Search

Gray Divorce — Divorce After 50 How will it affect you financially?


A recent article by the L.A. Times brought some much-needed attention to the rise of gray divorces — a growing trend in the United States. Splitting up after age 50 — often called “gray divorce” — may be particularly hazardous to your emotional and financial health, far worse than doing so at younger ages. There are few things more devastating than divorce. Even the very wealthy can find it financially draining, emotionally harrowing and just plain messy. Among all adults 50 and older who divorced in the past year, 34% had been in their prior marriage for at least 30 years, and 12% had been married for 40 years or longer. Many later-life divorcees have grown unsatisfied with their marriages over the years and are seeking opportunities to pursue their own interests and independence for the remaining years of their lives, according to data compiled by the Pew Research Center. One opinion as to this trend is a result of empty nest syndrome, where their kids have left the house and they realize they’re not as in love as they once were or lack common interests. Other studies show that extramarital affairs could be to blame, with one spouse finding someone else. More than ever before 50+ers are stepping out and having affairs. Millennials are always surprised to see a sexy older man out and about connecting with women of all ages. Financial Considerations for Divorce Over 50 According to Kiplinger Alimony is almost always granted after long-term marriages. When you divorce in your younger years, usually “rehabilitative” alimony is granted, which will supply support while the spouse gets back on their feet. However, if it’s a long-term marriage, in most cases alimony is given for life. If it is a second marriage that is short term, alimony may fall in between the above circumstances. Retirement money is usually cut in half. It doesn’t matter if this is a no-fault or at-fault divorce. Pension plans may be used to offset alimony, but make sure that you both are being advised on the tax implications. The family house will become an asset that has to be valued and split. Make sure that if you opt to keep the house that you don’t become house-poor. The house needs to be maintained, taxes and utilities paid and those costs may greatly eat into any monetary settlements. Remarriages are more likely to end in divorce, so think about a pre-nup for your next marriage. In it you can deal with a lot of these monetary issues before emotions are running at a fevered pitch. There may be adult children on both sides to consider, other assets, and lots of other issues to think about. Seek professional advice from your lawyers, accountants and financial advisers. Your wills need to be adjusted to reflect your new circumstances, as well. The economic effects can be devasting to either or both parties. As more and more baby boomers end marriages, sometimes for the second or third time, they’re wrecking their finances on an unprecedented scale. In The Times article they stated: The economic effects of gray divorce on women can be brutal. Gray-divorced women aged 63 and older face a poverty rate of 26.9%, compared with 11.4% for gray-divorced men and only about 3% for couples who stayed married or re-married after a divorce. Jason Crowley, in A Guide to Divorce Financial Planning, stated, “Accepting your new reality having good and accurate information are important keys to making smart decisions about your financial future. You must also be aware that part of what drives your financial decisions will be influenced by the legal and emotional components of your divorce as well.”


8 views0 comments