the whole, 51% of the widowers underwent a loss of income five years after the death of their spouse, but that 72% of women were impoverished.
More precisely, 8,7% of women were in a situation of low income after a death, whereas 5,1% of men knew the same conditions.